Loans

Although it is sometimes necessary to borrow money to finance education, caution is advised. Generally, a student should not rely primarily on loans and advised not to borrow more than what is needed to meet expenses.

Loan Types

Federal Direct Subsidized Stafford

Federal Direct Unsubsidized Stafford

Federal Direct Parent PLUS

Federal Direct Grad PLUS

Loan FAQs

Understanding Loan Limits

News and Updates

Federal Loan Information

You must be enrolled half-time to receive a loan.

If you withdraw from all your classes during a term, you may owe part or all of your funds back to the federal programs.

You must report outside assistance that pays your tuition using the Outside Resource Form or your aid may be reduced.

You understand that, by accepting your financial aid award, you give UAHuntsville permission to use these funds to pay any and all direct institutional charges incurred incidental to your enrollment.

Repayment begins six months after graduation or when the student drops below half-time attendance.

The interest on the subsidized loans is paid by the federal government while the student is in school.

The interest on the unsubsidized loans will start accruing immediately when the loan is disbursed.

The amount a student may borrow is limited to financial eligibility. Stafford loans will be subject to a 1% origination fee.

Interest rates are variable up to 8.25% maximum. Current interest rates on subsidized loans are 3.4% and 6.8% on unsubsidized loans.

Total indebtedness cannot exceed $31,000 for a dependent undergraduate, $57,500 for an independent, or $138,500 as a graduate or professional student

Satisfactory Academic Progress - Students must maintain satisfactory academic progress to receive federal aid.

Annual Maximum Loan Limits
	Dependent Student	Independent Student
Freshman: 0 - 32 credit hours	$5,500 (no more than $3,500 subsidized)	$9,500 (no more than $3,500 subsidized)
Sophomore: 33 - 63 credit hours	$6,500 (no more than $4,500 subsidized)	$10,500 (no more than $4,500 subsidized)
Junior/Senior: 64+ credit hours	$7,500 (no more than $5,500 subsidized)	$12,500 (no more than $5,500 subsidized)
Graduate Professional	N/A	$20,500

 

Aggregate Maximum Loan Limits
Status	Amount
Dependent Student	$31,000 (no more than $23,000 subsidized)
Independent Student	$57,500 (no more than $23,000 subsidized)
Graduate Professional	$138,500

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.

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Federal Direct Subsidized Stafford Loan

A Federal Direct Subsidized Stafford Loan is awarded on the basis of the student's financial need and other specific federal requirements. The federal government does not charge interest on these loans while borrowers are enrolled at least half-time.

• A federal student loan allows students and their parents to borrow money to help pay for college through loan programs supported by the federal government. These loans usually have low interest rates and offer attractive repayment terms, benefits, and options. Generally, repayment of a federal loan does not begin until after the student leaves school
  

Interest Rate

For undergraduate students, Federal Direct Subsidized loans offered from July 1, 2013 until June 30, 2014 have a fixed interest rate of 3.86%. 

• Graduate students are no longer eligible for Federal Subsidized loans (efffective July 1, 2012)

Apply for a Federal Direct Subsidized Loan

To apply for a Federal Direct Subsidized 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 Subsidized Loan, it will be included on your financial aid award.

Loan Requirements Federal Direct Subsidized Loan

Loans require, 3 steps (www.studentloans.gov)

1. Accept the loan

2. Complete a master promissory note (MPN)

3. Complete entrance counseling

• MPN & Entrance Counseling only need to be completed once (both are good for ten years)

Adjust/Cancel your Loan

• 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 here for loan adjustment” is located under the Accept Award Offer tab
  

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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

Interest Rate

Federal Direct Unsubsidized loans July 1, 2013 – June 30, 2014 have a fixed interest rate of 3.86%  

Apply for a Federal Direct Subsidized 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.

Loan Requirements Federal Direct Unsubsidized Loan

Loans require, 3 steps (www.studentloans.gov)

1. Accept the loan

2. Complete a master promissory note (MPN)

3. Complete entrance counseling

• MPN & Entrance Counseling only need to be completed once (both are good for ten years)

Adjust/Cancel your Loan

• 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 here for loan adjustment” is located under the Accept Award Offer tab

*It is available to you through the William D. Ford Federal Direct Loan Program, if your estimated Cost of Attendance (COA) is greater than your other financial aid and you have not reached your annual or aggregate maximum loan limit through the Federal Direct Subsidized Loan program. The interest rate for Federal Direct Unsubsidized loans disbursed on or after July 1, 2012 is fixed at 6.8%. You are charged interest on this loan from the time the loan is disbursed until it is paid in full. If the interest is allowed to accumulate, the interest will be added to the principal amount of the loan and increase the amount to be repaid.

