Federal Direct Loans
Borrowing money for college is
a serious financial obligation. Students are advised to borrow only what they actually need.
To be eligible to receive a Federal Direct Loan, you must be enrolled in six credit hours that count toward your degree at Seminole State College.
The interest rate for new subsidized and unsubsidized loans first disbursed on or after July 1, 2006, is a fixed 6.8 percent, with the exception for subsidized undergraduate loans noted in the table below. The interest rate for PLUS loans first disbursed on or after July 1, 2006, is a fixed 7.9 percent.
Federal Direct Subsidized Student Loans
A Federal Direct Subsidized Loan is need-based, and is available to help meet financial need after other resources are subtracted or to the annual maximum loan limit, whichever is lower. Interest does not accrue while the student is enrolled at least half-time (six credit hours at Seminole State College) in an eligible program plan or during periods of approved deferments. It is the U.S. Department of Education's major form of self-help aid and is available through the William D. Ford Federal Direct Loan Program. Review the table below for annual and aggregate loan limits.
Note: New law has eliminated the interest subsidy provided during the six-month grace period for subsidized loans for which the first disbursement is made on or after July 1, 2012, and before July 1, 2014. If you receive a subsidized loan during this timeframe, you will be responsible for the interest that accrues while your loan is in the grace period. This provision does not eliminate the interest subsidy while the borrower is in school or during eligible periods of deferment.
|First Disbursement of a Subsidized Loan for Undergraduate Students||Interest Rate on the Unpaid Balance|
|Made on or After...||And Made Before...|
|July 1, 2008
||July 1, 2009
|July 1, 2009
||July 1, 2010
|July 1, 2010
||July 1, 2011
|July 1, 2011
||July 1, 2013
For more information on interest rates, refer to the Federal Student Aid website.
Federal Direct Unsubsidized Student Loans
A Federal Direct Unsubsidized Loan is not based on your financial need. It is available to you through the William D. Ford Federal Direct Loan Program, if your estimated Cost of Attendance (COA) is greater than your financial aid and you have not reached your annual maximum loan limit through the Federal Direct Subsidized Loan. The interest rate for Federal Direct Unsubsidized loans disbursed on or after July 1, 2006, is fixed at 6.80 percent. You are charged interest on this loan from the time the loan is disbursed until it is paid in full. If the interest is allowed to accumulate, the interest will be added to the principal amount of the loan and increase the amount to be repaid.
By law, the total origination fee for loans made on or after July 1, 2012 is 1.0 percent for Direct Subsidized and Unsubsidized Stafford Loans. For more information on interest rates go to the Direct Loan Servicing Center.
How much can I borrow?
Maximum Annual and Lifetime Aggregate Limits Chart
Subsidized and Unsubsidized Direct and FFEL Stafford Loans
Independent Students and Dependent Students whose Parents are denied PLUS Loans
Freshman Annual Limits
$5,500 - No more than $3,500 can be in Subsidized Loans
$9,500 - No more than $3,500 can be in Subsidized Loans
Sophomore Annual Limits
$6,500 - No more than $4,500 can be in Subsidized Loans
$10,500 - No more than $4,500 can be in Subsidized Loans
Junior/Senior Annual Limits
$7,500 - No more than $5,500 can be in Subsidized Loans
$12,500 - No more than $5,500 can be in Subsidized Loans
Maximum Lifetime Limits
$31,000 - No more than $23,000 can be in Subsidized Loans
$57,500 - No more than $23,000 can be in Subsidized Loans
- You must have earned 30 college-level credit hours, which count toward your current degree program, to be eligible for sophomore-level loans. If you are earning an associate degree, you can not be considered anything higher than a sophomore at Seminole State College.
- If you have been accepted into a bachelor's degree program at Seminole State, you will be eligible for junior-limit loans once you have completed 60 college-level credit hours toward your bachelor's degree.
- The amounts in the chart above are the maximum amounts that you may borrow for an academic year. You might receive less than the maximum if you receive other financial aid that's used to cover a portion of your cost of attendance.
- Borrow responsibly as the aggregate limits are for your entire undergraduate career up to a bachelor's degree.
Steps to Apply for a Federal Student Loan at Seminole State College
- Apply for a Federal Direct Stafford (Subsidized and/or Unsubsidized) Loan
To apply for a Federal Direct Stafford (Subsidized or Unsubsidized) Loan, you must complete the FAFSA using our School Code of 001520. To be eligible, you must be enrolled for at least six credit hours that count toward your current degree and be maintaining satisfactory Standards of Progress. If you are eligible for a Federal Direct Stafford (Subsidized or Unsubsidized) Loan, it will be included on your financial aid services award.
- Accept, Reduce or Decline a Federal Direct Stafford Loan
You will have the option to Accept, Decline or Reduce your Federal Direct Stafford Loan and defer your fees through your MySeminoleState account.
- E-sign Your Federal Direct Stafford Loan Master Promissory Note
If you are a first time borrower of the Federal Direct Stafford Loan, you will be required to complete a Master Promissory Note (MPN) before the loan funds will be disbursed. In most cases, you will be required to complete one MPN during your college career at Seminole State College, provided you are borrowing a Direct Stafford Loan. You complete your Federal Direct Stafford Loan MPN by signing in to StudentLoans.gov with your Federal PIN.
