Loans

Student loans are funds provided to undergraduate, graduate and/or professional students to help assist with educational expenses. Loans are considered self-help financial assistance and must be repaid.

For loan consideration, students must complete the Free Application for Federal Student Aid (FAFSA).

The following loan programs are available to students based on program enrollment, dependency status and eligibility:

Federal Loans:

 

FEDERAL LOANS

William D. Ford Federal Direct Subsidized Loan (Direct Subsidized)

The Direct Subsidized loan is an optional loan offered by the Department of Education. These loans are available to undergraduate students who demonstrate financial need as determined by the Department of Education. Direct Subsidized Loans assist with educational expenses but may not exceed financial need. The student is responsible for repaying the loan.

The interest rate for Direct Subsidized loans first disbursed on or after July 1, 2018 and before July 1, 2019 is 5.05%. No interest is charged while a student is enrolled at least half-time in an eligible school, for the first six months after leaving school (referred to as a grace period*) and during deferment periods. Interest rates are fixed for the life of the loan.

*Students receiving a Direct Subsidized Loan that is first disbursed between July 1, 2012 and July 1, 2014, will be responsible for paying any interest that accrues during the grace period. Any unpaid interest that accrues during the grade period will be added to the principal balance.

150% Direct Subsidized Loan Limit

In July 2012, Congress enacted the Moving Ahead for Progress in the 21st Century Act (MAP-21) [Public Law 112-141]. This law added a new stipulation to the Direct Loan statutory requirements which limits a first-time borrower’s eligibility for Direct Subsidized Loans to a period not to exceed 150% of the length of the borrower’s educational program.

Pursuant to this new provision under certain conditions, first-time borrowers who have exceeded the 150% limit will lose the interest subsidy on their Direct Subsidized Loans.

Only first-time borrowers on or after July 1, 2013 are subject to the new provision. A first-time borrower is generally defined as one who did not have an outstanding balance of principal or interest on a Direct or FFEL Program Loan on July 1, 2013.

 

William D. Ford Federal Direct Unsubsidized Loans (Direct Unsubsidized)

The Direct Unsubsidized loan is an optional loan offered by the Department of Education. These loans available to both undergraduate and graduate students and are not based on financial need as determined by the Department of Education. The student is responsible for repaying the loan.

Interest is charged during all periods; even during the time a student is enrolled at least-half time in an eligible school, during grace and deferment periods. The interest rate for Direct Unsubsidized loans first disbursed on or after July 1, 2018 and before July 1, 2019 is as follows:

  • Undergraduate 5.05%
  • Graduate 6.60%

Interest rates are fixed for the life of the loan.

Eligibility requirements for the Direct Subsidized/Unsubsidized Loan:

  • Must be enrolled at least half-time in a degree-seeking program at a school that participates in the Direct Loan Program
  • Must be a U.S. citizen or eligible non-citizen
  • Must not be in default on any federal education loans or owe an overpayment on a federal education grant

 

To apply for the Direct Subsidized and/or Unsubsidized Loans:

 

William D. Ford Federal Direct PLUS Loan (Parent PLUS) - Dependent Students

Parent PLUS loans are interest-bearing loans for the parents of dependent students who are enrolled at least half-time in a degree-seeking program at an eligible school. This loan assists with educational expenses up to the student’s cost of attendance minus all other assistance. The parent is responsible for repaying the loan.

The interest rate for the Parent PLUS loan first disbursed on or after July 1, 2018 and before July 1, 2019 is 7.60%. Interest is charged during all periods beginning on the date of the loan’s first disbursement. Interest rates are fixed for the life of the loan.
Additionally, applicants pay a loan origination fee which is a percentage of the principal amount of each Parent PLUS Loan received.

Dependent students whose parent(s) have applied for but were unable to obtain a Parent PLUS loan are generally eligible to receive additional Direct Unsubsidized loan funds.

The Parent PLUS loan will be evenly disbursed over the terms of the student’s enrollment for the current award period unless otherwise indicated.

