Graduate Student Loans
If you're like most students, you will probably need some type of student loan to help finance your college education. You should think of a student loan as an investment in your future - as long as you are prepared to meet your repayment responsibilities. All loans, including student loans, represent debts that must be repaid. The good news is that you do not have to start repaying most student loans until after you leave school or graduate.
In addition to delayed repayment, most student loans have relatively low interest rates, several repayment options from which to choose, circumstances under which repayment can be postponed, and other favorable terms and conditions. At Cal U, the federal government funds nearly 95% of all loans. Mandatory online loan counseling helps students understand the responsibilities that come with borrowing money for education. Stafford loan entrance counseling must be completed before loans can be disbursed. After a student graduates or drops below half time, exit counseling must be completed in order ensure compliance with federal regulations. Failure to repay your student loans will have serious adverse consequences.
California University adheres to a strict code of conduct regarding student borrowing. In the best interests of our students, we encourage you to borrow wisely. Creating a budget is one of the most important aspects of student loan borrowing. When borrowing, it is important to carefully plan your budget so that you only borrow what you need, keep track of the total amount borrowed each year and have some idea as to how you will pay your loans back when the time comes. The Loan Estimator and Repayment Calculator are two electronic tools that can help you with this task. In addition, the Career Services Office can provide you with information concerning salaries in most fields.
Important changes regarding Federal Direct Stafford loans
Beginning with the 2012-2013 academic year, the US Department of Education has made some important changes regarding Federal Direct Stafford Loans for both undergraduate and graduate students.
- The interest rate for Federal Direct Subsidized Loans will change from 3.4 percent to 6.8 percent beginning July 1, 2012. Unsubsidized Stafford loans will remain at a fixed 6.8 percent rate.
- Interest subsidy during the six-month grace period is eliminated for new Stafford Loans made on or after July 1, 2012. The repayment period still begins 6 months after the student is no longer enrolled at least half-time, but interest that accrues during those six months will be payable by the student rather than be subsidized by the federal government.
Find out more about the most common loans for graduate students.
Federal Stafford Loan Program
The Federal Stafford Loan is a low-interest education loan designed for both undergraduate and graduate students. Because this is a government loan, the money you borrow is guaranteed by the federal government. Stafford Loans are an extremely popular and cost-effective way to finance your education. More than 50% of all financial aid awarded at California University comes from the Federal Stafford Loan Programs.
There are two types of Stafford Loans: subsidized and unsubsidized. Depending on your household income, you may be eligible for one or both loans. The type of Federal Stafford Loan that you receive is determined by your FAFSA [http://www.fafsa.ed.gov] results.
- A Subsidized Federal Stafford Loan is awarded on the basis of financial need. The government pays the interest while you are in school, during any deferment, and during the grace period before repayment begins.
- An Unsubsidized Federal Stafford Loan is available to all students regardless of income. As the borrower, you are responsible for all interest that accrues while you are in school, while the loan is in deferment and during the grace period.
- Undergraduate dependent students may borrow a total of $31,000 in Federal Stafford Loans (no more than $23,000 of which can be subsidized).
- Undergraduate independent students may borrow a total of $57,500 (no more than $23,000 of which can be subsidized).
- Graduate students may borrow a total of $138,500 (no more than $65,500 of which can be subsidized)
- There is a limit to the amount you can borrow with a Federal Stafford Loan during any given year. Graduate students with subsidized or unsubsidized Stafford Loans may borrow up to $20,500 per year, with no more than $8,500 in subsidized loans.
Interest Rates and Fees for Federal Stafford Loans
The U.S. Department of Education charges an origination fee of 1% and the loan guarantor charges a federal default fee of 1%. The default fee will be waived if the participating guarantee agency selected by the borrower will pay the fee.
The rate for subsidized Stafford Loans for graduate and professional students is 5.6%, and all unsubsidized Stafford Loans is 6.8%.
Aggregate Loan Limits
There are limits to the amount of Federal Stafford Loans that a student can borrow for college.
Repayment Policy for Federal Stafford Loan
Once you graduate, withdraw or leave school, you will be granted a six-month grace period. During your grace period, your lender will provide you with a repayment disclosure statement containing your repayment terms, including the amount of your monthly payment and the due date of your first payment. Repayment of the Federal Stafford Loan begins at the end of this six-month grace period and usually extends up to 10 years. Generally, the minimum monthly payment is $50; however, you should talk to your lender to determine other flexible repayment terms that might be available.
Learn more about the application process for Federal Stafford Loans.
