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Student Loans

Federal Direct Loans

If you have not already done so, you must file the Free Application for Federal Student Aid (FAFSA) prior to borrowing a Federal Direct Loan. Your loan eligibility is listed on your Award Notification.

The Federal Direct Loan is available to undergraduate students to assist with paying college costs.  The type of Federal Direct Loan a student is awarded is based on results of the FAFSA (Free Application for Federal Student Aid). If subsidized, the loan is based on need and interest is paid by the federal government while the student is enrolled at least half-time. If unsubsidized,  the student is responsible for the interest accumulated on the loan while still in school. Repayment of the principal is deferred for either loan type.   A federal origination fee of 1.073% will be charged for the 2015-2016 academic year.

Interest rates:  For subsidized loans disbursed after July 1, 2015, the interest rate is fixed at 4.66%.  For unsubsidized loans disbursed after July 1, 2015, the interest rate is also fixed at 4.66%.   

 Loan limits: First-year - $5,500*
                Sophomore - $6,500*
                Junior and Senior - $7,500*

* A minimum of $2,000 will be Unsubsidized Stafford Loan eligibility.  

Loan repayment begins six months after graduation or dropping below half-time status.  Loan eligibility will be provided on the student's Award Notification each year.

First-time Federal Direct Loan borrowers must complete the following items before the loan proceeds can be disbursed to the student's Augustana account.  Please note that the Direct Loan will not appear as a credit on the student account/tuition bill until both the MPN & entrance counseling have been completed.

1) Federal Direct Loan Master Promissory Note (MPN)

2) Federal Direct Loan Entrance Counseling

1) Federal Direct Loan Master Promissory Note (MPN)

All students wishing to borrow the Federal Direct Loan for 2015-2016 must complete a Master Promissory Note (MPN). By selecting the link below, you will be redirected to the Direct Loans Master Promissory Note site to complete your MPN. You will need your federal PIN (personal identification number) to complete your MPN. Your PIN is also used to file your FAFSA. If you do not have a PIN, you should apply for one at www.pin.ed.gov before you attempt to complete your MPN. Please note: The Financial Assistance Office does not have access to your PIN.

The Financial Assistance Office will be notified electronically when you have finished your MPN.

2) Federal Direct Loan Entrance Counseling

First-time borrowers must also complete Federal Direct Loan Entrance Counseling. If you are a current Augustana student and have borrowed a Federal Direct Loan in the past, you do not need to complete Entrance Counseling again.

By selecting the link below, you will be redirected to the Direct Loan Servicing website to complete entrance counseling.  Please click on "Entrance Counseling" on the left-hand menu.  The Financial Assistance Office will be notified when you have finished.

3) Federal Direct Loan Exit Counseling

Students whose enrollment drops below half-time (4 credits) for any reason (i.e. graduation or withdrawal) and have borrowed through the Federal Stafford Loan program must conduct Exit Counseling through the Financial Assistance Office.  The purpose of Exit Counseling is to inform you about the repayment or deferment of your Federal Direct Loan(s).  The Exit Counseling booklet is available by contacting Financial Assistance.

Exit Counseling can also be completed online on the Federal Direct Loan Servicing website listed below.  Please click on "Exit Counseling" on the left-hand menu.  Financial Assistance will be notified when Exit Counseling has been completed.

 

Alternative/private loans for students

Alternative/private loans are credit based loans offered by some banks and credit unions to students to help cover allowable educational expenses not covered by financial aid.  Alternative/private loans are not part of the federal loan program and not guaranteed by the federal government.  Typically, alternative/private loans:  

     •  Require a credit worthy co-signer, with U.S. citizenship or permanent resident status 
     •  Can have fixed or variable interest rates
     •  Have an interest rate based on a financial benchmark such as Prime or LIBOR plus a margin that is usually based on
         the creditworthiness of the borrower and cosigner
     •  Accrue interest while a student is in school
     •  May require repayment while you are still in school

Prior to borrowing alternative/private loans, you should:

    •  Apply for and be sure all federal, state and institutional funds have been utilized.
    •  Compare federal and alternative/private loans at the Federal Student Aid website.
    •  Know the amount that you really need to borrow and don't borrow more than you need.  Contact the Financial
        Assistance Office if you are unsure of the amount you need to borrow.

Because of the more favorable interest rates and repayment terms of the federal student loans, private loans should be considered after federal loans have been used, and the PLUS loan for parents has been considered.

While federal student loans should be a first choice, we understand that some students will choose to borrow from private lenders.  Augustana College does not have a preferred lender list or any type of preferred lender arrangement.  We have compiled a list of lenders that our students have used over the past three years.  Augustana does not promote, recommend or endorse any lender on the linked list below.  Augustana College will process private/alternative loans through any lender of your choice; you are not limited to the lenders on this list.

Lenders Used by Augustana Students Over the Past Three Years

If you are considering borrowing an alternative/private loan, we recommend applying by July 15 for ample processing time.


Private Education Loan Applicant Self-Certification Form

Students applying for alternative/private loans must complete and submit to their lender a Private Education Loan Self-Certification Form prior to the processing of the loan by the lender.  Please call the Office of Financial Assistance if you need additional help completing the form.


Code of Conduct for Education Loans

The Higher Education Opportunity Act of 2008 (HEOA) requires institutions of higher education to establish and follow a Code of Conduct with respect to student loans that prohibits conflicts of interest for any financial aid professional [HEOA § 487(a)(25)].  In accordance with this requirement, each staff member of the Office of Financial Aid at Augustana College signs the following conflict of interest policy and code of conduct on an annual basis.

Augustana College Code of Conduct for Education Loans