Welcome Students!Chaffey College Financial Aid

Direct Loan Workshop

RECENT CHANGES TO THE LOAN PROCESS

The Federal Stafford Loan process at Chaffey has been

streamlined to facilitate awarding and funding your

student loans.

Chaffey College previously participated in the Federal Family Educational Loan Program (FFELP), but as of 2008-2009 academic year, Chaffey has transitioned into the Direct Loan Program.

RECENT CHANGES TO THE LOAN PROCESS You will not be required to select a lender because the

Department of Education is the lender for Direct Loans.

You also do not have a choice to select another lender or a previous private lender because Chaffey participates in the Direct Loan program.

If you have previously borrowed under the FFELP loan program, you may have a lender and/or guarantor who manages your loans. If that is the case, you will be required to report to your previous lender and the Department of Education regarding changes, such as enrollment, deferment, etc.

RECENT CHANGES TO THE LOAN PROCESS

New Loan Request Form

Annual loan amounts have increased

Important information has been added to assist you in managing your loans.

Information and Application ProcessTo be eligible for a Federal Stafford Loan:

□ Complete the Free Application for Federal Student Aid (FAFSA)

□ Maintain Satisfactory Academic Progress

□ Enroll in at least six (6) units per semester in a program leading to a degree/ certificate at Chaffey College and/or transfer to a university.

□ Not be in default on any student loan or owe a refund on Title IV Funds

□ Not be over your aggregate limits for federal student loans.

□ Before you can be considered for a Stafford Loan, you must be considered for other Title IV funds.

WHAT IS IN MY LOAN PACKET?

1. Loan Check List

Step 1: Complete a FAFSA! (Free Application for Federal Student Aid)

WHAT IS IN MY LOAN PACKET?

2. Online Master Promissory Note Process

WHAT IS IN MY LOAN PACKET?

Completed online at www.dlenote.ed.gov

Follow all steps in the MPN Process handout given.

WHAT IS IN MY LOAN PACKET?

3. Loan Request Form Chaffey College District DIRECT LOAN REQUEST

Borrower Information: Student ID:_______________________________Student Social Security #_________________ Name:__________________________________________________________________________ (Last) (First) (Middle) Address:________________________________________________________________________

Street City State Zip Birthdate:________________ Phone Number:_________________ E-mail:_______________________ Expected Graduation Date:____________________

Maximum Eligibility for:

Dependent Student Independent Student

Subsidized Unsubsidized Subsidized Unsubsidized Freshman $3,500 $2,000 $3,500 $6,000 Sophomore $4,500 $2,000 $4,500 $6,000 Requested Loan amount: $______________ Circle your anticipated enrollment for the following semesters: Fall 2009 Spring 2010 ½ (6-8.5 units) ½ (6-8.5 units) ¾ (9-11.5 units) ¾ (9-11.5 units) Full-time (12 units or more) Full-time (12 units or more)

If I do not qualify for the subsidized loan requested, I authorize Chaffey College to process an unsubsidized loan for the same amount.

DEADLINE TO APPLY FOR A LOAN AT CHAFFEY COLLEGE IS MAY 15TH. Chaffey College Office of Financial Aid 5885 Haven Avenue Rancho Cucamonga, CA 91737-3002 http://www.chaffey.edu/finaid

SCHOOL CODE: 001163

I understand that to obtain a loan at Chaffey College, I must attend a loan workshop and return this form to the Financial Aid Office. In addition, I must have completed an electronic Master Promissory Note (MPN) and the Online Entrance Counseling with the Department of Education. By signing this form, I give consent to Chaffey College to initiate the loan process for the requested loan period. I understand I must be enrolled for a minimum of 6 units at the time of disbursement in order to receive my loan funds. I also understand that if I completely withdraw from all coursework, federal regulations require the Financial Aid Office to perform a calculation to determine how much financial aid I have earned. I will be required to return unearned financial aid received. _______________________________________ _____________________ Signature Date

Online Entrance and Exit Counseling Both completed online at:

ww.dlenote.ed.gov

Click on “Entrance and Exit counseling” logo Select “Go” under Entrance Counseling. Select “Tutorial and Quiz (New Session)” under

the Stafford Loan option.