Grad PLUS Loans
The Federal PLUS Loan is a credit-worthy loan for a graduate student who has borrowed the maximum amount of Stafford Loan assistance. Parents of dependent students can also apply for PLUS loans, up to the cost of education, less all other financial aid received. Repayment normally begins within 60 days after the first disbursement of the loan. The lender you choose will review credit reports and determine whether or not they will fund this loan.
Follow these steps in the Federal PLUS Loan Master Promissory Note (MPN) processing cycle:
Complete the entire pre-approval (credit check) and application process on-line at www.aessuccess.org. Just click on the "PLUS Loans" link under the "Find Aid for School" menu tab and then click "Apply Now." By using the online PLUS MPN process at AES/PHEAA, borrowers receive an immediate response. If approved, a borrower can complete an electronic version of the PLUS application by following the instructions online, or can print a paper copy and mail it to AES/PHEAA.
When selecting a PLUS Loan lender, our office strongly recommends that you choose a lender from one of our preferred Federal PLUS Loan lenders, which also appears in the drop-down box at the AES/PHEAA website when you complete your MPN electronically.
The Grad PLUS Loan differs from the PLUS Loan for Parents in one way. If your Grad PLUS loan application is denied, you will not be eligible to borrow additional loan funds through the Federal Unsubsidized Stafford Loan program as you would be if your parents had applied for, then been denied, a PLUS Loan for Parents.
If you are ineligible because of an adverse credit history, they may obtain an "endorser" for the loan. The endorser must be a credit-worthy U.S. citizen or eligible non-citizen. Basically, the endorser on a Federal PLUS Loan will be acting as a co-applicant for the parent or graduate student on the loan. Therefore, the endorser must meet the same credit criteria as the parent-borrower. In most cases, the ability to pass this credit criteria is less stringent than qualifying for a private loan.
California University will electronically certify your PLUS MPN and determine the amount of your eligibility once we are notified by AES/ PHEAA (AES/PHEAA-approved lenders only).
The lender will electronically transmit the Federal PLUS Loan funds to California University.
Note: In order to allow your student to receive the refund of excess PLUS Loan funds, you must complete and return the Federal PLUS Loan Release Authorization Form to the University Bursar's Office.
Private Alternative Loans
In addition to the federal student loan programs, there are private, non-need-based loans that you and your parents can use to help pay for educational expenses. Since these loans are not subsidized by the federal government, they usually have a higher interest rate to the borrower and should only be considered as a last resort after all other financial aid options have been explored.
Most private loans require a co-signer; however, repayment of principal and interest may be deferred in most cases. Having a credit-worthy co-signer will also likely reduce the cost of the loan (interest rate, up-front and back-end fees, etc.) Be aware that the co-signer is fully responsible for repaying the loan should the borrower stop making payments. There are some alternative loan products that offer a co-signer release option after a specified number of on-time payments are made and the borrower is credit-worthy.
As part of the application process, students will be required to complete the Private Education Loan Applicant Self-Certification Form available through their lender's website. Students may also obtain a Self-Certification Form from the Office of Financial Aid. Information needed to complete this form, such as cost of attendance, may be obtained from the link below while estimated financial assistance may be obtained from the student's Award Letter or via the Vulcan Information Portal.
The lenders listed below have made loans to California University of PA students in the past and offer:
- Competitive interest rates
- Zero fees and/or borrow discounts during repayment
- Electronic application processing and fund delivery
- Loan servicing until paid in full
- Excellent customer service
- Long-term commitment to educational financing
We have developed a list of participating Alternative/Private Education loan lenders for students who would like guidance in selecting loans. Our selections were made in the best interest of the students of California University of PA in accordance with federal regulations and institutional policies. The suggested lenders uphold the utmost integrity and responsibility, as well as excellent customer service practices. Our ultimate goal is to promote and encourage responsible borrowing and repayment options that best suit the California University of PA students.
We encourage you to compare borrower benefits offered by any participating lender before deciding which lender to use. While we suggest the lenders below, you may choose any participating lender for the Private/Alternative Education loans. Because there are numerous private loans available to students today, finding the right loan that best meets your financing goals can be challenging. To assist you in this process, Cal U has partnered with Simple Tuition. Simple Tuition provides an interactive loan comparison tool to assist students and families in evaluating and selecting the best private loan options for their specific circumstances.
The lenders are listed alphabetically by lender name, so no inference should be made based upon the order of the listing. Borrowers are encouraged to review the terms and conditions of each program prior to selecting a lender. The criteria listed above will be reviewed periodically to determine if loan programs may be added to, or removed from, the list of programs. You are not required to borrow from one of the loan programs listed below.
Interest Rate Disclosure Information
Interest Rate Disclosure Information
California University of PA adheres to the Financial Aid Code of Conduct based on the Higher Education Opportunity Act of 2008.