Loans
- Student Loans
- Federal Stafford Loans
- Federal PLUS Loans
- Federal Perkins Loans
- Loan Counseling
- Private Loans
- Loan Forgiveness
- Finding Your Loans
- Loan Default Rates
Student Loans
| Loan | Eligibility | Amount for Academic Year | Interest Rate | Notes |
|---|---|---|---|---|
| Federal Perkins Loan | FAFSA required. Preference given to borrowers with exceptional financial need. | $1,500 |
5.00% fixed | Based on exceptional need and availability of funds. No origination fee. Payments deferred while you're enrolled at least half-time. Max. undergrad aggregate: $20,000. |
| Federal Subsidized Stafford Loan | FAFSA required, but no deadline. Must show need and be enrolled at least half-time. | Varies according to need, year in school, previous borrowing. | 6.0% Undergraduate
|
Payments deferred and no interest charged while you're enrolled at least half-time. |
| Federal UnSubsidized Stafford Loan | FAFSA required but no deadline. Must be enrolled at least half-time. | Varies according to cost of attendance, year in school and previous borrowing. | 6.8% | Payments deferred and Interest begins accruing at the time of loan disbursement. |
| Federal Parent PLUS | FAFSA required but no deadline. For parents of dependent undergrad's enrolled at least half-time. You must complete a PLUS application. |
Enough to meet cost of attendance | 8.5% | You must complete a PLUS application. Repayment begins within 60 days after the final loan disbursement. |
| Private Alternative Loan | Credit Worthiness (Other eligibility requirements vary by loan and lender.) | Max: Enough to meet cost of attendance | Varies | Cosigners may be required. Payments deferred and Interest begins accruing at the time of loan disbursement. |
You must not be in default on prior educational loans.
Federal Stafford Loans
Details
- Interest rates:
- For loans disbursed before July 1, 2006: variable interest rate subject to change each July 1 (but not to exceed 8.25%); currently at 6.54% for loans in in-school, grace, and deferment periods.
- For loans disbursed on or after July 1, 2006: fixed interest rate of 6.0% for undergraduate Subsidized Stafford Loans, 6.8% for all other Stafford Loans
- Two types of Federal Stafford Loan:
- Subsidized: a need-based loan, on which the government pays the interest while the student is enrolled at least half time.
- Unsubsidized: a non-need-based loan, on which interest begins accruing immediately upon the loan’s first disbursement.
- Repayment does not begin until six months after the student graduates or drops below half-time enrollment.
- Master promissory note (MPN):
- After a student signs the Federal Stafford MPN for IUS, the MPN remains valid for ten years.
- A student must be enrolled at least half time to be eligible for the Federal Stafford Loan.
- Federal Stafford Loan eligibility is limited by federal aggregates:
STAFFORD LOAN LIMITS
| Class | Subsidized/Unsubsidized Amount Combination |
Additional Unsubsidized Independent Student |
| Freshman | $3,500 | $ 4,000 |
| Sophomore | $4,500 | $ 4,000 |
| Junior | $5,500 | $ 5,000 |
| Senior | $5,500 | $ 5,000 |
| Teacher Certification | $5,500 | $ 7,000 |
| Graduate | $8,500 | $12,000 |
Lender Selection Information
Students borrowing funds through the Federal Stafford Loan Program for the first time at Indiana University are required to select a lender. Students who borrowed at IU last year will generally have their loans processed by the same lender used then unless they request a change. Students may choose any participating lender for loan processing.
Recommended Lenders
IU recommends the lenders listed below. All offer very favorable loan terms and conditions, and none charge loan fees.
