What is a Federal Direct Loan?
- The Federal Direct Loan Program is a cooperative effort between the federal government and educational institutions: (1) The federal government provides the loan funds, (2) schools determine the loan amount and interest subsidy, confirm eligibility, and determine the loan period.
- Direct Loan provides funds to help you meet your educational expenses. However, unlike gift aid, LOANS MUST BE REPAID.
- Federal Direct Loans are offered in two forms: subsidized and unsubsidized:
Subsidized: You will not be charged any interest while you are in school (as long as you remain at least a half-time student). The federal government subsidizes the interest during this period. Students receiving a subsidized loan first disbursement after July 1, 2012 and before July1, 2014 will be responsible for the interest that accrues on the loan during the six month grace period. Only available to undergraduate students who qualify.
Unsubsidized: You are responsible for your interest. Your interest accrues within sixty (60) days of disbursement and may either be paid while you are in school or capitalized and added to the principal amount borrowed. As with subsidized loans, principal payment begins six months after enrollment in an educational institution ceases.
How much can I borrow?
- Your total financial aid, including Federal Direct Loans, can never exceed the College’s cost of attendance. The limits indicated are the federal maximums which you can receive during two terms of enrollment.
- Students attending a 2 year community college may borrow up to “Second Year” annual loan limits.
- The maximum loan amount for one semester cannot exceed half of the academic year loan limit.
- In addition to annual loan limits, there are aggregate loan limits. Students may never borrow more than the aggregate loan limit for all subsidized and unsubsidized loans at Fletcher Technical Community College.
|First year (0 to 29 credits)||$5,500 |
No more than $3,500 of this
No more than $3,500 of this amount may be in subsidized loans.
|Second Year (30 or more credits)||$6,500 |
No more than $4,500 of this
No more than $4,500 of this amount may be in subsidized loans.
|Lifetime Limits||$31,000 |
No more than $23,000 of this
No more than $23,000 of this amount may be in subsidized loans.
Do I need a loan?
- Loans are borrowed money you MUST pay back to the federal government. Be smart, borrow what you can afford to repay. Failure to make payments and defaulting on your student loan can be the most damaging mark on your credit report, worse than bankruptcy.
- In deciding the appropriate amount to borrow, you should follow these steps:
- What are your costs for an academic year? Add your costs together for tuition/fees, room and board, books and supplies, transportation and personal expenses.
- Subtract your resources from these costs. Consider all aid and private scholarships you have received as well as money from savings and your family.
- Decide if you need to borrow. Review your expenses to see if you can reduce your costs.
- Refer to the repayment estimator at: http://studentaid.ed.gov/repay-loans/understand/plans/ to determine your monthly payment based on the amount you want to borrow. Remember to consider what you may want to borrow in the future years.
- Select the amount that you can manage to repay. What you borrow today must be repaid, with interest, in the future.
- All student loan funds will be disbursed through the Business Office at Fletcher onto your BankMobile card.
- Students must have submitted all required financial aid paperwork by the published deadline each semester to receive a disbursement. Late applications will be processed and awarded weekly. Depending upon the date of receipt, students who submit late applications will be expected to pay their tuition and fees prior to receipt of their award.
- Each semester, disbursements are issued approximately 4 weeks after the start of classes. Disbursements for late applicants will occur each week thereafter through the end of the semester.
- First Time Loan Borrowers: All first time loan borrowers are subject to at least a thirty (30) day delayed disbursement of loans funds for the semester.
- Loan Borrowers: Single semester loans will be issued in two disbursements; the second being after midterms.