**Students must pass entrance counseling to receive a federal student loan.

Where can I find these websites?

IMPORTANT INFORMATION

After completing your Loan Request Form, online MPN and entrance test, you must submit completed Loan Request Form to the Financial Aid Office.

Typical processing time is 5-6 weeks after all loan information has been received and your financial aid file has been reviewed.

Please complete the exit test after you receive your first disbursement.

TYPES OF LOANSSubsidized Loans The government makes the interest payment on

your student loan while you are in school, your grace period or deferment

Unsubsidized LoansYou are always responsible for interest payments, even while in school.

Loan Limits and Interest Rate

The Maximum annual subsidized loan limits:

First Year (0-29.5 completed units) $3,500

Second Year (30 or more completed units) $4,500

Subsidized Loan Interest Rate is5.6% fixed

Loan Limits and Interest RateThe maximum annual unsubsidized loan

amounts:

DEPENDENT STUDENTS First Year (0-29.5 completed units) $2,000 Second Year (30 or more completed units) $2,000

INDEPENDENT STUDENT First Year (0-29.5 completed units) $6,000

Second Year (30 or more completed units) $6,000

Interest Rate is 6.8% fixed

LIFETIME AGGREGATE AMOUNTS

Dependent Undergraduate Student $31,000 (no more than $23,000 of which may be subsidized)

Independent Undergraduate Student $57,500 (no more than $23,000 of which may be subsidized)

LOAN ORIGINATION FEES□ Direct loans have an origination fee of

1.5%.

□ However, your loan funds will be reduced by only .5% because Direct Loans offer a rebate

incentive of 1.0%.

□ If you do not repay your loan funds on time, the 1.0% rebate will be added to your loan balance.

REPAYMENTDuring your grace period your lender will send you

repayment and disclosure statement listing your:

Monthly payment Payment due dates Length of repayment Current interest rate

REPAYMENTIf you don't hear from your lender, call and update them on your address and

other information, such as new telephone number or name change.

For Stafford Loans, your grace period begins the day after you graduate, withdraw, or drop to less than half-time status.

The length of your grace period depends on the type of loan you have, but

most are six months. Your first loan payment will be due approximately

30 to 45 days after your grace period ends. Be proactive about loan

repayment. Even if your lender doesn't notify you, you're still responsible

for making timely loan payments.

REPAYMENTEARLY REPAYMENT You can prepay all or part of your loan at any

time, without penalty. In fact, it's to your advantage to pay off your loans as quickly as possible to reduce interest costs.

REPAYMENT PERIOD Generally, you're entitled to a minimum of five years and a

maximum of 10 years to repay your loan (as long as you meet the minimum monthly payment of $50). In some cases the minimum payment will pay the loan off in less than five years

GRACE PERIODONE GRACE PERIOD PER LOAN When you drop below half-time enrollment status

you have six months before you're required to make monthly payments. This payment-free time is called a grace period. During this time, no principal payments are due. If you have a subsidized loan, the government pays the interest. If you have an unsubsidized loan, you're responsible for interest payments.

You only receive one grace period per loan. Once your grace period expires, you can't get it back.

GRACE PERIOD RENEWAL If, prior to the end of your grace period, you re-

enroll at an eligible school on at least a half-time basis, your Stafford Loan will return to its former in-school status and repayment will again be postponed. The next time you leave school your grace period will start over.

If you don't re-enroll during your grace period, repayment will begin as scheduled. At this point in time, you will not be eligible for an additional grace period on your loan. However you may qualify for loan deferment.

LOAN STATUSYou are responsible for notifying your lenderWhen you have returned to school.

You may view your loan and enrollment status by accessing NSLDS at:

www.nslds.ed.gov

What Is A Student Loan Deferment?When you are unable to repay a loan, you

may go into deferment.

When you are in deferment, you are not required to make payments on your loan.

Deferment is a temporary postponement of payments.

DEFERMENTS

During deferment, you don't have to make any principal payments on your loan.