Apply for a Federal Direct Unsubsidized Loan

To apply for a Federal Direct Subsidized 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 award notice.

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Federal Direct Parent PLUS Loan

Parent Loans for Undergraduate Students (Federal Direct Parent PLUS) are federal loans that parents with good credit histories may borrow to help pay the educational expenses of a dependent undergraduate student enrolled in at least 6 credit hours per semester.
A parent may borrow up to the total of the estimated cost of attendance. The interest rate is a fixed interest rate of 7.9% and is charged on the loan from the time the loan funds are disbursed until it is paid in full.

• Federal Parent PLUS Loan are low interest loans that parents can obtain to help pay the cost of education for their children. These loans are available for parents on behalf of the student once the FAFSA and the financial aid file have been completed

• 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

3 Steps to applying for the Parent PLUS Loan

1. PLUS Loan Application
   2013-2014 PLUS Loan Applications will be available June 1, 2013

The e-sign process does require that the parent borrower have a federal PIN, which is the PIN you used to sign the FAFSA. If you are a biological parent whose information is not on the FAFSA, you should apply for a federal PIN.

2. Master Promissory Note (valid up to ten years)

3. Parent PLUS Authorization Form 
   

   A BIOLOGICAL PARENT NOT ON THE FAFSA MUST SUBMIT THE  AUTHORIZATION FORM FOR NON-CUSTODIAL PARENT PLUS LOAN

ELIGIBILITY

Both the parent borrower and the student must:

Be a U.S. citizen or eligible non-citizen
Not be in default on any student loan or owe a federal grant repayment
The student must be in compliance with the UAH Satisfactory Academic Progress requirements
Be enrolled at least half-time

The parent borrower must:

Be a biological parent
Be an adoptive parent (not a legal guardian)
Be a step-parent, eligible only if income and assets were included on FAFSA to calculate student's   
Expected Family Contribution (EFC)

• The processed FAFSA application and a completed award package must be posted on the student account for the award year in which the student is enrolled before the parent completes the PLUS Request Process

• You will receive information on whether the parent was approved or denied after successfully completing the application.  If you are approved, please complete the MPN, then complete & return the Parent PLUS Authorization Form to our office.

• Please allow two weeks for our office to process and post to the student award once you have received an approval.  

• The Office of Student Financial Services will disburse funds to the student's account as long as the student meets eligibility requirements.

• If the disbursed amount exceeds charges on the student's account, a refund check is issued to either the parent or the student based on the parent’s choice when the completing the Parent PLUS application.

LOAN AMOUNTS  

Parent borrowers may borrow a PLUS loan for an amount up to the student's cost of attendance minus other financial aid/scholarships/resources received. It is recommended that you borrow the minimum amount needed to cover the student's educational costs. 


INTEREST RATES, LOAN FEES, REPAYMENT

Federal Direct PLUS Loans have fixed interest rate of 6.41%. Interest is charged from the date of the first disbursement until the loan is paid in full.

• Repayment begins within 60 days after the loan has fully disbursed.  An origination fee of 4% is deducted from this loan at disbursement. Federal Direct PLUS Loan information is also available at http://studentaid.ed.gov

ADVERSE CREDIT HISTORY

If your Plus Loan is denied by the U.S. Department of Education’s Direct Loan Servicing Center due to adverse credit history and you indicated on the Parent PLUS Authorization Form that you will have an endorser, you have 14 days to obtain an approved endorser. After 14 days, if you have not obtained an approved endorser your PLUS loan application will be terminated. If thee PLUS denial is reversed due to the endorser’s approved credit, please contact our office.

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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. The interest rate is fixed at 5.41%. There is a 4.0% 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

APPLY

1. Log in to banner self-service

2. Enter Secure Area using your user ID (A-number) / UAH pin number

3. Select financial aid/award/Grad Plus Application  

• Recommend Federal Loans Exhausted prior to using a Grad Plus Loan

• Complete Master Promissory note for Grad Plus

• Complete Entrance Counseling for Grad Plus

• Master Promissory Note (valid up to 10 years)

Student Eligibility

The Graduate Plus Loan application initiates a credit check by the United States Department of Education. You authorize the credit check when you submit the Graduate Plus loan application.


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.

Denied

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:

• Apply for the loan with an endorser, which is a credit-worthy loan cosigner

• Correct any invalid information on your credit report and reapply

• If a Federal Direct Graduate PLUS Loan Application is denied, you will need to contact Direct Loans at 1.800.848.0979 to add a cosigner

Locate your servicer at www.nslds.ed.gov.

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Loan FAQ'S

Loans require half-time enrollment, which is six credit hours in the Fall/Spring/Summer for undergraduate students.

