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Last Updated: 11/30/2020 12:00 AM
 

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Applying for Federal Direct Stafford Student Loans

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Eligibility Requirements for Loans

  • Must have a FAFSA application and complete Verification file (if selected)
  • Must be in a Financial Aid eligible program
  • Must be enrolled in at least half-time (6 credits) of compliant coursework towards your degree at Valencia.
  • Must maintain Satisfactory Academic Progress

 

The following chart shows the annual and aggregate limits for subsidized and unsubsidized loans.

Loan Aggregate Limits, How much can I borrow?

College Year Dependent Students

Independent Students and Dependent Students whose Parents are denied PLUS Loans

Freshman - Annual Limits $5,500 - No more then $3,500 can be in Subsidized Loans $9,500 - No more then $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 then $4,500 can be in Subsidized Loans
Junior/Senior - Annual Limits $7,500 - No more then $5,500 can be in Subsidized Loans $12,500 - No more then $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 Associates Degree you can not be considered anything higher than a sophomore at Valencia.
  • If you have been accepted into a Bachelors Degree at Valencia you will be eligible for Junior limit loans once you have completed 60 college level credit hours toward your Bachelors 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.
  • If you are enrolled in a program that is less then one academic year in length, the annual limits will be prorated. 
  • Borrow responsibly as the aggregate limits are for your entire undergraduate career up to a bachelor's degree.

 

What are the interest rates for federal student loans?

The interest rate varies depending on the loan type and (for most types of federal student loans) the first disbursement date of the loan. The table below provides interest rates for Direct Subsidized Loans, Direct Unsubsidized Loans, and Direct PLUS Loans first disbursed on or after July 1, 2020, and before July 1, 2021.

Interest Rates for Direct Loans First Disbursed on or After July 1, 2020, and Before July 1, 2021.

Loan Type Borrower Type Fixed Interest Rate
Direct Subsidized Loans and Direct Unsubsidized Loans Undergraduate 2.75%
Direct PLUS Loans Parents and Graduate or Professional Students 5.30%

 

View the interest rates on federal student loans first disbursed before July 1, 2020.

Fees

Loan Type First Disbursement Date Loan Fee
Direct Subsidized Loans and Direct Unsubsidized Loans On or after 10/1/20 and before 10/1/21 1.057%
Direct PLUS Loans On or after 10/1/20 and before 10/1/21 4.228%

 

Most federal student loans have loan fees that are a percentage of the total loan amount. The loan fee is deducted proportionately from each loan disbursement you receive while enrolled in school. This means the money you receive will be less than the amount you actually borrow. You’re responsible for repaying the entire amount you borrowed and not just the amount you received.

 

Federal Direct Subsidized Loan

  • Direct Subsidized Loans are available to undergraduate students with financial need up to your Cost of Attendance.
  • Your school determines the amount you can borrow, and the amount may not exceed your financial need.
  • The U.S. Department of Education pays the interest on a Direct Subsidized Loan if: 
    • while you’re in school at least half-time
    • for the first six months after you leave school (referred to as a grace period*)
    • during a period of deferment (a postponement of loan payments)

Is there a time limit on how long I can receive Subsidized loans (Subsidized Usage Loan Applies –SULA)?

If you are a first-time borrower on or after July 1, 2013, there is a limit on the maximum period of time (measured in academic years) that you can receive Direct Subsidized Loans. This time limit does not apply to Direct Unsubsidized Loans or Direct PLUS Loans. If this limit applies to you, you may not receive Direct Subsidized Loans for more than 150 percent of the published length of your program. This is called your “maximum eligibility period.” Your maximum eligibility period is based on the published length of your current program. You can usually find the published length of any program of study in your school’s catalog.

For example, if you are enrolled in a four-year bachelor’s degree program, the maximum period for which you can receive Direct Subsidized Loans is six years (150 percent of 4 years = 6 years). If you are enrolled in a two-year associate degree program, the maximum period for which you can receive Direct Subsidized Loans is three years (150 percent of 2 years = 3 years).

Because your maximum eligibility period is based on the length of your current program of study, your maximum eligibility period can change if you change to a program that has a different length. Also, if you receive Direct Subsidized Loans for one program and then change to another program, the Direct Subsidized Loans you received for the earlier program will generally count toward your new maximum eligibility period.

Certain types of enrollment may cause you to become responsible for the interest that accrues on your Direct Subsidized Loans when the U.S. Department of Education usually would have paid the interest. These enrollment patterns are described below.

