Although it is sometimes necessary to borrow money to finance education, caution is advised. Generally, a student should not rely primarily on loans and is advised not to borrow more than what is needed to meet expenses.
Apply at fafsa.gov
Federal Loan Information
Federal Direct loans are low-interest loans for students and parents to help pay for the cost of a student's education after high school. The lender is the U.S. Department of Education, though most of the contact will be with your loan servicer.
Direct Loans allow you to:
- Borrow directly from the federal government and have a single contact - your loan servicer - for everything related to repayment, even if you receive Direct Loans at different schools
- Have online access to your Direct Loan account information via your school's website
- Choose from several repayment plans, and you can switch repayment plans if your needs change
Annual Maximum Loan Limits
Aggregate Maximum Loan Limits
The higher maximum loan for independent students reflects a combination of Federal Direct Subsidized and Unsubsidized Stafford Loans. The annual maximum Subsidized Loan Stafford eligibility is limited to the dependent eligibility for each class level.
Federal Direct Unsubsidized Stafford Loan
A Federal Direct Unsubsidized Stafford Loan is not based on the student's financial need, but students must also meet specific federal requirements. Interest is charged throughout the life of the loan. The borrower may choose to pay the interest charged on the loan or allow the interest to be capitalized (added to the loan principal).
- Federal Unsubsidized loans provide low interest rates and are available to all students regardless of financial need (although the FAFSA still must be filed). A credit check is not required to receive these loans
- The student is responsible for the interest, which may be paid while the student is in school, or accrued and then added to the principal balance when the student enters repayment, which occurs six months after the student is no longer enrolled in school at least half time.
Apply for a Federal Direct unsubsidized loan
To apply for a Federal Direct Unsubsidized Loan, you must complete the FAFSA. To be eligible, you must be enrolled for at least six hours per semester. If you are eligible for a Federal Direct Unsubsidized Loan, it will be included on your financial aid award.
- Accept Terms & Conditions
- Accept Loan Offer
- Complete Master Promissary Note (MPN)
- Complete Entrance Counseling
Both Entrance Counseling and the Master Promissary Note only need to be completed once and are good for ten years.
Adjust/Cancel your Loan
- Go to your Student Banner Account. Enter Secure Area using your UAH user ID and password. If you do not know your user ID and password, contact Charger Central at 1-800-UAH-CALL.
- Select financial aid/award/award for aid year/201x-201x /Accept Award Offer tab
- Click on the the Loan Adjustment option
Federal Direct Graduate PLUS
Graduate PLUS Loans are federal loans that graduate students with good credit histories may borrow to help pay educational expenses. Recipients must be enrolled in at least six credit hours per semester with the exception of three credit hours during the summer term.
With a Graduate PLUS Loan, graduate students may borrow up to the full cost of attendance less other financial aid. There is a 4.288% loan origination fee deducted from the loan by the U.S. Department of Education.
- Federal Graduate Plus Loans are low interest loans that graduate students may obtain to help pay for their own education. PLUS loans require a credit check and, in some instances, an eligible co-signer
- Repayment of PLUS loans begins following the final disbursement for the year. Graduate students may be able to defer repayment of their PLUS loans until after the student is no longer enrolled in school at least half time, although interest will continue to accrue
- Students must also complete a separate Entrance Counseling and Master Promissory Note
Our office recommends that your Federal Loans be exhausted prior to applying for a Grad Plus Loan
- Complete the online application at www.studentloans.gov OR
- Log in to banner self-service
- Enter Secure Area using your user ID (A-number) / UAH pin number
- Select financial aid/award/Grad Plus Application
- Complete Master Promissory Note for Grad Plus
- Complete Entrance Counseling for Grad Plus
Federal Direct Graduate Plus Loan Processing
The Direct Loan Processor will notify the student borrower of the results of the credit check. The borrower cannot have been 90 days or more delinquent on the repayment of any debt or the subject of a default determination, bankruptcy discharge, foreclosure, repossession, tax lien, wage garnishment or write-off of a Title IV debt during the last five years. If credit is approved, loan funds will be posted to the student's school award.
Receipt of Funds
The funds will be applied to tuition, fees, and other university charges. If the Federal Direct Graduate Plus disbursement generates a refund after University charges are paid, the excess amount will be applied to the students account and refunded via Direct Deposit though the Bursar's Office
Credit approval is valid for 90 days. Your credit is evaluated every time you request a new loan, unless you have had a credit decision within the preceding 90 days.
If you think you may have one or more of the items outlined in the credit requirements listed above, you may want to obtain your credit report in advance of applying for a Grad PLUS Loan. You should work to correct negative items on your credit report as soon as possible.
Credit denial options include:
Loans require half-time enrollment.