- Dollar Bank
- Fifth Third Bank
- Sallie Mae Education Trust
- Academic Management Services
- Student Loan Funding
Sallie Mae Education Trust® |
Academic Management Services® (AMS®) |
Student Loan FundingSM |
Dollar Bank
|
Fifth Third Bank |
0.25 percentage point interest rate reduction for making payments using automatic debit 2
|
0.25 percentage point interest rate reduction for making payments using automatic debit 2
|
0.25 percentage point interest rate reduction for making payments using automatic debit 2
|
0.55 percentage point interest rate reduction for making payments using automatic debit 2
|
0.30 percentage point interest rate reduction for making payments using automatic debit 2
|
5% loan credit based on the scheduled monthly payment amount of each of the first 18 payments made as initially scheduled3 |
0.25 percentage point interest rate reduction after making the first 12 payments as initially scheduled4 |
1% Loan Credit - Borrowers can receive a 1% loan credit, based on the original loan amount, after making the first 12 payments as initially scheduled5 |
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0.50% Loan Credit – Borrowers can receive a 0.50% loan credit, based on the original loan amount, after making the first 12 payments as initially scheduled5 |
2: Direct RepaySM – Borrowers who authorize the automatic debit of funds from their checking or savings accounts to cover their monthly education loan payments will receive an interest rate reduction in the amount indicated above on their eligible loans. This benefit remains available during active repayment for as long as the borrower’s monthly payment is successfully deducted from the borrower’s account. |
3: Loan Credits -- In addition to a zero origination fee, Sallie Mae Education Trust offers loan credits: Students will receive loan credits of 5% based on the scheduled monthly payment amount for each of the first 18 payments made as initially scheduled. As such, if a student only makes payments 2, 3, 7, 10 and 11 on time, the student can earn 5% of each of those payments. In summary, the student’s ability to earn the benefit in each of the first 18 months is not impacted by any late payments in other months during that period. To qualify for these loan credits, borrowers simply also do the following: |
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These credits will be applied to the borrower’s Sallie Mae loan account after he/she makes the 18th scheduled payment to Sallie Mae and the loan is in a non-delinquent or non-default status |
4: Interest Rate Reduction - To qualify for interest rate reductions, borrowers must also, prior to entering repayment, sign up on Manage Your LoansSM to receive account correspondence and information by email. Borrowers must continue to pay as initially scheduled to retain the interest rate reduction. |
5: Loan Credit – Borrowers can receive a loan credit in the amount indicated above, based on the original loan amount, after making payments as initially scheduled (as indicated above). To qualify, a borrower must also, prior to the first payment due date, sign up on Manage Your Loans to receive account correspondence and information by email. |
How to Indicate Your Lender Choice
If you are a new borrower, you will need to accept loans offered to you through OneStart. When you accept a loan, the lenders above will be presented and you can choose among them. If you have borrowed before and want to change lenders, or if you want to use a different lender please contact the financial aid office at financialaid@ius.edu.
The Lender Selection Process
Indiana University initiated a Request for Proposals (RFP) for processing federal student loans. Information was requested from most of the major participants in the federal student loan industry and IU received responses from lenders across the country. A committee reviewed these to determine which lenders currently offer the best borrower benefits.
Specific issues considered by the committee included; origination and default fees charged, interest rates, benefits offered during loan repayment, frequency of interest capitalization, borrower information sharing practices, and level of loan processing automation including electronic data exchange to expedite loan processing and fund disbursement.
This rigorous review process resulted in Indiana University’s decision to select Sallie Mae to serve as the preferred federal loan servicer. The individual lenders selected represent the Sallie Mae participants with the most attractive collection of terms and benefits, based on the factors weighed in the review process.
Federal PLUS Loans
Eligibility
Parent PLUS Loans
- You need to be the natural or adoptive parent of the student for whom the Federal PLUS Loan is being borrowed. A stepparent is also eligible to borrow.
- You need to be a U.S. citizen, U.S. national, or permanent resident of the United States.
- Your child needs to be an eligible dependent undergraduate student who is enrolled at least half time in a program leading to a degree or certificate.
- You and the student must not be in default on a federal student loan and not owe a refund on a federal educaiton grant.
- You need to meet specified credit requirements.
- If parents are denied a PLUS loan due to adverse credit, the student will become eligible for additional unsubsidized stafford loans. Amounts vary depending on the students academic level. Contact the financial aid office if you have been denied a PLUS loan.
Graduate Plus Loan
- You need to be a U.S. citizen, U.S. national, or permanent resident of the United States.
- You must be enrolled at leasat half-time in a program leading to a degree or certificate.
- You must not be in default on a federal student loan and not owe a refund on a federal educaiton grant.
- You need to meet specified credit requirements.
Borrowing Limits
You may not borrow more than your cost of attendance less other aid received.
Interest Rates
Fixed rate at 8.5 percent for loans first disbursed on or after July 1, 2006.
Repayment
After you receive the full disbursement of the Federal PLUS Loan for the school year, the repayment period begins. You will make your first payment within 60 days after the entire PLUS Loan is disbursed for a school year. Keep in mind, this usually means that repayment begins while your child is still in school. You make monthly payments directly to the lender.
Lender Selection
Students and parents may choose to borrow a PLUS loan from any lender participating in the PLUS loan program. IU recommends the lenders listed below which offer very favorable loan terms and conditions. If you chose to borrow a PLUS loan from one of the lenders listed below you may Complete a PLUS Loan Application Through Sallie Mae. If you choose to use a different lender contact the lender of your choice for their application process and then notify the financial aid office at financialaid@ius.edu.
