Understanding Financial Aid (How your financial aid is calculated) Types of Direct Loans Grade Levels, Aggregate Loan Amounts Grace Period – Deferment Options Student Loan Repayment Using Your Student Loan Money Wisely Delinquency - Consequences Loan Application Process Your Responsibility as a Borrower - Reminders
Financial aid allows you to obtain a college education. It is important to know the eligibility requirements for federal and state grants. Federal Student Aid Video Grants: Federal and state grants provide students with financial assistance and in most cases, DO NOT HAVE TO BE REPAID. Eligibility may vary. Tuition Waiver: The California College Promise Grant (BOGW), waives the tuition only ($46 per unit). There is no monetary value for this waiver. It is applied to your account. Scholarships: Scholarships are often based on academic merit, a specific program of study, special talents, etc. These can be awarded by private donors, agencies, businesses, and organizations. Be aware of scholarship scams. William D. Ford Federal Direct Loans: Loans made to students directly through the U.S. Department of Education
Cost of Attendance – Institutional Budget A student can never exceed the COA and loan amount ceilings EFC – Expected Family Contribution The expected family contribution is an amount that a family is expected to contribute towards a student’s college education. The EFC is calculated by the Federal Government when you file a FAFSA application. Calculating your Need: COA (Cost of Attendance) – (EFC) – (Financial Aid) = Unmet Need
Cal l State Fu Fulle llert rton C Curr rrent C COA SCC Cu SCC Current CO COA Enrollment Undergrad. Undergrad in Dorm Enrollment Living Away from Commuter w/parent Parent(s) 2 Semester 2 Semester 2 Semester 2 Semester $6,933 $6,933 Fees Fees $ 1,338 $ 1,338 $2,058 $2,058 Books & Books & Supplies $ 1,917 $ 1,917 Supplies $6,096 $15,852 Food & Housing $ 6,786 $15,084 Room/Board $1,578 $1,472 Transportation $ 1,134 $ 1,278 Transportation $1,704 $1,704 Personal Expenses $ 3,564 $ 3,996 Misc. $60 $60 Total: $14,739 $23,613 Loan Fee $18,429 $28,079 Total:
Subs bsid idiz ized Unsubsidiz idized Are for undergraduate students with Are not based on financial need demonstrated financial need, as determined by federal regulations No interest is charged while you are in Interest is charged during all periods, even school at least half-time and during during the time you are in school and deferment periods during grace and deferment periods Current interest rate for 2019-2020 loans is 4.53% with an origination fee of 1.062% For current interest rates and origination fees click the following link: https://studentaid.ed.gov/sa/types/loans/subsidized-unsubsidized Dire Direct P Plu lus L Loans: : Are unsubsidized loans for the parents of dependent students and for graduate/professional students. Interest is charged during all periods. Current interest rate is: 7.08% with an origination fee of 4.248%
You must always be actively enrolled AND attending in at least 6 payable units AT ALL TIMES . This applies to late start classes. Full Time: 12 units or more Three Quarter Time: 9-11.9 units Half Time: 6-8.9 units
* Time limitation on Direct Subsidized Loan Eligibility for FIRST-TIME BORROWERS on or after July 1, 2013 – in general you may not receive Direct Subsidized Loans for more than 150% of the published length of your program. (AA/AS degree = 3 years max) Refer to your loan packet for further information. School Policy: *The Financial Aid Appeals Committee reserves the right to decline any student loan request to students not carrying a full-time load and/or have already exceeded over 90 attempted units. *Any future borrowing request may be declined if the student has reached at least half of the students entire undergraduate eligibility.