Exceptions apply for graduate student enrollment during the summer term when three credit hours is considered half-time enrollment.
The U.S. Department of Education contracts with multiple servicers to manage Direct Loans. These servicers are responsible for the billing, collection and processing of all deferments, forbearances and cancellations.
UAH processes and disburses loan funds to your UAH account. You can accept, reduce, cancel or adjust your loans on your Student Self-Service account.
Locate the servicer of your loan at www.nslds.ed.gov.
Complete a FAFSA each year you need aid.
Students have a one-time six month grace period and repayment begins six months after graduation or six months after the student ceases half-time enrollment.
Interest on Subsidized Loans are paid by the government while the student is in school.
Unsubsidized Loans accrue interest once it has disbursed and is paid by the borrower.
A Master Promissory Note (MPN) is a promise to repay the loan and must be completed before disbursement will occur.
Entrance Counseling is a tutorial and quiz that will explain your rights and responsibilities as a Direct Loan borrower and is required before a loan will disburse.
The MPN and Entrance Counseling are valid for ten years.
Exit Counseling is required and will explain your rights and responsibilities as a Direct Loan borrower. Direct Loan Exit Counseling is required when you drop below half-time student status or cease to be a student at UAH.
By accepting your financial awards, you are agreeing to give UAH permissions to use the funds to pay any direct institutional charges incurred incidental to your enrollment.
Outside assistance that pays tuition must be reported on the Outside Resource Form or your aid maybe reduced or cancelled.
The Federal Student Aid Ombudsman Group of the U.S. Department of Education is dedicated to helping resolve disputes related to Direct Loans, Federal Family Education Loan (FFEL) Program loans, Guaranteed Student Loans, and Perkins Loans. The Ombudsman Group is a neutral, informal, and confidential resource to help resolve disputes about your federal student loans.
Use the following list of common problems to help you identify exactly what type of problem you are having with your loan and what you should do to prepare to solve it.
IF: You believe you've made all of your payments on time, but it looks like your account balance might be wrong.
THEN: Check your payment history, gather the documents necessary to show what payments you've made, and contact your loan servicer to find out how to submit the proof.
IF: You believe you've made all of your payments on time, but your loan is in default.
THEN: Gather the documents necessary to prove that your payments were made on time, and contact your loan servicer to find out how to submit your proof.
IF: You believe your loan servicer has reported inaccurate information to the credit bureaus.
THEN: File a consumer dispute with the bureaus. Contact the three national credit bureaus in writing to tell them what information you believe is inaccurate:
IF: You completed bankruptcy but are still getting loan repayment bills.
THEN: It is unlikely that you are eligible to have your loan discharged through bankruptcy. If you filed for bankruptcy after October 7, 1998, your loan cannot automatically be discharged.
IF: You are not the person listed in the loan records.
THEN: You will need to provide proof of your identity. Contact your loan servicer to find out what documents are needed and how you should present them.
IF: You have to withdraw from all your classes in the midst of a term.
THEN: You would be required to repay a portion of any federal aid they receive during the term. A percentage of the completed semester is calculated and the percentage of aid earned is determined; please see the section on policy for more information.
IF: You only have to withdraw (drop) one class?
THEN: You would not owe funds back immediately; however, it could affect your Satisfactory Academic Progress and potentially your eligibility for future aid. See the section on Satisfactory Academic Progress.
Contact Your Loan Servicer
You've identified your problem and are ready to contact your loan servicer. To deal effectively with your loan servicer, keep in mind the tips below. Locate the servicer of your loan at http://www.nslds.ed.gov
Keep careful notes of all conversations you have. Follow up in writing so you have a physical record of what has been said and done.
- Request a copy of your customer service history; some loan servicers make available copies of the notes that customer service representatives make on your account.
- When you speak with someone on the phone, make a note of whom you speak to and when, and what was said. When you use mail, keep a copy of your letter and of any replies you receive.
- Save the originals of all receipts, bills, letters, and e-mails regarding your account. Provide copies of the originals if you are asked for them. Send letters via certified mail, with a return receipt requested.
- Don't let the emotion of the moment get to you. If you are not getting a proper response to your questions, calmly explain again what information or resolution you are seeking.
- Be polite and courteous, but don't be afraid to give the detail of any incident and to state your concerns. Write down the facts in the order they took place and stick to what is relevant. Include important details such as your account number at the top of your letter.
- Ask for a response in a reasonable time, and be sure to tell the customer service representative how you can be reached.
Problem not solved? If you are still not satisfied, you might wish to contact the Federal Student Aid Ombudsman Group to help you resolve your dispute. Contact the Ombudsman Group only as a last resort; and first, be sure to be prepared before seeking help.