Parent PLUS Borrower Benefits
Sallie Mae Education Trust |
AMS |
Student Loan Funding |
Dollar Bank |
Fifth Third Bank |
0.50 percentage point interest rate reduction for making payments using automatic debit 2 |
0.75 percentage point interest rate reduction for making payments using automatic debit 2
|
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1% loan credit after making the first 24 monthly payments as initially scheduled 5 |
||||
Graduate PLUS Borrower Benefits
Sallie Mae Education Trust |
AMS |
Student Loan Funding |
Dollar Bank |
Fifth Third Bank |
0% Default Fee1 |
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0.50 percentage point interest rate reduction for making payments using automatic debit 2 |
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1% loan credit after making the first 24 monthly payments as initially scheduled 5 |
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0: 0% Loan Origination Fee for Stafford Loan Borrowers – The lenders indicated above will offer Stafford Loans with zero percent loan origination fees. These lenders will pay the origination fee on the borrower's behalf on Stafford Loans guaranteed from 2/1/2008 – 6/30/2009. |
1: 0% Default Fee – The 1% federal default fee will be paid on the borrower’s behalf on Stafford and Grad PLUS Loans made to IU borrowers that are guaranteed by USA Funds 2/1/08 through 6/30/09. |
2: Direct RepaySM – Borrowers who authorize the automatic debit of funds from their checking or savings accounts to cover their monthly education loan payments will receive an interest rate reduction in the amount indicated above on their eligible loans. This benefit remains available during active repayment for as long as the borrower’s monthly payment is successfully deducted from the borrower’s account. |
3: Loan Credits -- In addition to a zero origination fee, Sallie Mae Education Trust offers loan credits: Students will receive loan credits of 5% based on the scheduled monthly payment amount for each of the first 18 payments made as initially scheduled. As such, if a student only makes payments 2, 3, 7, 10 and 11 on time, the student can earn 5% of each of those payments. In summary, the student’s ability to earn the benefit in each of the first 18 months is not impacted by any late payments in other months during that period. To qualify for these loan credits, borrowers simply also do the following: |
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|
|
These credits will be applied to the borrower’s Sallie Mae loan account after he/she makes the 18th scheduled payment to Sallie Mae and the loan is in a non-delinquent or non-default status |
4: Interest Rate Reduction - To qualify for interest rate reductions, borrowers must also, prior to entering repayment, sign up on Manage Your LoansSM to receive account correspondence and information by email. Borrowers must continue to pay as initially scheduled to retain the interest rate reduction. |
5: Loan Credit – Borrowers can receive a loan credit in the amount indicated above, based on the original loan amount, after making payments as initially scheduled (as indicated above). To qualify, a borrower must also, prior to the first payment due date, sign up on Manage Your Loans to receive account correspondence and information by email. |
The Lender Selection Process
Indiana University initiated a Request for Proposals (RFP) for processing federal student loans. Information was requested from most of the major participants in the federal student loan industry and IU received responses from lenders across the country. A committee reviewed these to determine which lenders currently offer the best borrower benefits.
Specific issues considered by the committee included; origination and default fees charged, interest rates, benefits offered during loan repayment, frequency of interest capitalization, borrower information sharing practices, and level of loan processing automation including electronic data exchange to expedite loan processing and fund disbursement.
This rigorous review process resulted in Indiana University’s decision to select Sallie Mae to serve as the preferred federal loan servicer. The individual lenders selected represent the Sallie Mae participants with the most attractive collection of terms and benefits, based on the factors weighed in the review process.
Federal Perkins Loans
This loan program is based on availability. Financial need is determined by completing the FAFSA and is required. The interest rate on these loans is 5% and repayment begins 9 months after the student leaves the university. A Promissory Note is required for the Perkins loan before disbursement. Once you have received your Financial Aid Notification letter you will be asked to complete the Promissory Note through the
At this session you will:
-
Complete your Entrance Interview Questionnaire.
- Review your student loan Rights & Responsibilities.
- Review and sign your student loan promissory note.
- Print your signed promissory note.
- Read counseling summary and links to other helpful websites.
Please note: This process will need to be completed annually for Perkins loans and your promissory note will remain with the Student Loan Administration.
Loan Counseling
Entrance Counseling
Entrance Loan counseling is required for all students taking out their first Federal Stafford loan. Federal Stafford counseling is done on the web. Loan funds cannot be disbursed until counseling is completed.
If you are unable to complete the counseling on the web or have any questions, please contact the Office of Financial Aid.
Exit Counseling
Exit Counseling is required for both the Federal Perkins and Federal Stafford loan programs. Counseling is required when you separate from the institution either by dropping below 1/2 time or by graduating. To complete loan counseling follow the links below. If you have any problems with the web or have questions, please contact the Office of Financial Aid.