Subsidized and/or Dependent Independent Unsubsidized Student Student Grade Level One: $ 3,500 $ 3,500 1-29 units completed $1,750 per semester $1,750 per semester Grade Level Two: $ 4,500 $ 4,500 30+ units completed $2,250 per semester $2,250 per semester Additional Unsubsidized $ 2,000* $ 6,000* $1,000 per semester $3,000 per semester
The Grace Period is a set period of time after you graduate, leave school, or drop below half-time enrollment before you must begin repayment on your loan. The grace period gives you time to get financially settled and to select your repayment plan You only get ONE , and it only lasts 6 months You will receive your repayment obligation, which includes: • Date payments are to begin (Payment is expected even if you do not receive a payment booklet) • Monthly payment amount • Repayment terms • Current principal balance • Interest Rate
An authorized period of time during which you can postpone payment on your loan. Interest does not accrue on subsidized loans, however any unsubsidized loans, interest will continue to accrue. Examples of Deferments: In school at least half-time after a there has been a lapse in enrollment In a graduate fellowship program In an approved rehabilitation program Unable to find full-time employment Experiencing economic hardship Refer to the Exit Counseling for more details
Standard Repayment Plan Payments are a fixed amount that ensures your loans are paid off within 10 years (within 10 to 30 years for Consolidation Loans). Graduated Repayment Plan Payments are lower at first and then increase, usually every two years, and are for an amount that will ensure your loans are paid off within 10 years (within 10 to 30 years for Consolidation Loans). Extended Repayment Plan Up to 25 years, payments may be fixed or graduated in amount that ensures that your loan will be paid in full in 25 years Income Based Repayment (IBR) Up to 25 years, with forgiveness of any remaining balance-payments will be the lesser of 15% of your income or 10 year standard plan Pay as You Earn Repayment Your monthly payments will be 10 percent of discretionary income, but never more than you would have paid under the 10-year Standard Repayment Plan. Payments are recalculated each year and are based on your updated income and family size. You must update your income and family size each year, even if they haven’t changed. Income Contingent Repayment Up to 25 years with forgiveness of any remaining balance-payments will be lesser of 20% of income OR the amount you would pay on a 10-year Standard Repayment multiplied by a percentage based on your income. Repayment Options Video
Use student loan money ONLY LY for school-related expenses, such as tuition, housing, books, transportation, and food. You may send any loan money not needed for educational purposes back to your servicer. The more loans you receive now, the more money you are required to repay later, for example: $ 4,500 Loan Amount -OR- $ 6,000 Loan Amount 5% Interest Rate (Estimated) 7.6% Interest Rate (Estimated) 114 Number of Monthly Payments 120 Number of Monthly Payments $ 50 Monthly Payments $ 72 Monthly Payments $5,662 Total Loan Amount $8,584 Total Loan Amount
Failure to make payments when due can lead to delinquency and can lead to default To DEFAULT means you failed to make your payments on your student loan as scheduled according to the terms of your master promissory note (the binding legal document you signed at the time you took out your loan) . Consequences of Default: • Default will remain on your credit score for a minimum of 7 years • Damage to your credit rating which could prevent you from buying a car/home/etc. • Garnishment of your wages • Legal action against you • Loss of deferment eligibility • Loss of your professional license • Withholding of your federal and state income tax refunds
Origination : The following documents/steps must be submitted/completed before origination of your loan can be processed. Complete online Entrance Counseling at www.studentloans.gov (Refer to packet instructions) 1. Complete the Master Promissory note at www.studentloans.gov 2. Complete the Direct Loan Request form, Required Components Form, and Reference Sheet. 3. Accept your loan award on your WebAdvisor (Self-Service). 4. If you borrow unsubsidized loans, the financial aid office will accept the award on the student’s behalf .
MPN DEFINITION: MPN must have the following: Promise to Pay SSN (Social Security Number) Legally Enforceable Driver’s License/State issued ID # Terms and Conditions E-mail address Rights and Responsibilities References: Must be 2 different addresses Valid for 10 years from the date signed MPN MUST BE COMPLETED ON
All online components must be completed at the following website: www.studentloans.gov You must use this website to complete the following: 1. Entrance Counseling 2. Master Promissory Note (MPN) 3. Exit Counseling All SCC borrowers must complete the Exit Counseling before the end of the school year! Also: Deferment/Forbearance All Loan Servicing needed
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