If you have a subsidized Stafford Loan, interest

payments on the loan will be made for you by the federal government.

If you have an unsubsidized Stafford Loan, you're responsible for interest payments during periods of deferment.

How to Qualify for a Deferment? Must apply by requesting a

deferment from each lender.

Please note: If you have loans from different lenders, you must apply for a deferment from each lender.

How to Qualify for a Deferment? Deferment must be approved by lender. You

will receive notification from lender of approval or denial. If not, follow up by contacting lender and submitting additional documents if needed.

Deferments are offered for a limited time,depending on the type of deferment.

TYPES OF DEFERMENT Unemployment

You may qualify for an unemployment deferment if you're looking for but unable to find employment. The deferment can last for up to three years. You must provide documentation to your lender that you are actively seeking employment.

DEFERMENT OPTIONS In-School

You may qualify if you're enrolled at least half-time in an eligible school. There is no time limit on this deferment.

RehabilitationYou may qualify if you're participating in an approved rehabilitation program. There is no time limit on this deferment.

DEFERMENT OPTIONS Economic Hardship

You may qualify if you're constrained by severe financial circumstances. The deferment is limited to three years.

If none of the deferment options above match your circumstances, contact your lender.

FORBEARANCEIf you don't qualify for deferment, you may be ableto work out a special arrangement with your lendercalled a forbearance. During periods of forbearance you can reduce or

postpone monthly payments. You are responsible for any interest that accrues

on your subsidized or unsubsidized Stafford Loans during this time.

NOTE: Forbearances are granted at the lender‘s discretion.

DELINQUENT LOANS A delinquency period begins on the first

day after you miss a payment.

Collection efforts by the lender begin immediately.

If you are having trouble making payments, contact your lender

DELINQUENT LOANS If you are delinquent of your student loans, it will

show up on your credit report.

Whether or not you receive notice your loans are in repayment, you must make a payment by scheduled due date.

If the delinquency goes on for nine months, your loan

holder may declare you in default.

DEFAULTIf you do not make any payments on your federal

student loans for 270-360 days and do not make special arrangements with your lender to get a deferment or forbearance, your loans will be in default.

Defaulting on your student loans has serious consequences.

CONSEQUENCES OF DEFAULT You may no longer be eligible for future federal or

state aid at any institution. Your loan may become immediately due and

payable. Your loan default status is reported to all major

credit agencies. Your income tax refunds might be withheld and

applied to your loan balance. Your state-issued professional license or

certificate may be withdrawn.

CONSEQUENCES OF DEFAULT Your wages could be garnished. Legal action may be taken against you to enforce

repayment (for which you must pay the court costs and attorney fees).

Collectors will continue collection activities until your account is paid in full (for which you must pay additional interest charges and collection costs).

You could lose access to monthly repayment options such as loan consolidation.

GUIDE TO MANAGE LOANS You must let your lender or servicer know if you change your

address, name, Social Security number, telephone number, enrollment status or school.

Keep all important documentation about your student loan.

Make your monthly payments on time and build a good credit rating.

If you're working with several different lenders, consider loan consolidation.

GUIDE TO MANAGE LOANS View your loan information at: www.nslds.ed.gov

Name of your current lender Outstanding loan balances Information on Pell Grants Loan and enrollment status

To access the NSLDS Student Access Web site you must have a pin number. If you do not remember your pin number, you may acquire a duplicate pin at: www.pin.ed.gov

GUIDE TO MANAGE LOANS The National Student Clearinghouse offers services to assist

students to track their student loans and obtain verification of their in-school status: www.studentclearinghouse.org Enrollment Verify

Online service that allows you to obtain enrollment verification certificates to provide to credit issuers, health insurance companies, student housing providers, and others.

Loan Deferment ProcessingThe Clearinghouse provides automatic and paper-based deferment processing for students of its participating schools.

GUIDE TO MANAGE LOANS Access Direct Loans to manage your loan account at:

www.dlservicer.ed.gov

End of Financial Aid Loan Workshop

Thank you for attending!

Any Questions?