Student Financial Services - Loan Information

BORROWING LIMITS – FEDERAL STAFFORD LOANS for 2007 - 2008

Currently, freshmen may borrow up to $3,500, sophomores $4,500, and juniors and seniors may borrow up to $5,500 per academic year from the Federal Stafford Loan program. Graduate students may borrow up to $18,500 per year (not to exceed the cost of attendance). Independent students may borrow additional funds under the unsubsidized component.

Subsidized means the government is paying the interest while you are in school. You do not start repaying the interest or principal until six (6) months after you drop below six (6) credits, withdraw or graduate. Unsubsidized means that you, rather than the government, are responsible for the interest while you are in school. You may wish to have the interest capitalized and should discuss this option with your lender.

All loans are subject to origination and guarantee fees which are paid to the federal government and the guaranty agency to help offset administrative costs and to guarantee loans. Unlike grants or scholarships, all loans you borrow must be repaid. We urge you to borrow conservatively. Do not borrow more than you need.

Loans will remain at the level we certified unless the student indicates otherwise. If a student wishes to reduce their current student loan, the student must fill out a Loan Change Request Form and submit it to our office. This form can be obtained by stopping into our office or through the Student Financial Services page, where you can either download the application or complete the online form.

If a student changes academic grade levels during the course of the year, it is the student’s responsibility to notify our office of the change. This is done by filling out the loan change request form. The student should indicate the reason for the change is due to a change in grade level.

Note: A Student must be registered for at least 6 credits (two classes) in order to be eligible to receive Stafford Loans.

THE APPLICATION PROCESS

Please follow these important steps to apply for a Federal Stafford Loan.

1. File the electronic or paper version of the 2007-2008 FAFSA and put either a 2 or 3 in question 26.
2. The pre-certification step is the most important step in the loan process. During this step the Office of Student Financial Services will notify the student of his/her maximum Federal Stafford Loan eligibility and type of Federal Stafford Loan (subsidized and/or unsubsidized) based on the student’s financial need and grade level. The student will have an opportunity to either decline and/or reduce his/her Federal Stafford Loan estimate by returning the enclosed "2007-2008 Loan Information/Change Form" to the Office of Student Financial Services.
3. The Office of Student Financial Services will transmit your Federal Stafford Loan information to AES/PHEAA. If you have never completed a Federal Stafford Loan promissory note, you will receive a pre-printed Federal Stafford Loan Master Promissory Note packet from AES/PHEAA. Please note: The Master Promissory Note only needs to be completed once every ten years.
4. Complete the Master Promissory Note and entrance counseling electronically by logging onto AES/PHEAA. With your U.S. Department of Education PIN, you can even sign your Master Promissory Note electronically. If you need a U.S. Department of Education PIN, you can request one by logging at the PIN registration website.

Whether completing a pre-printed paper or electronic Master Promissory Note, AES/PHEAA will send you an "Approval Notice." This notice will indicate the amount of your loan(s), the interest rate and the disbursement dates of your loan(s). If you are not interested in a Federal Stafford Loan, do not complete or return this Master Promissory Note. You will have an additional opportunity at this point to cancel or reduce your Federal Stafford Loan by contacting The Office of Student Financial Services. AES/PHEAA will authorize the disbursement of loan funds at the appropriate time, via Electronic Funds Transfer or check, to Mercyhurst College.

SELECTING A LENDER

If you are planning to use Federal Stafford Loans to assist in paying for your educational expenses at Mercyhurst College, we have some important information to share with you.

To utilize the Federal Stafford Loan, each student must successfully complete a Master Promissory Note and Entrance Counseling. This can be done online at www.aessuccess.org. We recommend you complete both of these requirements between June 1, 2007, and Aug. 1, 2007.