The Parent PLUS loan enters repayment once the loan is fully disbursed. Borrowers may contact the loan servicer to request a deferment for the following reasons:

While the borrower /borrower’s dependent is enrolled in school at least half-time

For an additional six months after the borrower’s dependent ceases to be enrolled in school at least half-time

Interest will accrue on the Parent PLUS loan during deferment. Borrowers may choose to pay the accrued interest or allow the interest to capitalize when the deferment period ends. The loan servicer will notify the borrower when the first loan payment is due.

 

Eligibility requirements for the Direct Parent PLUS Loan:

  • The parent must be the student’s biological, adoptive or stepparent (if the parent has remarried at the time of application)
  • The parent and dependent children must be U.S. citizens or eligible non-citizens
  • The dependent child must be enrolled at least half-time in a degree-seeking program at a school that participates in the Direct Loan Program
  • Parent PLUS loan borrowers cannot have adverse credit history. A credit report will be obtained by the Department of Education. Applicants who are found to have adverse credit history at the time of the credit check may still apply for a Parent PLUS loan with an approved endorser
  • The parent must not be in default on any federal education loans or owe an overpayment on a federal education grant

 

To apply for the Parent PLUS Loan:

  • Complete the Free Application for Federal Student Aid (FAFSA)
  • Parents should complete the Department of Education PLUS loan process as follows:
    • Log in to Studentloans.gov using their FSA ID. When applying for the Parent PLUS Loan, parents should use their full legal as a credit report will be obtained to determine loan eligibility
    • Select the Parent Borrower tab
    • Click on “Apply for PLUS Loan” and follow the application instructions
      • If approved, complete the PLUS Loan Master Promissory Note (MPN)
      • If you are approved with an endorser or through the appeal process, you must complete PLUS Loan Counseling
      • If denied, the student may be eligible for a Federal Direct Unsubsidized Loan. To apply for the Unsubsidized Loan, the student must submit to the Office of Student Financial Services:
        • A copy of the parent’s denial letter/email from the Department of Education
        • A signed letter from the student requesting the additional unsubsidized aid.

The MPN and Counseling will be electronically transmitted to the school.

PLUS Loan awards will be accepted on behalf of the student/parent by the Office of Student Financial Services upon receipt of all completed documentation.

 

William D. Ford Federal Direct PLUS Loan (Graduate PLUS) - Graduate/Professional Students

Graduate PLUS loans are interest-bearing loans for graduate/professional students enrolled at least half-time in a degree-seeking program at an eligible school. This loan assists with educational expenses up to the student’s cost of attendance minus all other assistance. The student is responsible for repaying the loan.

The interest rate for Graduate PLUS loans first disbursed on or after July 1, 2018 and before July 1, 2019 is 7.60%. Interest is charged during all periods beginning on the date of the loan’s first disbursement. Interest rates are fixed for the life of the loan.

Additionally, borrowers pay a loan origination fee which is a percentage of the principal amount of each Graduate PLUS loan received.

The Graduate PLUS loan will be evenly disbursed over the terms of enrollment for the current award period unless otherwise indicated.

The Graduate PLUS loan enters repayment once the loan is fully disbursed. Borrowers may contact the loan servicer to request a deferment for the following reasons:

  • While the borrower is enrolled in school at least half-time
  • For an additional six months after the borrower ceases to be enrolled in school at least half-time

Interest will accrue on the Graduate PLUS loan during deferment. Borrowers may choose to pay the accrued interest or allow the interest to capitalize when the deferment period ends. The loan servicer will notify the borrower when the first loan payment is due.

 

Eligibility requirements for the Graduate PLUS Loan:

  • Must be a U.S. citizen or eligible non-citizen
  • Must be enrolled at least half-time in a graduate/professional degree-seeking program at a school that participates in the Direct Loan Program
  • Graduate PLUS loan borrowers cannot have adverse credit history. A credit report will be obtained by the Department of Education. Applicants who are found to have adverse credit history at the time of the credit check may still apply for a Graduate PLUS loan with an approved endorser
  • Must not be in default on any federal education loans or owe an overpayment on a federal education grant

 

To apply for the Graduate PLUS Loan:

 

The MPN and Counseling will be electronically transmitted to the school.

PLUS loan awards will be accepted on the student’s behalf by the Office of Student Financial Services upon receipt of all completed documentation.

 

FEDERAL DIRECT LOAN FEES

Borrowers pay a loan origination fee on all Direct Subsidized, Unsubsidized and PLUS Loans. The loan fee will be proportionately deducted from each loan disbursement.