I become responsible for paying the interest that accrues on my Direct Subsidized Loans, when:

  • I am no longer eligible for Direct Subsidized Loans and I stay enrolled in my current program.
  • I am no longer eligible for Direct Subsidized Loans, did not graduate from my prior program, and am enrolled in an undergraduate program that is the same length or shorter than my prior program.
  • I transferred into the shorter program and lost eligibility for Direct Subsidized Loans because I have received Direct Subsidized Loans for a period that equals or exceeds my new, lower maximum eligibility period, which is based on the length of the new program.

Federal Direct Unsubsidized Loans

  • Direct Unsubsidized Loans are available to undergraduate students; there is no requirement to demonstrate financial need.
  • Your school determines the amount you can borrow based on your cost of attendance and other financial aid you receive.
  • You are responsible for paying the interest on a Direct Unsubsidized Loan during all periods. 
  • If you choose not to pay the interest while you are in school and during grace periods and deferment or forbearance periods, your interest will accrue (accumulate) and be capitalized (that is, your interest will be added to the principal amount of your loan).

Steps to Apply for a Federal Student Loan at Valencia

  1. 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 006750. To be eligible, you must be enrolled for at least six credit hours which count toward your current degree and be maintaining Valencia’s Standards of Satisfactory Academic Progress. If you are eligible for a Federal Direct Stafford (Subsidized or Unsubsidized) Loan, it will be included on your financial aid offer notification.

  2. Accept, Reduce or Decline a Federal Direct Stafford Loan

    You will have the option to Accept, Decline or Reduce your Federal Direct Stafford Loan on your offer notification you receive through ATLAS email.

  3. E-sign Your Federal Direct Stafford Loan Master Promissory Note (MPN)

    If you are a first time borrower of the Federal Direct Loan, you will be required to complete a Master Promissory Note (MPN) before the loan funds will be disbursed. In most cases, you will only be required to complete one MPN during your college career at Valencia, provided you are borrowing a Direct Loan. You complete your Federal Direct Stafford Loan MPN by signing into the StudentAid.gov website with you Federal PIN. You can also complete your Loan Entrance Counseling while you are on the site.

  4. Loan Entrance Counseling

    Before the Office of Student Aid can disburse your loan funds you are required to complete Loan Entrance Counseling by signing into the StudentAid.gov website with your Federal PIN. This counseling session provides you with 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 only be required to complete Loan Entrance Counseling once during your college career at Valencia.

  5. Receiving Federal Direct Stafford Loan Funds

    It is important to know that loan funds will automatically credit to your student account to pay the current term balance first before issuing a refund, if the Direct Loan Processor has a valid MPN on file for you and you have completed Loan Entrance Counseling, on the disbursement date noted on your Atlas Account

    • Federal Direct Loans will be disbursed once a student has started attendance in at least one compliant course and have met the no show reporting period for that term and are enrolled in a total of at least six compliant credit hours  towards an eligible degree program.
    • Students must be meeting Satisfactory Academic Progress.
    • First Year, first time undergraduate borrowers are required to wait 30 days before receiving their first loan fund disbursement.
    • If a student selects a one term loan, the loan will be split into two disbursements.
    • If a student selects a two term loan, the loan will be split equally between the two terms.
  6. Loan Exit Counseling

    Student borrowers are required to complete an Exit Counseling session when they drop below 1/2 time or cease to enroll at the college. You can complete your Exit Counseling at StudentAid.gov.

Federal Parent PLUS Loans

  • Direct PLUS Loans are federal loans that parents of dependent undergraduate students can use to help pay for college. Student need to have a FAFSA application on file. You must not have an adverse credit history. A credit check will be conducted. If you have an adverse credit history, you may still be able to receive a PLUS loan if you meet additional requirements.

  • The maximum PLUS loan amount you can receive is the cost of attendance (determined by the school) minus any other financial aid received.

  • If denied, student may qualify for additional unsubsidized loan upon request.

Steps to Apply for a Direct Federal Parent (PLUS) Loan

(The parent must apply for a PLUS Loan)

Interest Rate and Fee Information for the PLUS: The interest rate is fixed at 7.08% with a 4.236% origination fee.

For more information on interest rates go to the Federal Student Aid site.

           1. Direct Parent Loans for Undergraduate Students (PLUS)

              Visit Federal Student Aid for Information on a PLUS Loan.

           2. Complete FAFSA and Financial Aid File

              Your son or daughter must have a completed FAFSA at Valencia College using our School Code of 006750 with a completed                                financial aid file.

           3. You must complete a Parent Loan (PLUS) Certification Request for the correct year

              This Parent Loan (PLUS) Certification Request will ask for the requested amount and allow you to certify who to send any excess                          refunds to (the student or parent). If requested amount sent to parent, refund will be sent as paper check via mail.