- Telephone: 877-557-2575
- Fax: 202-275-0549
U.S. Department of Education
FSA Ombudsman Group
830 First Street, N. E., Mail Stop 5144
Washington, D.C. 20202-5144
Origination Fee Change
As of October 1, 2013, the sequester increases the origination fees charged to Direct Loan borrowers beyond last year's increases. However, taking into account all of the underlying circumstances, including operational requirements, the new loan fee percentages will apply only with regard to loans where the first disbursement is made on or after December 1, 2013.
The new loan fees are 1.072 percent for Direct Subsidized Loans and Direct Unsubsidized Loans and 4.288 percent for Direct PLUS Loans (both parent and graduate student PLUS Loans).
Time Limitation on Subsidized Loans
Please note: For all new borrowers who receive a loan on or after July 1, 2013 a 150% limitation is in effect. This means a student who is eligible for a subsidized loan will reach their subsidized limit at 150% of a program's length of study. Once a student has reached their 150% limitation, their interest subsidy loan limit will end on all outstanding loans that were disbursed after July 1, 2013, and interest will begin to accrue. Students are therefore encouraged to complete undergraduate study on a timely basis.
Need additional funds beyond scholarships and federal aid?
Private student loans are a means of financing educational expenses not covered by other sources of financial aid.
Be sure that you have applied for federal loans via the FAFSA before considering private loans. Federal Unsubsidized Loans are not based on financial need, so definitely explore this option before applying for private loans.
- UAH does not maintain a preferred lender list. Since private loan lenders are profit-oriented, our office cannot recommend one lender over another.
- One way to identify lenders is to search the internet. Most lenders provide information concerning their student loan programs online and also provide an online application process.
- Loan terms, fees, interest rates, and eligibility criteria vary widely between lenders. Compare rates and terms before choosing a lender. Read the fine print to insure you are making an educated choice.
- The application process for a private student loan is between you and the lender: UAH is not involved in the initial application process.
- As part of the application process, the lender will do a credit check. If you have not built a credit history, or if your credit rating is low, the lender will require you to have a credit-worthy co-signer. Adding a credit worthy cosigner will help increase the chances for approval, and could lower the interest rate on the loan.
- Most lenders provide an online application process. However, some lenders may require additional documentation (such as a Self-Certification form) and signatures. Be sure to react promptly to any requests for information or signatures from your lender in order to keep the application process moving.
Private loan applications include a question about the estimated Cost of Attendance (COA). Below is a chart containing the UAH COA figures for 2013-2014.
2014-2015 UAH Cost of Attendance
includes estimated living expenses
|Undergraduate (in-state tuition)
|Undergraduate (out-of-state tuition)
|Graduate (in-state tuition)
|Graduate (out-of-state tuition)
Your maximum eligible loan amount is determined by subtracting the total of your financial aid and scholarships for the loan period from the estimated UAH Cost of Attendance for the loan period.
Borrow only what you need! This is a loan that must be repaid with interest.
The loan period you select on the application is very important. It indicates which COA figure from the chart above will be used to determine eligible loan amounts.
The loan period will also determine the number of disbursements (payments) for the loan. For example, if the specified loan period is 8/01/2013 thru 5/1/2014, then a two semester COA will be assumed and the loan amount will be disbursed in two payments (one per semester).
The loan period must fall within a single academic year. The academic year at UAH begins with the Fall semester and ends with the Summer semester.
After a student has been pre-approved for a private loan, the lender will send a certification request to UAH for processing. As part of the certification process, our office will provide the following information:verification that the student is registered for classes at UAH during the specified loan period
- the number of credit hours in which the student is enrolled
- the amount of financial aid/scholarships the student is receiving
- approved loan amount
- disbursement dates
Please note: our office will not certify private loans for an amount that exceeds the cost of attendance minus other financial aid or that require funding or financial guarantees by the university. If the requested loan amount exceeds eligibility limits, the loan amount will be reduced to the maximum eligible amount on the loan certification.
Disbursement dates indicate when the lender will send the funds to UAH. Our office will provide the following disbursement dates to all lenders as part of the certification process for academic year 2013-2014:
- Fall 2013 Semester: August 16, 2013
- Spring 2014 Semester: January 1, 2014
- Summer 2014 Semester: May 16, 2014
If an applicable disbursement date has already passed by the time the loan is certified, then the lender will schedule the first possible disbursement date, taking into consideration a mandatory 3 day right-to-cancel period as well as their processing schedules. If you have completed the final sign-off of the terms of your loan, you can contact your lender to find out the scheduled disbursement dates for your loan funds.
When your loan funds are received by UAH, the funds will first be applied to any outstanding charges on your UAH bill. Any remaining funds will be refunded to you by paper check, by direct deposit, or by a credit back to your credit card if a credit card was used to make a payment for that semester. Students are strongly encouraged to sign up for direct deposit when expecting a refund.