college loans- frequently asked questions

1. What is the difference between Stafford Loans and private loans?
2. What is the difference between subsidized and unsubsidized student loans?
3. What are the loan limits on the Stafford loans?
4. What is a Perkins Loan?
5. What is a Graduate PLUS Loan?
6. What are the eligibility requirements of PLUS loans?
7. Aside from interest rate fees, are there any other fees associated with PLUS loans?
8. I have already submitted a FAFSA for this school year. Can I submit another FAFSA using FAFSA on the Web?
9. I submitted two applications for the same year. What will happen?
10. Who is eligible to receive federal student aid?
11. How do I keep track of the student aid I have received?
12. What is the Expect Family Contribution (EFC)?
13. What is a Student Aid Report (SAR)?
14. What is the AACSB?

1.) What is the difference between Stafford Loans and private loans?
Stafford loans require the student to fill out a FAFSA form, private loans do not. Some of the other typical differences are Stafford (Federal) loans are capped by the annual borrowing amount, awarded based on need by student, and have fixed interest rate. However, students may be able to borrow significantly more than through federal loans. In addition, private student loans tend to be variable interest rates and do not provide the student with a grace period after graduation.

2.) What is the difference between subsidized and unsubsidized student loans? – In Stafford subsidized loans, the government pays the interest while the student is enrolled in school. In Stafford unsubsidized loans, the student is responsible for the interest payments but can defer payment until after graduation.

3.) What are the loan limits on the Stafford loans?

Annual and aggregate amounts depend on whether it is a undergraduate or undergraduate loan, details can be found at studentaid.ed.gov.

4.) What is a Perkins Loan?
Federal loan intended for needy students interested in postsecondary education. The loan offers a low-interest rate.

5.) What is a Graduate PLUS Loan?
PLUS loans are Parent Loans for Undergraduate Students. However, graduate and professional students are eligible to apply for these loans. The applicant must not have an adverse credit history and repayment begins on the date of the last disbursement of the loan.

6.) What are the eligibility requirements of PLUS loans?
PLUS applicants must meet the general eligibility requirements for federal student aid. If a parent is borrowing on behalf of a dependent undergraduate student, the student must also meet these general eligibility requirements. The parent should not have an adverse credit history. If the parent’s credit history is poor, he / she can have a co-signor to agree to repay the loan in the event of default. For example, the PLUS applicant and the student must:

• be a United States citizen or Eligible Noncitizen,
• not be in Default on a federal student loan, and
• not owe a refund on a federal education grant

7.) Aside from interest rate fees, are there any other fees associated with PLUS loans?
Yes there is a fee of up to 4% of the amount of the loan.

Source: studentaid.ed.gov

8.) I have already submitted a FAFSA for this school year. Can I submit another FAFSA using FAFSA on the Web?

No. If you have already submitted a FAFSA (for instance, your school already submitted an electronic application for you, you submitted a paper FAFSA, or you filed for aid using FAFSA on the Web), do not submit another application.

For more information please visit the FAFSA home page

9.) I submitted two applications for the same year. What will happen?

Only the first application submitted will be reviewed. All other applications are deleted from the system.

To make corrections to your application, view your Student Aid Report (SAR). You will receive it either by e-mail or by mail. The SAR includes instructions for making corrections.

You can use Corrections on the Web to make your changes, or you can make the corrections to your paper SAR and mail it in.

You may also check with the financial aid office at your school to determine if they can make electronic corrections for you.

10.) Who is eligible to receive federal student aid?
To receive federal student aid, you must meet certain requirements. You must:

• Be a U.S. citizen or eligible noncitizen.
• Have a valid Social Security Number (unless you’re from the Republic of the Marshall Islands, the Federated States of Micronesia, or the Republic of Palau).
• Be registered with Selective Service if you are male and 18 to 25 years of age (go to www.sss.gov for more information).
• Have a high school diploma or a General Education Development (GED) Certificate or pass an exam approved by the U.S. Department of Education.
• Be enrolled or accepted for enrollment as a regular student working toward a degree or certificate in an eligible program at a school that participates in the federal student aid programs.
• Not have a drug conviction for an offense that occurred while you were receiving federal student aid (such as grants, loans, or work-study).

Also:

• You must not owe a refund on a federal grant or be in default on a federal student loan.
• You must demonstrate financial need (except for unsubsidized Stafford Loans).

Please contact your school’s financial aid office to verify whether there are any other requirements.

11.) How do I keep track of the student aid I have received?
The National Student Loan Data System website provides a history of any federal aid provided to the student.
Source: www.fafsa.ed.gov

12.) What is the Expect Family Contribution (EFC)?
The Expected Family Contribution (EFC) measures your family’s financial strength, and is used to determine your eligibility for federal student aid during one school year. You receive an EFC based on the processing results of your FAFSA. You can receive more information through your school’s financial aid administrator. Visit the studentaid website’s EFC Formula to understand how the formula is calculated.

13.) What is a Student Aid Report (SAR)?
A Student Aid Report (SAR) is a document you will receive after your FAFSA is processed. Your SAR will list all of the answers you provided on your FAFSA. You should review these answers carefully to make sure they are correct.
TIP: If you need to make any changes, select Make Corrections to a Processed FAFSA under the FAFSA Follow-Up section of the home page. You can also make corrections on the paper SAR, if you received one, and mail it back to the address provided.
Your SAR will contain your Expected Family Contribution (EFC), which measures your family’s financial strength and is used to determine your eligibility for federal student aid. Your school will use this number to determine how much financial aid you are eligible to receive based on your school’s cost of attendance.
If you did not provide electronic signatures or paper signature pages with your FAFSA, you must sign the paper SAR you will receive and mail it back to the address provided for final processing.

14.) What is the AACSB?
The AACSB stands for Association to Advance Collegiate Schools of Business. The AACSB is the premier accrediting agency of collegiate business schools and accounting programs worldwide. Schools must satisfy the specific standards in order to be accredited, and less than 5% of the world’s business schools have achieved this status.

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