Loans
Loans are the only form of financial aid that must be repaid. They are an
excellent low-interest source of paying college expenses; however, it is important
to be a responsible borrower--borrow only what you need to cover educational expenses
not the maximum. Federal loans have fixed interest rates, do
not require a credit evaluation, and in most cases, does not have to be repaid
until after you graduate, withdraw, or otherwise cease half-time enrollment.
Below is information on Federal Loan Programs available at LaGrange College.
Federal Perkins Loan
is a low interest, repayable loan that may be awarded to undergraduate and graduate
students with exceptional financial need. The interest rate is 5 percent and no
interest accrues on the loan while the borrower is enrolled half time and during
the grace period. Repayment begins nine months after graduating or withdrawal from
school. This loan program has cancellation provisions for critical fields of study.
Contact the Financial Aid Office for more information.
Federal Subsidized Direct Loan
is a repayable loan awarded on the basis of financial need. The Federal government
pays any accrued interest on the loan while the student is enrolled in school,
during the grace period or during authorized periods of deferment. Undergraduate
students may borrow annually a combination of subsidized and unsubsidized loans
not to exceed $3,500 as a freshman; $4,500 as a sophomore; $5,500 as a junior or
senior. Effective
7/1/2012
, graduate students are not eligible for subsidized loans.
Federal Unsubsidized Direct Loan
is not awarded on the basis of financial need. Any student regardless of income
may participate in this loan program. However, interest does accrue from the date
of disbursement until the loan is paid in full. The borrower has the options of
paying the accrued interest or having the interest capitalized.Undergraduate students
may borrow annually a combination of subsidized and unsubsidized loans not to exceed
$3,500 as a freshman; $4,500 as a sophomore; $5,500 as a junior or senior. Graduate
students may borrow $20,500 annually.
Federal Direct Parent Loan for Undergraduate Students (PLUS)
is available to the parents of a dependent student to defray remaining educational
expenses after all other financial aid resources are exhausted. Eligible applicants
may borrow up to the cost of attendance less other financial aid. The interest
rate will not exceed 9%. Unlike the Federal Stafford Loan program, PLUS borrowers
must be credit worthy to qualify for this loan and repayment begins within 60 days
of the loan disbursement. Parents can apply online at
www.studentloans.gov
.
Federal Direct Graduate PLUS Loan
is available for graduate students who need to borrow funds beyond the
federal direct subsidized and unsubsidized loan limits. The Graduate PLUS
Loan will have a fixed 7.9 percent interest rate, a 4.0 percent origination fee
deducted at disbursement, and all other
federal direct loan criteria
. A 1.5 percent rebate is refunded to the student borrower who makes the first
12 monthly payments on time that reduces the origination fee to 2.5 percent. No
annual or aggregate borrowing limits are imposed, other than cost of attendance
less other financial aid received.
Private/Alternative Educational Loans
Private Alternative Loans
are non-federal educational loans through private lenders. L aGrange College
does not endorse or promote any lenders that offer private alternative loans. We
advise that
this
loan option be used as a last resort after all federal loan options have been
exhausted.
The interest rate, repayment fees and terms are more favorable under the Federal Direct Loans.
Research different alternative lenders and their loan products, their benefits
as well as exploring other means of financial aid before applying for an alternative
loan is to the advantage of the student. We recommend that you use alternative
student loans conservatively as the interest rate will be variable or floating
and will not be capped. Depending on the lender that you choose, the interest rate
will change every month or every quarter.
Please review this
Alternative Loan List
for a historic list of loans and/or lenders from whom our students have borrowed
over the past five years and it includes only those that continue to offer private
alternative loans. This list is not meant as an endorsement and is not a preferred
lender list. You will be asked to submit a
Self Certification Form
when requesting a private loan. Cost of attendance information will be requested
and can be found
here
.