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Welcome Students!

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Welcome Students! Chaffey College Financial Aid Direct Loan Workshop DEFAULT If you do not make any payments on your federal student loans for 270-360 days and do not ... – PowerPoint PPT presentation

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Title: Welcome Students!


1
Welcome Students!
  • Chaffey College Financial Aid Direct Loan
    Workshop

2
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.

3
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.

4
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.

5
Information and Application Process
  • To be eligible for a Federal Stafford Loan

? Before you can be considered for a Stafford
Loan, you must be considered for other Title
IV funds.
? 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.
6
WHAT IS IN MY LOAN PACKET?
  • 1. Loan Check List

Step 1 Complete a FAFSA! (Free Application for
Federal Student Aid)
Direct Loan Check List
Direct Loan Check List
Direct Loan Check List
Direct Loan Check List
Direct Loan Check List
Loan Check List
Complete Loan Application Worksheet .
1. Complete Loan Application Worksheet.
1. Complete Loan Application Worksheet.
1. Complete Loan Application Worksheet.
1. Complete Loan Application Worksheet.
1. Complete Loan Application Worksheet.
Complete online Master Promissory Note (MPN)
at www.dlenote.ed.gov Print confirmation
page after completing MPN.
2. Complete online Master Promissory Note (MPN)
at www.dlenote.ed.gov Print
confirmation page after completing MPN.
2. Complete online Master Promissory Note (MPN)
at www.dlenote.ed.gov Print
confirmation page after completing MPN.
2. Complete online Master Promissory Note (MPN)
at www.dlenote.ed.gov Print
confirmation page after completing MPN.
2. Complete online Master Promissory Note (MPN)
at www.dlenote.ed.gov Print
confirmation page after completing MPN.
2. Complete online Master Promissory Note (MPN)
at www.dlenote.ed.gov Print
confirmation page after completing MPN.
.Complete online Entrance Counseling with
Entrance Test at www.dl.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. Print confirmation
page after completing the entrance counseling.
.Complete online Entrance Counseling with
Entrance Test at www.dl.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. Print confirmation
page after completing the entrance counseling.
.Complete online Entrance Counseling with
Entrance Test at www.dl.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. Print confirmation
page after completing the entrance counseling.
.Complete online Entrance Counseling with
Entrance Test at www.dl.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. Print confirmation
page after completing the entrance counseling.
.Complete online Entrance Counseling with
Entrance Test at www.dl.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. Print confirmation
page after completing the entrance counseling.
Complete online Entrance Counseling with Entrance
Test at www.dl.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. Print confirmation
page after completing the entrance counseling,
.You have 30 days (from the date of your Loan
Workshop) to submit the following documents
together to the FA Office 1. Completed Loan
application worksheet 2. Copy of confirmation
of online MPN. 3. Copy of confirmation of
online entrance counseling. All three documents
must be turned in together in order to be
submitted to FA Office. Incomplete packets or
packets that exceed the 30 days will not be
processed. Unfortunately, there are no
exceptions.
.You have 30 days (from the date of your Loan
Workshop) to submit the following documents
together to the FA Office 1. Completed Loan
application worksheet 2. Copy of confirmation
of online MPN. 3. Copy of confirmation of
online entrance counseling. All three documents
must be turned in together in order to be
submitted to FA Office. Incomplete packets or
packets that exceed the 30 days will not be
processed. Unfortunately, there are no
exceptions.
.You have 30 days (from the date of your Loan
Workshop) to submit the following documents
together to the FA Office 1. Completed Loan
application worksheet 2. Copy of confirmation
of online MPN. 3. Copy of confirmation of
online entrance counseling. All three documents
must be turned in together in order to be
submitted to FA Office. Incomplete packets or
packets that exceed the 30 days will not be
processed. Unfortunately, there are no
exceptions.
.You have 30 days (from the date of your Loan
Workshop) to submit the following documents
together to the FA Office 1. Completed Loan
application worksheet 2. Copy of confirmation
of online MPN. 3. Copy of confirmation of
