Federal Direct Loan 2013-14

Federal Direct Loans are available to students enrolled at least half-time.  The federal government offers loans with an interest subsidy (subsidized), and without a subsidy (unsubsidized).  If you're eligible for a Federal Direct Subsidized Loan, the government will pay the interest on the loan until you graduate, withdraw from college, or enroll less than half-time, at which time interest will be charged, but repayment of principal and interest will begin after a six month grace period.  This rule went into effect on loans disbursed after July 1, 2012. Federal Direct Subsidized Loans disbursed before July 1, 2012 will continue to have the interest subsidy during the six month grace period. If eligible for a Federal Direct Unsubsidized Loan, you will remain responsible for the interest charge upon receipt of the loan, but may defer payment of that interest until you leave school. Interest that has accrued on the Federal Direct Unsubsidized Loan will be capitalized upon repayment.  The interest rate for loans disbursed between July 1, 2013 and June 30, 2014 will be a fixed rate of 3.4% for Federal Direct Subsidized Loan and 6.8% fixed for Federal Direct Unsubsidized Loan. For students enrolled in the Graduate Program, the interest rate is 6.8%.  These rates are subject to change.

Repayment Charts

To understand your repayment responsibilities before you borrow, go to:  Student Loan Repayment Interest Rate Tables or Repayment Chart for Federal Loans and Private Loans.

For more customized estimates of your federal loan repayment, use the online repayment calculator at:  www.direct.ed.gov

Grace Period Interest Subsidy

A law was put into effect to temporarily eliminate the interest subsidy provided on Federal Direct Subsidized Loans during the six month grace period provided to students when they are no longer enrolled on at least a half-time basis.  This change went into effect for new Federal Direct Loans for which the first disbursement is made on or after July 1, 2012, and before July 1, 2014.

Loss of Subsidized Loan Eligibility for Graduate and Professional Students - The Budget Control Act eliminated the availability of Federal Direct Subsidized Loans to graduate and professional students effective for loans made for periods of enrollment (loan periods) on or after July 1, 2012 and the availability of certain repayment incentives for loans made on or after July 1, 2012.  The annual loan limit for graduate and professional students remains unchanged at $20,500, but this amount will now be limited to Federal Direct Unsubsidized Loans.

Borrowers are normally allowed 10 years to repay the loan, making the investment affordable for most students.

The Definition of Half-Time Enrollment Status at BVU

Students must be enrolled at least half-time to receive the Federal Direct Loan. See the following for each programs definition of half-time status:

1. Storm Lake Campus Undergraduate Program

• 6 hours in a semester = 1/2 time status

2. Storm Lake Graduate Program

• 3 hours in a semester = 1/2 time status

3. Graduate and Professional Studies Program

• Undergraduate Program 
• Fall Semester- Combine Terms 1 & 2 (6 hours = 1/2 time status)
• Spring Semester - Combine Terms 3 & 4 (6 hours = 1/2 time status)
• Summer Semester - Combine Terms 5 & 6 (6 hours = 1/2 time status)

• Graduate Online Program
• Fall Semester - Combine Terms 1 & 2 (3 hours = 1/2 time status)
• Spring Semester - Combine Terms 3 & 4 (3 hours = 1/2 time status)
• Summer Semester - Combine Terms 5 & 6 (3 hours = 1/2 time status)

4. Ottumwa Coop Program

• 4 hours = 1/2 time status

Federal Direct Loan Program

Federal student loans, from William D. Ford Federal Direct Loan (Direct Loan) Program, are low-interest loans for eligible students to help cover the cost of higher education.  Eligible students borrow directly from the U.S Department of Education.

Returners

Buena Vista Students that have borrowed through the Federal Direct Loan Program previously and signed a Master Promissory Note (MPN) with Direct Loan will not be required to sign a new MPN.  If you did not borrow the Federal Direct Loan previously and now wish to borrow, go to Studentloans.gov to complete the Federal Direct Loan MPN and entry counseling.

When completing your MPN and entry counseling, you will be asked for your federal PIN number.  This is the same number you used to electronically sign your FAFSA.  If you need to request a PIN, visit the federal PIN website at www.pin.ed.gov.

Prior Federal Loans and Financial Aid History - Federal loans will be submitted to the National Student Loan Data System (NSLDS), and will be accessible by guaranty agencies, lenders, and schools determined to be authorized users of the NSLDS system. 

If you currently have a federal student loan and would like to check the interest rate, servicer information, and other financial aid history, go to the National Student Loan Data System (NSLDS) at www.nslds.ed.gov. and use your federal PIN (FAFSA pin) to access your information.

Steps To Complete The Process For First Time Borrowers

Entrance Counseling

All first-time borrowers are required to receive entrance counseling before loan funds will be disbursed.  This counseling will provide you with your rights and responsibilities as a student loan borrower.  To complete this requirement online, please visit StudentLoans.gov being sure to request that confirmation be sent to BVU. 

Master Promissory Note

As a first-time borrower you will also be required to complete a Federal Direct Loan Master Promissory Note (MPN).  The MPN will be used for all Federal Direct Subsidized and/or Unsubsidized Loans that you borrow.  You will only need to complete one MPN while enrolled at Buena Vista University.

You will be asked for your federal PIN number when completing the MPN.  This is the same number you used to electronically sign your FAFSA.  If you need to request a PIN or have forgotten yours, visit the federal PIN website at www.pin.ed.gov.

Federal Direct Loan Master Promissory Notes (MPN) remain valid and on file with the guarantee agency for up to 10 years after the date you executed the note.

To complete the electronic MPN, go to StudentLoans.gov.

A Federal Direct Loan will not be processed until the Master Promissory Note and entry loan counseling have been completed.

Transfer Students

If you have previously borrowed a Federal Direct Loan and completed a MPN at another institution, you do not need to complete a new MPN. Simply notify the Office of Financial Assistance.

Federal Direct Loan Interest Rates (These rates are subject to change.)

• Undergrad Program

Federal Direct Subsidized:  fixed @ 3.4%

Federal Direct Unsubsidized Loan: fixed @ 6.8%

• Graduate Program

Federal Direct Unsubsidized Loan rate:  fixed @ 6.8%

Federal Direct Loan Benefits

• Fees

There is a 1.051% origination fee. Visit the Direct Loan Servicing website for more information.

• Rate Reduction for Auto Payment

Electronic Debit Account (EDA):  If you repay your loans through the EDA repayment option, you will receive a quarter point (.25%) discount on your interest while in repayment.

If you need assistance, contact the Office of Financial Assistance at 712.749.2164 or email finaid@bvu.edu.