If you have any student loan questions, please feel free to contact the Office of Student Financial Services at (814) 824-2288 or studentfinsvcs@mercyhurst.edu

PARENT PLUS LOANS

Some parents find it necessary to take out an additional loan in order to help fund their son/daughter’s education. Parents may consider borrowing a parent Plus loan. Parents will need to obtain a Mercyhurst College Pre-Application for a Parent Plus Loan which are available in our office.

ALTERNATIVE LOANS

Some students will find it necessary to take out an additional loan in order to bridge the gap in financing their education. Students in this situation may want to consider an alternative loan.

LOAN CHECKS/DISBURSEMENT - ELECTRONIC FUNDS TRANSFER

Your loan amount will be disbursed in three installments. By Federal Government regulations, first time borrowers are required to wait 30 days after the start of the loan period to receive their first disbursement. Loan monies are disbursed directly to the student’s account. In most cases, your monies will be disbursed electronically.

YOUR RIGHTS AND RESPONSIBILITIES AS A STUDENT LOAN BORROWER

Education loans are serious obligations. It is extremely important that you understand your rights and responsibilities.

Borrower Rights

At or before the time your lender gives you your first loan payment, your lender must also give you complete information such as:

• The full amount of your loan, the interest rate, and when you must begin repayment.
• A complete list of charges connected with making the loan, including whether those charges are deducted from the loan, or if you must pay them separately.
• The yearly and total amounts you can borrow, and the maximum and minimum repayment periods.
• An updated statement of all the loans you owe to your school, an estimate of what you total debt will be, and what your monthly payments will be.
• An explanation of default and its consequences.
• An explanation of refinancing and consolidation options.
• A statement of deferment condition and the conditions under which the Department of Defense will repay your loan.
• A reminder that you can repay the entire balance and interest at any time without penalty.
• Your loan check must be payable to you and the school.
• You have a right to federal interest benefits, if you qualify.

Borrower Responsibilities

You, the borrower must:

• Repay your loan according to the repayment schedule.
• Notify your lender immediately if you cannot repay your loan.
• Notify your lender immediately if you graduate or withdraw from school.
• Notify your lender is you transfer to another school.
• Notify your lender if you drop below half-time status.
• Notify your lender if you change your name, address, or social security number.
• Notify your lender of anything that affects your ability to repay your loan.
• Attend an entrance interview (for first time borrowers) before you endorse the loan check, and attend an exit interview (for all borrowers) before you leave school.

STUDENT CONSUMER RIGHTS AND RESPONSIBILITIES

You have the right to ask a school:

• The name of its accrediting organizations.
• About its programs, it’s instructional, laboratory, and other physical facilities, and its faculty.
• What the cost is and what its policies are on refunds to student who drop out.
• What financial assistance is available, including information on all federal, state, local, private, and institutional financial aid programs.
• What the procedures and deadlines are for submitting applications for each available financial aid program.
• What criteria are used to select financial aid recipients.
• How your financial need is determined. This process includes how cost for tuition and fees, room and board, travel, books and supplies, personal and miscellaneous expenses are considered in your educational budget. It also includes what resources (such as parent’s and student’s contribution and other financial aid) are considered in the calculation of your financial need.
• If you are offered a work-study job, you have the right to know what kind of job it is, what hours you must work, what your duties will be, what the rate of pay will be, and how and when you will be paid.
• To reconsider your aid package, If you believe a mistake has been made.
• What special facilities and services are available to the handicapped.

It is your responsibility to:

• Review and consider all information about a school’s program before you enroll.
• Pay special attention to your student financial aid application, complete it accurately, and submit it on time to the right place. Errors can delay your receiving financial aid.
• Provide all additional documentation, verification, corrections, and/or new information requested by either the financial aid office or the agency to which you submitted your application.
• Read and understand all forms that you are asked to sign and keep copies of them for your record.
• Accept responsibility for the promissory note and all other agreements that you sign.
• Perform in satisfactory manner the work that is agreed upon accepting a college work-study job.
• Know and comply with the deadlines for application or reapplication for aid.
• Know and comply with your school’s refund procedures.