Loans are a form of financial aid that must be paid back with interest. Student loans can come from the federal government, private banks or other organizations. Before you decide to take out a loan, make sure you understand who is offering the loan and what the terms and conditions are
Along with completing the FAFSA application, students must also be admitted as degree-seeking undergraduate students and be meeting all aspects of Satisfactory Academic Progress (SAP).
The Chattahoochee Valley Community College participates in the Federal Direct Loan Program. Under the Direct Loan Program, all funding comes directly from the U.S. Department of Education rather than a bank or financial institution. The U.S. Department of Education will be the one source for lending and repayment.
Direct Loans are low-interest educational loans administered through the U.S. Department of Education, which consist of the following:
The Federal Direct Loan is a non-credit based student loan for undergraduate and graduate students. There are two basic types of Direct loans: subsidized and unsubsidized. Both have a 6 month grace period (a period of time when a student is no longer enrolled for at least half-time and not required to make payments) and fixed interest rates, which are determined each year on July 1st. For interest rates, please refer to the Direct Requirements page for more information.
Government pays the interest on behalf of the student while the student is in the deferment period and grace period. Once in repayment, the student is responsible for paying the interest on the loan as well as the principal amount borrowed.
The student’s cost of attendance must exceed his/her Expected Family Contribution (EFC) to be eligible for “need-based” aid (such as grants, scholarships and subsidized loans).
The EFC is based on information collected from the Free Application for Federal Student Aid (FAFSA). The total amount of the subsidized loan combined with other “need-based” aid cannot exceed the student’s “financial need.”
Government does not pay the interest on behalf of the student. Instead, the borrower is responsible for all the interest that accrues and capitalizes from the time the loan disburses.
Independent students may be eligible for greater unsubsidized amounts than dependent students.
Though it is non-need based aid, the amount of unsubsidized loan combined with other aid cannot exceed the total estimated cost of attendance.
The Federal Parent PLUS Loan is a credit based federal loan for parents (biological, adoptive, or in some cases stepparent) of eligible dependent students. Interest that accrues on the loan is not subsidized by the federal government.
You must be a parent of a dependent who meets the following requirements:
Private Loans can vary in terms, conditions and eligibility requirements. For these reasons, Private Loans should be considered as a last resort for educational purposes after all other federal aid options have been exhausted.
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