Federal Direct Loan Program

The Direct federal loan program enables eligible applicants to obtain student loans to meet their cost of attendance expenses. Students must be matriculated, Title IV eligible and enrolled in a minimum of 6 credits. Interest rates, fees and repayment terms are determined by federal statute and may vary according to the year students obtain their initial loans.

First-time borrowers must complete a Master Promissory Note (MPN) and Entrance Counseling at studentloans.gov to ensure that all borrower rights and responsibilities are understood. Loans cannot be disbursed until the entrance counseling and MPN have been completed.

Entrance Counseling

In accordance with federal regulations, first-time Direct loan borrowers must complete entrance counseling sessions on the web at studentloans.gov. During this counseling session students will learn about the terms of their loan and their rights and responsibilities as loan borrowers. No loans will be credited to a student’s account until entrance counseling is complete. Monroe College is part of an experimental site and some students have been chosen to complete Enhanced Loan Counseling.  oans cannot be disbursed to these students' accounts  until their  Enhanced Loan Counseling is completed each award year.

Federal Direct Subsidized Student Loan

The federal government pays the interest on behalf of student borrowers while students are enrolled at least half -time in college and during times of authorized deferment. Repayment of the loan begins six months after the student graduates or six months after the student’s enrollment status changes to less than half-time and/or is no longer matriculated.

Loan terms are determined by federal statute and may vary according to the year students obtain their initial loans. Students should go to studentloans.gov for the current interest rates.

If students were first-time borrowers on or after July 1, 2013, there is a limit on the maximum period of time (measured in academic years) for which they can receive Direct Subsidized Loans. In general, students may not receive Direct Subsidized Loans for more than 150% of the published length of their program of study.  This is called the student's maximum eligibility period. For example, using subsidized loans for more than 6 full-time semesters for the Associates Degree or for more than 12 full-time semesters for the Bachelor's Degree would be considered having reached the maximum eligibility period.  
After students have used Direct Subsidized Loans for their maximum eligibility period, they are no longer eligible to receive additional Direct Subsidized Loans.  Future loans will become unsubsidized.

 

Federal Direct Unsubsidized Student Loan

Unlike the subsidized loan program, interest on unsubsidized loans begins when the loan is disbursed and the interest is not paid by the federal government. Students have the option of paying these interest charges while attending school. If they choose not to pay the interest, it will accrue and be capitalized. Repayment of the loan and any accrued interest begins six months after the student graduates or six months after the student’s enrollment status changes to less than half-time and/or is no longer matriculated. Loan terms are determined by federal statute and may vary according to the year students obtain their initial loans. Go to studentloans.gov for the current interest rates.

Federal Loan Disbursements

Loan funds are usually disbursed to student accounts after the third week of each semester, contingent upon when the loan was originated. Students are notified via their Monroe email accounts when their loans have been disbursed to their Monroe billing account. They have 14 days from the receipt of the email to cancel their loans.

Federal Direct Parent Loan Program (PLUS)

The Parent PLUS Loan is available to parents of dependent students to help meet their children’s cost of attendance expenses. PLUS loan borrowers are subject to a credit check. If approved, parents are required to complete a Master Promissory Note (MPN) and PLUS loan repayment begins within 60 days of disbursement of funds. If denied, parents have the option to appeal the denial and/or use a second person to endorse the loan. The endorser must pass the federal credit check. Parents who successfully appeal or use an endorser must complete PLUS loan counseling. If the parent cannot get an endorser and chooses not to appeal the denial, the dependent student is eligible for additional unsubsidized loan funds. Loan terms are determined by federal statute and may vary according to the year the students obtain their initial loans. Go to studentloans.gov for the current interest rates.

Exit Counseling

All recipients of a Federal Direct Loan who withdraw, drop below six (6) credits, lose Title IV eligibility or graduate must complete an Exit Counseling session online at studentloans.gov.

During this counseling, students will be able to view their loan history and learn about deferral and repayment options.

Repayment: The repayment of Direct Loans begins six (6) months after a student graduates or drops below half-time matriculated status. The amount of the monthly repayment is calculated based upon the total amount that has been borrowed, as well as the repayment plan selected. Visit studentloans.gov and click on the link “Repayment Plans and Calculators” to learn more.