          4. E-sign your Federal Direct Master Promissory Note (MPN)

             You are required to complete a PLUS MPN before loan funds can be disbursed. By signing the MPN you authorize the Department of                 Education to perform a credit check to determine your eligibility for the PLUS loan. You can complete the MPN by signing into the                    StudentAid.gov website with your Federal FSA ID.

           5. Receiving Federal Direct Parent Loan funds

              It is important to know PLUS loan funds will be applied to the students account if the Direct Loan Processor has a valid MPN on file                    and your son or daughter has begun attendance in at least six compliant credit hours. If selecting a one term loan, the loan will be                      split into two disbursements. If selecting a two term loan, the loan will be split equally between the two terms. (e.g. 1/2 the loan in the                Fall and 1/2 in the Spring). 

 

Private Education Loan

Students are encourage to see if they are eligible for Federal Aid but it is not required to complete the FAFSA application to receive a Private Loan. This will provide us with information to review your file for State, Federal, and Institutional funds before you borrow a Private Loan. 

1. Apply

Choose a lender or Bank to apply for a Private Education Loan. Valencia does not offer a preferred lender list for private loans. Students can check with their bank or research private loans on the Web. We strongly encourage students to borrow federal loans first as they offer better benefits and interest rates.

         *Some lenders may require students to meet Satisfactory Academic Progress. Be sure to review the lenders requirements before                          applying. At the time of certification by the institution, failure to meet lender requirements will cause request to be rejected.

          *Private loans are offered for degree/non-degree seeking students with branch code 006750-00 and continuing education students                   with branch code 006750-98.

2. School Certification

Our office will certify the loan once we receive a certification request from your lending institution and you are enrolled in classes for the requested payment period.

Private loan limits are set by federal regulations and cannot exceed the cost of attendance minus any financial aid received. 

To determine the certification amount:

A.     Student’s cost of attendance for the period of enrollment covered by the loan $____________________

B.      Estimated financial assistance for the period of enrollment covered by the loan $____________________

C.      Difference between amounts A and B

WARNING: If you borrow more than the amount on line C, you risk reducing your eligibility for free or lower-cost federal, state, or school financial aid.

3. Receiving Private Student Loan

  • Processing time of certification may take up to 7 business days from the time of enrollment. We do not certify alternative loans until the student is enrolled in the first term of the aid period indicated on the application. This prevents receiving funds for students who do not enroll.
  • Processing time between the lender and the institution takes up to 9 business days.
  • Upon receipt of Private funds, the remaining amount minus tuition and fees will be disbursed to the student’s refund preference on file. Note: Private funds pay directly to the student’s account and cannot be authorized for bookstore purchases.
  • Once funds are received by the school, if the student is not enrolled, the funds will be returned to the lender. Please contact the Financial Aid Office to request a re-issue from the lender.

Preparatory Coursework Loans

  • A student not enrolled in a degree or certificate program is eligible for Direct Subsidized/Unsubsidized Loans for up to one year (12-month period) if taking coursework required for admission to a specific degree program on a case by case.
  • A student may apply for a Direct Loans for coursework the school has documented is necessary to be admitted to an eligible degree program as outlined by an academic advisor. The courses must be part of an eligible program otherwise offered by the school, though the student does not have to be in that program.
  • If enrolled at least half time in these pre-requisite courses, student is eligible for loans for one consecutive 12-month period (not per program)   beginning on the first day of the loan period. If the period of preparatory courses spans more than one academic year, the student may receive multiple loans.
  • To be eligible for loans under this exception, the student must be taking classes that are a prerequisite for admission. If only taking them to raise GPA in order to be admitted, student would not qualify.
  • Students will be monitored throughout the enrollment period to ensure they remain eligible.

 

 Federal Preparatory Coursework Loan Limits:

Undergraduate program

Dependent: $2625 all subsidized or combined unsubsidized loan

Independent: $2625 combined subsidized/unsubsidized base loan plus additional unsubsidized up to $6000

Graduate/Professional program

Dependent: $5500 all subsidized or combined unsubsidized loan

Independent: $5500 combined subsidized/unsubsidized base loan plus additional unsubsidized up to $7000


Note: Loan Amounts subject to Aggregate loan limits.

Steps to Apply for a Federal Preparatory Coursework Loan

  • Meet with academic advisor to discuss and if student qualifies review the Financial Aid Preparatory Coursework SAP Appeal Form
  • Complete appeal process with explanation
  • Appeals are reviewed by committee with a processing time of two to four weeks for an eligible award offer

 

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