Federal Direct Loan Fees are as follows:

Loan Program Fees for loans first disbursed on or after October 1, 2017 and before October 1, 2018 Fees for loans first disbursed on or after October 1, 2018 and before October 1, 2019
Direct Stafford Loan (Subsidized & Unsubsidized) 1.066% 1.062%
Direct PLUS Loan (Parent & Grad/Prof Student) 4.264% 4.248%

 

FEDERAL DIRECT LOAN INTEREST RATES & FORMULA

Interest rates for Federal Direct Loans are set by Congress and are based upon formulas that use the equivalent rates of the 91-day Treasury bill plus a statutory add-on percentage. The calculated rate is capped by a maximum interest rate.

The chart below provides the interest rates for Direct Subsidized, Unsubsidized and PLUS loans:

Fixed Rate Direct Loans
Borrower Loan Program Loans first disbursed on or after 7/1/17 and before 7/1/18 Loans first disbursed on or after 7/1/18 and before 7/1/19
Undergraduate Students Subsidized & Unsubsidized 4.45% 5.05%
Graduate or Professional Students* Unsubsidized 6.00% 6.60%
Parents and Graduate or Professional Students PLUS Loan 7.00% 7.60%

*Pursuant to the Budget Control Act of 2011: Graduate and professional students are not eligible to receive Direct Subsidized Loans for loan periods beginning on or after July 1, 2012

 

The amount of interest that accumulates on your loan from month to month is determined by a simple daily interest formula. This formula consists of multiplying your loan balance by the number of days since the last payment times the interest rate factor.

 

FEDERAL DIRECT LOAN LIMITS

The school uses information from the student’s FAFSA to determine the type of loan(s) and actual loan amount a student qualifies for based on a student’s financial need, dependency status and grade level. There are limits on the amount of Direct Subsidized and Unsubsidized loans a student may be eligible to receive each academic year (annual loan limits) and the total amounts a student may borrow for both undergraduate and graduate study (aggregate loan limits).

The following chart outlines the annual and aggregate limits for Direct Subsidized and Unsubsidized loans:

Direct Stafford Loan Limits
  Undergraduate Students Graduate Students
Dependent1 Independent2
1st Year Annual Limit $5,500 ($3,500)3 $9,500 ($3,500) $20,500 ($8,500)4 for each year
2nd Year Annual Limit $6,500 ($4,500) $10,500 ($4,500)
3rd Year Annual Limit $7,500 ($5,500) $12,500 ($5,500)
Aggregate $31,000 ($23,000) $57,500 ($23,000) $138,5005 ($65,500)

1 Except those whose parents are unable to borrow a PLUS loan
2 These limits also apply to dependent students whose parents are unable to borrow a PLUS loan
3 The numbers in parentheses represent the maximum amount that may be subsidized
4 Graduate and professional students are not eligible to receive Direct Subsidized Loans for loan periods beginning on or after July 1, 2012
5 The aggregate amounts for graduate students include loans for undergraduate study. The aggregate limits include both Direct Subsidized and Unsubsidized Loans and any subsidized and unsubsidized Stafford Loans received through the Federal Family Education Loan (FFEL) Program.

 

Graduate and professional students enrolled in certain health profession programs may qualify for additional Direct Unsubsidized Loan amounts each academic year. Please contact the Office of Student Financial Services for more information about annual and aggregate limits for health profession students.

 

FEDERAL STUDENT LOAN OMBUDSMAN

While students are encouraged to resolve disagreements regarding federal student loan issues with the loan servicer, there are some instances when a neutral third party is necessary to seek a fair and equitable solution. In such cases, students may contact the Federal Student Aid Ombudsman Group to help resolve disputes and mediate federal loan program related conflicts.

Online Phone Fax Mail
Federal Student Aid Ombudsman Group 1 (877) 557-2575 (606) 396-4821 FSA Ombudsman Group
P.O. Box 1843
Monticello, KY 42633

Student Services and Student Engagement

Student Financial Aid
5001 El Paso Drive
El Paso, TX 79905

MSC 21014

Phone: 915-215-4370
Fax: 915-783-5145
Email: elp.financialaid@ttuhsc.edu