- Loan Entrance Counseling
Before the Office of Student Aid can disburse your loan funds, you are required to complete Loan Entrance Counseling by signing in to StudentLoans.gov with your Federal PIN. This counseling session provides information that will help you understand your rights and responsibilities as a loan borrower, as well as other tools to assist you with managing your loans. In most cases, you will be required to complete Loan Entrance Counseling only once during your college career at Seminole State College.
- Receiving Federal Direct Stafford Loan Funds
It is important to know that loan funds will automatically credit to your student account if the Direct Loan Processor has a valid MPN on file for you and you have completed Loan Entrance Counseling. Your loan funds cannot be disbursed until you begin six credit hours during the semester and must be paid in two equal disbursements for each payment period (e.g. half of the loan in Fall Term and half in Spring Term).
- Loan Exit Counseling
Student borrowers are required to complete an Exit Counseling session when they drop below half-time or cease to enroll at the college.
Federal Direct Parent Loans for Undergraduate Students (PLUS)
Federal Direct Parent Loans for Undergraduate Students (PLUS) are long-term, non-need-based loans for parents of dependent undergraduate students. Under the PLUS Loan program, parents may borrow up to the full cost of their child's attendance (as defined by Seminole State's Financial Aid Office) less any financial assistance the child receives.
Interest Rate and Fee Information for the PLUS
The interest rate is fixed at 7.9 percent with a 4.0 percent origination fee. For more information on interest rates go to the Direct Loan Servicing Center.
PLUS Application Procedures for Parents and Student
- Student Completes a Financial Aid Application
The dependent student must submit a FAFSA and list Seminole State's school code (001520) on the application. He or she must also complete his or her To-Do List items in MySeminoleState.
- Parent Submits a Loan Application
The parent borrower must submit a Federal Direct PLUS Loan application, which is available online or in the College's Financial Aid Office.
- Parent E-Signs a Master Promissory Note
For PLUS funds to be disbursed, the parent borrower must complete a Master Promissory Note upon loan approval. This note is valid for future loans borrowed on behalf of the same student for up to 10 years.
By e-signing the Master Promissory Note, you authorize the Department of education to perform a credit check to determine your eligibility for the PLUS loan. If the parent's loan is denied, he or she may pursue a co-signer. For details, call the U.S. Department of Education at 800.433.3243, or review the Endorse PLUS Loan section of the Federal Student Aid website.
The Department of Education will notify Seminole State when the electronic Master Promissory Note is completed and accepted. (Note: When a co-signer is used, a new promissory note must be completed in order to apply for another loan.)
- Loan Funds are Disbursed
Once the application process is completed, PLUS Loan funds will be disbursed and credited to the student's billing account. If any funds remain after all charges are paid, the parent will receive the difference, unless he or she authorizes the amount to be released to the student.
PLUS Terms and Eligibility Criteria
The following criteria govern PLUS Loan eligibility:
- Borrowers must be deemed creditworthy.
- Borrowers and dependent students must be U.S. citizens or eligible non-citizens.
- Borrowers and dependent students must not be in default on any type of student loan or owe any education grant refunds.
- Dependent students must submit a Free Application for Federal Student Aid (FAFSA).
- Dependent students must be enrolled in a degree or certificate program on at least a half-time basis (six credit hours or more).
- Dependent students must have borrowed the yearly maximum allowed for Federal Direct Subsidized and Federal Direct Unsubsidized loans, which have better terms and interest rates than PLUS loans.
PLUS Loan Repayment
The PLUS Loan repayment period is calculated from the day after the loan is fully disbursed (usually around the beginning of April). Borrowers have 60 days from the final disbursement date to make their first payment.
It is not necessary to repay the principal prior to the official repayment start date; however, interest will be charged on the loan as soon as the first funds are disbursed. Interest fees can be paid quarterly or added to the loan balance. (Note: Adding interest fees to the loan balance will increase the principal upon which future interest is calculated and will ultimately increase the size and total cost of the loan.)
Deferred PLUS Payments
Repayment on PLUS loans first disbursed on or after July 1, 2008, can be deferred until six months after the dependent student ceases to be enrolled on at least a half-time basis. To request a deferment, borrowers must contact the Direct Lending Servicing Center at 800.848.0979.
Seminole State Debt Management Policies
- Loans will not be approved for any former or transfer students whose cumulative GPAs fall below a 2.0 or who are on financial aid suspension. Students will not be reconsidered for a loan until their suspensions are cleared.
- Students who have attempted 90 credit hours and not earned a degree (A.A. or A.S.) will no longer be considered to be making satisfactory academic progress. To be eligible for a loan, these students must submit a written explanation, which must be approved by Seminole State's Financial Aid Committee.
- Students who have previously defaulted on a student loan will not be approved for another loan at Seminole State until the defaulted loan is paid in full.
- Students who drop below half-time enrollment (six credit hours per term) must complete an Exit Interview.
Resources for Federal Direct Loan Borrowers