For Stafford Loan assistance you may also contact your lender. If you do not know who your lender is, please review how to find your loans. For Federal Perkins counseling, you may contact the Student Loan Administration in Bloomington at 812-855-4511 or toll-free at 1(866)485-6267 (1-866-IULoans).
Failure to complete Exit counseling will result in a "hold" being placed on your records. You may also access information on your loans by accessing the National Student Loan Data System (NSLDS). Through this website you can see all federal loans in your name, including Parent Plus loans. You can track individual loans, and find contact information for your lender, guaranty agency, servicer and school.
Begin Exit Counseling for Stafford Loans
| Begin Exit Counseling for Perkins Loans|
Private Loans
Some students may need to consider applying for a private alternative student loan. You need to be enrolled at least half-time before we will review your eligibility for a private alternative loan. Generally the certification process will take 10-14 business days but could be longer during peak times (August through October).
When lookiing for a private loan, be sure to do your homework. Many lenders offer private educational loans with varying terms and interest rates. Be sure to shop around and find the private educational loan that works best for you. Be mindful that lenders will offer you more money than you may need.
Important Note:
When completing the application, please use the following dates to indicate which academic period you would like to borrow the loan. Using dates other than those listed below may result in processing delays.
2007-2008 Academic Year 08/27/2007 - 04/29/2008
Spring 2008 Semester 01/07/2008 - 04/29/2008
Summer 2008 Semester 05/06/2008 - 08/04/2008
2008-2009 Academic Year 08/25/2008 - 05/05/2009
Fall Semester 2008 8/25/2008 - 12/13/2008
Spring 2009 Semester 01/12/2009 - 05/05/2009
Loan Forgiveness
Under certain circumstances, the federal government will cancel all or part of an educational loan. This practice is called Loan Forgiveness. To qualify, you must:
- Perform volunteer work;
- Perform military service;
- Teach or practice medicine in certain types of communities; or,
- Meet other criteria specified by the forgiveness program.
To find out whether you qualify for loan forgiveness, talk to the human resources staff at your employer. Here is additional information concerning Loan Forgiveness.
Finding Your Loans
Have you lost your loan promissory notes? Did you attend another college or two before attending IU Southeast and you cannot remember the type of loan or the lender? Help is available!
The National Student Loan Data System (NSLDS)
NSLDS maintains a central database of student aid for the US Department of Education. NSLDS allows you to access your Stafford Loan(s) and Perkins Loan(s) outstanding balances, loan statuses, and disbursements. The Direct Loan Program, PELL Grant Program and other US Department of Education programs are also on file at the NSLDS website.
STEP 1: Access NSLDS by going to www.nslds.ed.gov. On the NSLDS screen, click on Financial Aid Review and the Gathering Your Information screen will appear.
STEP 2: Read the privacy statement on this screen. If you agree, click Accept to continue the process of finding your loans. The Confirming Your Identity screen will appear after you click Accept.
STEP 3: Enter your PIN, Social Security number (SSN), the first two letters of your last name, and your date of birth to confirm your identity. You can electronically sign documents, including your promissory note(s), and retrieve personal information. Keep your PIN safe and secure.
STEP 4: View the FINANCIAL AID REVIEW screen listing your Title IV loans, including the loan amount, loan date, disbursed amount, canceled amount, outstanding principal and outstanding interest reported to NSLDS by your lenders. If you have questions, you can call the US Department of Education at 800-4FEDAID.
The Federal Student Aid Information Center
To find out who your Stafford and/or Perkins lender(s) are, contact the Federal Student Aid Information Center by calling 1-(800)-433-3243.
Credit Bureau Reports
You can also request a credit report from a credit bureau. There is a charge for this service. Your Stafford and Perkins loans will be listed in your credit history. If you have private, alternative loans, a credit report is the best resource of loan and/or lender information. To obtain a credit report from one of these credit bureaus, call or log onto:
Equifax
(800) 658-1111
www.equifax.com
Experian
(888) 397-3742
www.experian.com
TransUnion
(800) 916-8800
www.transunion.com
Loan Default Rates
Average Stafford Default Rates
Cohort Year |
IU Southeast |
National |
2005 |
2.7% |
4.6% |
2004 |
3.7% |
5.1% |
2003 |
2.9% |
4.5% |
Average Perkins Default Rates
Cohort Year |
IU Southeast |
National |
2005 |
3.31% |
8.1% |
2004 |
2.28% |
8.12% |
2003 |
.48% |
8.29% |
