Undergraduate Loan Information

Part of a student‘s financial aid package from Heidelberg includes the Federal Direct Loan Program with payment beginning after the student graduates or falls below half-time status. The Direct PLUS Loan allows parents with no adverse credit to borrow up to the difference of our total costs minus the student's financial aid.

Federal Direct Loan Program

Direct loans are guaranteed, low interest loans for students. The lender is the Department of Education.

There are two types of Direct Loans: subsidized and unsubsidized. A Direct subsidized loan is need-based. No interest is charged while the student is enrolled at least half-time. A Direct unsubsidized loan is not based on financial need and interest is charged during the enrollment period. The interest rate is determined each July 1st. The rate for 2020-21 is 2.75%.

Need based on FAFSA analysis. Must be at least half-time. Up to $5,500 for first-year students, with no more than $3,500 being subsidized, $6,500 for second-year students, with no more than $4,500 being subsidized, and $7,500 for third and fourth-year students, with no more than $5,500 being subsidized. The interest on a Direct Subsidized Loan will be paid by the federal government while the student is enrolled at least half-time. In the Direct Unsubsidized Loan program, financial need is not required. Interest is paid by the student while attending school or can be deferred.

Undergraduate Annual Loan Limits for Direct Subsidized and Unsubsidized Loans:

  Dependent Independent
First Year (freshman) $5,500 (maximum $3,500 subsidized) $9,500 (maximum $3,500 subsidized)
Second Year (sophomore) $6,500 (maximum $4,500 subsidized) $10,500 (maximum $4,500 subsidized)
Third Year (junior and beyond) $7,500 (maximum $5,500 subsidized) $12,500 (maximum $5,500 subsidized)

Aggregate Loan Limits:

  Dependent Independent
Undergraduate $31,000 (maximum $23,000 subsidized) $57,500 (maximum $23,000 subsidized)

You can complete the Direct Loan paperwork here:

Federal Direct Loan Entrance Counseling and Master Promissory Note

Federal Direct Loan Exit Counseling

Benefits that are part of the federal student loan program include:

  • Congressionally mandated deferment and forbearance periods for qualifying borrowers.

  • Multiple repayment plan options to help make repayment more affordable.

  • Loan forgiveness for qualifying borrowers.

  • Loan discharge due to death or permanent disability. This means if something happens to you along these lines the debt is forgiven and no one is responsible for it.

  • Fixed interest rate that will not increase if rates in the general economy increase in the future.

  • Tax deductions for loan interest paid to qualifying borrowers.

Direct PLUS Loan for Parents

The Direct PLUS Loan for Parents is a loan option available to parents. Parents can borrow up to the difference in the student's cost of attendance less any financial aid. The interest rate for 20-21 is 5.3%. Interest begins with loan disbursement and repayment begins 60 days after the loan is fully disbursed with a 10-25 year repayment period. A payment delay may be requested while the student is enrolled at least half-time.

Eligibility Requirements:

  • Must be biological or adoptive parent

  • Student must be a dependent enrolled at least half-time

  • Must be US Citizens or eligible noncitizen

  • Endorser (co-signer) may be added or may be reconsidered if adverse credit history is indicated

  • PLUS loan counseling required for adverse credit history

The determination of Adverse Credit History has changed. A credit check will be performed during the application process. If you are determined to have an adverse credit history, you may still receive a Direct PLUS Loan by obtaining an endorser who does not have an adverse credit history or by documenting to the U.S. Department of Education's satisfaction extenuating circumstances relating to your adverse credit history. You will be required to complete PLUS Loan Counseling also.

Begin to apply for a Direct PLUS Loan, Direct PLUS Master Promissory Note

For more information about the Federal Direct Loan Programs, visit www.studentaid.gov

Private Student or Parent Alternative Loans

Education Loans help bridge the gap between the actual cost of education and the limited amount the government allows you to borrow in its programs. Private loans are offered by private lenders and there are no federal forms to complete. Eligibility for private student loans often depends on your credit score.

Students are encouraged to apply for a private loan with a cosigner even if you could qualify for a loan on your own. Just applying with a cosigner usually results in a slightly lower rate, as such loans are not as risky for the lender. Moreover, the interest rates and fees are usually based on the higher of the two credit scores. So if your cosigner has a much better credit score than you, it could result in a much lower interest rate.

Please know that you have the right to borrow through the lender of your choice and you are not limited to those included through the Private Education Loan Selection Tools.

IMPORTANT NOTE: It may take 4 to 6 weeks for you to receive funds from a private education loan, once you have filed an application for the loan.

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