Educational Loan Programs

FEDERAL PERKINS LOAN

The Federal Perkins Loan is a need-based, low interest (5%) fixed rate loan. The standard repayment period is 10 years. There are no processing fees. Funds are limited; levels are based on repayments from previous borrowers. No Interest accrues and no repayment is expected while a student is enrolled in an institution of higher education at least half-time and for nine months thereafter. 

FEDERAL DIRECT STAFFORD LOAN

Through the William D. Ford Direct Lending Program, borrowers receive federal loan funds directly from the U.S. Department of Education. For need-based subsidized loans, the federal government pays the interest until the loan goes into repayment status, usually six months after the student is no longer enrolled at least half-time. The unsubsidized version of the loan has the same terms and conditions except the borrower are responsible for the interest that accrues while they are in school.

• UNDERGRADUATE STUDENTS: The interest rate on new Subsidized Stafford Loans is fixed at 3.4% from July 1, 2011 through June 30, 2012.
• GRADUATE STUDENTS: The interest rate on new Subsidized Stafford Loans is fixed at 6.8% for the 11-12 Academic Year.
• ALL STUDENTS: The interest rate on a new Unsubsidized Stafford Loan is fixed at 6.8% for the 11-12 acadenic year.
• A fee of .5% is deducted from the loan amount at every disbursement.
• For loans disbursed prior to July 1, 2006, the interest rate continues to be a variable rate based on the 91-day T-bill.
• Repayment begins six months from the date of graduation, withdrawal or enrollment less than half-time.
• There is no pre-payment penalty.

NEW STAFFORD LOAN BORROWERS AT CHAMPLAIN COLLEGE MUST COMPLETE A MASTER PROMISSORY NOTE (MPN) AND ENTRANCE COUNSELING SESSION ONLINE AT WWW.STUDENTLOANS.GOV.

FEDERAL DIRECT PLUS LOAN

The Federal Direct PLUS Loan Program provides a borrowing option for parents of dependent undergraduate students to help finance their student's education. The maximum amount a parent can borrow is the cost of attendance less other sources of financial aid. The student's award letter will indicate the maximum amount eligible. This amount can be reduced or declined; no parent is required to borrow a Federal Direct PLUS Loan.

The funds are borrowed directly from the U.S. Department of Education. This is a credit based loan. The interest rate is fixed at 7.9%, and there is a 2.5% fee deducted from every disbursement. Interest accrues from the first date of disbursement. Repayment begins after the loan is fully disbursed; however, deferment options are available to delay repayment. There is no pre-payment penalty.

To borrow through the Federal Direct PLUS Loan program the parent must pass a credit check, which is valid for 90 days. Parents without adverse credit will be approved for the loan. Adverse credit is defined by regulation as: 90 days or more delinquent on any debt or having a credit report that shows a default determination, bankruptcy discharge, foreclosure, repossession, tax lien, wage garnishment, or write-off of a Title IV debt, during the five years preceding the date of the credit report. Parents denied a Federal Direct PLUS Loan will be offered the option to appeal or apply with a credit-approved endorser. 

PARENTS INTENDING TO BORROW A PLUS LOAN WILL NEED TO COMPLETE A MASTER PROMISSORY NOTE (MPN) AND PLUS APPLICATION ONLINE AT WWW.STUDENTLOANS.GOV.  IN SUBSEQUENT YEARS, ONLY THE PLUS APPLICATION WILL NEED TO BE COMPLETED.  THE MPN IS VALID FOR 10 YEARS AFTER A LOAN HAS BEEN ISSUED FROM IT.

FEDERAL DIRECT GRADUATE  PLUS LOAN

The Federal Direct Graduate PLUS Loan Program provides a borrowing option for graduate students to help finance their education. The maximum amount a graduate student can borrow is the cost of attendance less other sources of financial aid. The graduate student's award letter will indicate the maximum amount eligible. This amount can be reduced or declined; no student is required to borrow a Federal Direct Graduate PLUS Loan.

The funds are borrowed directly from the U.S. Department of Education. This is a credit based loan. The interest rate is fixed at 7.9%, and there is a 2.5% fee deducted from every disbursement. Interest accrues from the first date of disbursement. Repayment begins after the loan is fully disbursed; however, deferment options are available to delay repayment. There is no pre-payment penalty.

To borrow through the Federal Direct Graduate PLUS Loan program the student must pass a credit check, which is valid for 90 days. Students without adverse credit will be approved for the loan. Adverse credit is defined by regulation as: 90 days or more delinquent on any debt or having a credit report that shows a default determination, bankruptcy discharge, foreclosure, repossession, tax lien, wage garnishment, or write-off of a Title IV debt, during the five years preceding the date of the credit report. Students denied a Federal Direct Graduate PLUS Loan will be offered the option to appeal or apply with a credit-approved endorser.

STUDENTS  INTENDING TO BORROW A GRADUATE PLUS LOAN WILL NEED TO COMPLETE A MASTER PROMISSORY NOTE (MPN) AND GRADUATE PLUS APPLICATION ONLINE AT WWW.STUDENTLOANS.GOV.  IN SUBSEQUENT YEARS, ONLY THE GRADUATE PLUS APPLICATION WILL NEED TO BE COMPLETED.  THE MPN IS VALID FOR 10 YEARS AFTER A LOAN HAS BEEN ISSUED FROM IT.

PRIVATE EDUCATION LOANS

Private loans are non-federal, credit-based education loans, borrowed from a private lending institution that must be repaid. The loans are typically issued in the student's name with a required co-signer. The maximum amount a student may borrow is the cost of attendance minus any other financial aid or the maximum limit established by the lender. Families are encouraged to fully explore federal loan options, (e.g. Perkins, Direct Subsidized, Direct Unsubsidized, and Direct PLUS Loans), before securing a private loan due to the benefits and consistencies that the federal loan programs provide. Funds are posted to the student's account each semester following enrollment verification, which generally occurs after the second week of the semester.

Selecting a private education loan and lender is a personal decision. The Office of Financial Aid strongly recommends researching private education loans and lenders before completing a loan application online or signing any loan paperwork. Research should include: a comparison of interest rates, fees, repayment terms, and the level of customer service provided by the lender.

Comparison chart for Parent PLUS and Private Educational Loan