Information about the Student and Parent Loan Programs at Cottey
President Obama has signed legislation which makes the government the primary lender for student loans and ends the bank-based Federal Family Education Loan (FFEL) Program. Beginning with the 2010-11 academic year, all federal student loans will be through the William D. Ford Federal Direct Loan (Direct Loan) Program.
There are two types of Direct Loans for students: subsidized and unsubsidized. The student must file a FAFSA in order for their eligibility to be determined. Subsidized loans are need-based and the Department of Education pays the interest while the student is enrolled at least half-time or in deferment. Unsubsidized loans are not need-based and students are responsible for paying the interest that accrues on the loan from the time the loan is disbursed until it's paid in full. The 2013-14 interest rate for both subsidized and unsubsidized loans is 3.86%. There is an origination fee of 1.051% for both subsidized and unsubsidized loans.
+ Previous Borrowers:
+ First-time Borrowers:
- Loan entrance counseling
- Sign a Master Promissory Note -
For more information about the terms and conditions of the Federal Direct Loan, see http://www.direct.ed.gov/pubs/dlmpn.pdf.
Annual student loan limits
First Year Total (maximum $3,500 subsidized)
- Dependent Undergrad Students - $5,500 *
- Independent Undergrad Students - $9,500 **
Second Year Total (maximum $4,500 subsidized)
- Dependent Undergrad Students - $6,500 *
- Independent Undergrad Students - $10,500 **
Third Year and Beyond (each year) (maximum $5,500 subsidized)
- Dependent Undergrad Students - $7,500 *
- Independent Undergrad Students - $12,500 **
* except students whose parents cannot borrow PLUS loans
** and dependent students whose parents cannot borrow PLUS loans
There is a limit to the total amount of Federal Direct Subsidized student loans that you may receive. Please visit http://studentaid.ed.gov/types/loans/subsidized-unsubsidized#is-there-a-time-limit for more information.
Direct PLUS Loans are made to parents of dependent undergraduate students to help pay for the cost of education. On the parent loan, parents may borrow up to the cost of attendance minus the amount of any other financial aid the student receives. To be eligible, a parent must be:
- The biological or adoptive parent of the dependent undergraduate student or the spouse of the student's parent and your income and assets were reported on the FAFSA.
- You and your child must be a U.S. citizen or national, a permanent resident of the U.S. or an otherwise eligible non-citizen.
- You and your child must not be in default on a federal education loan or owe an overpayment on a federal education grant and must not have been convicted of, or pled no contest or guilty to, a crime involving fraud in obtaining funds under the Act.
- You must not have an adverse credit history (unless you can document extenuating circumstances or obtain an endorser who does not have an adverse credit history).
The 2013-14 interest rate on a Direct PLUS loan is a fixed rate of 6.41%. There is an origination fee of 4.204% of the principal amount of each loan you receive. If the parent of a dependent student is interested in applying for a Federal Direct PLUS Loan, the parent should go to https://studentloans.gov, sign in with their own FAFSA PIN, click on request a Direct PLUS Loan, select Parent PLUS, and complete the required information.
+ Alternative Loans:
Below is an historic list of lenders from whom our students have borrowed during the last few years. This list is not meant as an endorsement and is not a preferred lender list. Borrowers are free to choose any lender that offers alternative loans. Some of these lenders may no longer offer alternative loans.
Historic List of Alternative Loan Programs
- Campus Door
- Discover Student Loans
- Fifth Third Bank
- M & I Bank
- Sallie Mae Smart Option Student Loan
- Wells Fargo Collegiate Loan
+ Student Loan Code of Conduct:
- The College shall not engage in any revenue sharing arrangement with any student lending institution.
- No employee of the College shall accept on his or her behalf, anything of more than nominal value from a student lending institution.
- No employee or representative of a student lending institution shall be authorized by the College to be identified to the public as an employee or representative of the College.
- No employee or representative of a student lending institution shall provide staffing services to the College financial aid office.
- No employee of the College who is employed in, supervises or otherwise has responsibility or authority over the College's financial aid office shall receive any remuneration for serving as a member or participant of a student loan advisory board of a lending institution.
If the College decides to offer a list of preferred or recommended lenders for student loans, the selection of lenders shall be based on the best interests of the College's students and their parents, without regard to the financial interests of the College. Students and their parents have the right to select the lender of their choice and will suffer no penalty imposed by the College for choosing a lender that is not a preferred or recommended lender. The College shall review and update the contents of any lender list on an annual basis.
+ National Student Loan Data System (NSLDS):
+ Loan Entrance and Exit Counseling:
All student loan borrowers must also receive loan exit counseling before leaving school. Exit counseling can also be done at https://studentloans.gov.