Exception for graduate student enrollment during the summer term we can accept three credit hours as half-time enrollment.

The lender of your student loans or Parent PLUS Loan is the U.S. Department of Education.

The U.S. Department of Education contracts with multiple servicers to manage Direct Loans. These services are responsible for the billing, collection and processing of all deferments, forbearances and cancellations.

UAHuntsville processes and disburses loan funds to your internal UAH account. You can accept, reduce, cancel or adjust your loans on your Student Self-Service account.

Locate your servicer at www.nslds.ed.gov.

Complete a FAFSA each year you need aid.

The student has 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.

Limits:

Dependent Students have a maximum loan limit of $31,000 while obtaining their undergraduate degree.

Independent Students have a maximum loan limit of $57,500 while obtaining their undergraduate degree.

Requirements:

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 is 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 UAHuntsville.

By accepting your financial awards, you are agreeing to give UAHuntsville 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.

Identify Your Loan Problem:

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:

• Equifax

• Experian

• TransUnion

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.

 

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.

 

Parent PLUS Loan FAQ's

Parent PLUS Loans require 3 steps:

1. Complete the Federal Direct Parent PLUS Loan Application for Fall, Spring, and Summer
2. Complete the Master Promissory Note for Parent Loan.
3. Complete and submit Parent Plus Authorization Form to 212 University Center or Fax to (256) 824-6212.

A declined Parent PLUS Loan changes the student's aggregate loan limit from the dependent loan limit of $31,000 to the independent loan limit of $57,500 for the academic year.

Graduate PLUS Loan FAQ's

The Graduate PLUS Loan requires 2 steps:

1. Submitting the Graduate PLUS application
2. Completing a separate Masters Promissory Note (MPN) in addition to an unsubsidized MPN, and separate Entrance Counseling.

 The student must not have a negative credit history to receive a Grad PLUS Loan.

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What If...

What if I have to withdraw from all my classes in the midst of a term? Will I have to repay any or all of my aid?

The student 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.

What if I only have to withdraw (drop) one class?

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.

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News...

NEW- Subsidized Loan information!

Plus loan application process has changed!

Federal Direct PLUS Loan

The ability to submit a loan adjustment is now available through your Student Banner Account at http://register.uah.edu.

click here for more information

Graduate and Professions Student as of July 1, 2012

Graduate and professional students are no longer eligible to receive Federal Direct Subsidized Loans. The terms and conditions of Direct Subsidized Loans received by any student for loan periods beginning before July 1, 2012, for either graduate or undergraduate study, are not affected by this change.
The aggregate loan limit for graduate and professional students remains unchanged at $138,500, not more than $65,000 of which may be in subsidized loans. All Federal Direct loans originated after July 1, 2012 will have an increased Origination Fee with one exception as noted⁺ below, the Budget Control Act of 2011 (BCA) terminates the authority of the Department of Education (the Department) to offer any repayment incentives to Direct Loan borrowers to encourage on-time repayment of loans, including any reduction in the interest rate or origination fee, effective for loans first disbursed on or after July 1, 2012.As a result of this change, the up-front interest rebate that has been provided to Direct Loan borrowers at the time of their loan disbursement will no longer be offered on any Direct Loan Program with a first disbursement date that is on or after July 1, 2012.

NOTE: Undergraduate borrowers will begin accruing interest on new loans during the six-month grace period. The consolidated Appropriations Act of 2012 initiated Federal Direct Subsidized loan interest to begin accruing during the six-month grace period for all loans originated from July 1, 2012 through June 30, 2014.The interest rate for Federal Direct Subsidized loans will change from 3.4% to 6.8% beginning July 1, 2012. Unsubsidized Stafford loans will remain at a fixed 6.8% rate.

⁺The law continues to authorize the Department to offer interest rate reductions to Direct Loan borrowers who agree to have payments automatically electronically debited from bank account.

 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.

For Student Loans, an origination fee of 1.051% of the total loan will be assessed will automatically be deducted. For PLUS loans, an origination fee of 4.204% will be assessed and automatically deducted. The net disbursement will reflect these fees; therefore, the amount credited to the student’s account will be less than the loan amount. This fee is determined by the U.S. Department of Education.

WE'RE HERE TO HELP!

If you have questions about loans email or call 256.824.6241.

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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.

For Student Loans, an origination fee of 1.051% of the total loan will be assessed will automatically be deducted. For PLUS loans, an origination fee of 4.204% will be assessed and automatically deducted. The net disbursement will reflect these fees; therefore, the amount credited to the student’s account will be less than the loan amount. This fee is determined by the U.S. Department of Education.