online entrance counseling. All three documents
must be turned in together in order to be
submitted to FA Office. Incomplete packets or
packets that exceed the 30 days will not be
processed. Unfortunately, there are no
exceptions.
.You have 30 days (from the date of your Loan
Workshop) to submit the following documents
together to the FA Office 1. Completed Loan
application worksheet 2. Copy of confirmation
of online MPN. 3. Copy of confirmation of
online entrance counseling. All three documents
must be turned in together in order to be
submitted to FA Office. Incomplete packets or
packets that exceed the 30 days will not be
processed. Unfortunately, there are no
exceptions.
Submit the completed loan application worksheet,
along with a copy of MPN confirmation , and copy
of entrance counseling confirmation to the
Financial Aid office within 30 days of attending
Loan Workshop or loan will not be processed.
processed.
After receiving your first disbursement of loan
funds, you must complete Online Exit counseling
with Exit Test at
www.dl.ed.gov And Submit copy of exit
test to Financial Aid Office. IMPORTANT NOTICE
Student must complete Exit Test in order to
receive second disbursement of federal student
loan.
.Online Exit counseling complete with Exit Test
completed after student has received first
disbursement. Completed online at
www.dl.ed.gov Once Exit Test is completed,
submit copy of confirmation to FA Office.
IMPORTANT NOTICE Student must complete Exit
Test in order to receive second disbursement of
federal student loan.
.Online Exit counseling complete with Exit Test
completed after student has received first
disbursement. Completed online at
www.dl.ed.gov Once Exit Test is completed,
submit copy of confirmation to FA Office.
IMPORTANT NOTICE Student must complete Exit
Test in order to receive second disbursement of
federal student loan.
.Online Exit counseling complete with Exit Test
completed after student has received first
disbursement. Completed online at
www.dl.ed.gov Once Exit Test is completed,
submit copy of confirmation to FA Office.
IMPORTANT NOTICE Student must complete Exit
Test in order to receive second disbursement of
federal student loan.
.Online Exit counseling complete with Exit Test
completed after student has received first
disbursement. Completed online at
www.dl.ed.gov Once Exit Test is completed,
submit copy of confirmation to FA Office.
IMPORTANT NOTICE Student must complete Exit
Test in order to receive second disbursement of
federal student loan.
.Online Exit counseling complete with Exit Test
completed after student has received first
disbursement. Completed online at
www.dl.ed.gov Once Exit Test is completed,
submit copy of confirmation to FA Office.
IMPORTANT NOTICE Student must complete Exit
Test in order to receive second disbursement of
federal student loan.
Typical processing time for Direct Stafford Loans
is 5-6 weeks after all requested loan
information has been received and your financial
aid file has been reviewed.
Typical processing time for Direct Stafford Loans
is 5-6 weeks after all requested loan
information has been received and your financial
aid file has been reviewed.
Typical processing time for Direct Stafford Loans
is 5-6 weeks after all requested loan
information has been received and your financial
aid file has been reviewed.
Typical processing time for Direct Stafford Loans
is 5-6 weeks after all requested loan
information has been received and your financial
aid file has been reviewed.
Typical processing time for Direct Stafford Loans
is 5-6 weeks after all requested loan
information has been received and your financial
aid file has been reviewed.
Typical processing time for Direct Stafford Loans
is 5-6 weeks after all requested loan
information has been received and your financial
aid file has been reviewed.
7
WHAT IS IN MY LOAN PACKET?
  • 2. Online Master Promissory Note Process

8
WHAT IS IN MY LOAN PACKET?
  • Completed online at www.dlenote.ed.gov
  • Follow all steps in the MPN Process handout
    given.

9
WHAT IS IN MY LOAN PACKET?
  • 3. Loan Request Form

10
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.

11
Where can I find these websites?
12
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.
13
TYPES OF LOANS
  • Subsidized Loans
  • The government makes the interest payment on
    your student loan while you are in school, your
    grace period or deferment
  • Unsubsidized Loans
  • You are always responsible for interest
    payments, even while in school.

14
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 is
  • 5.6 fixed

15
Loan Limits and Interest Rate
  • The 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

16
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)

17
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.

18
REPAYMENT
  • During 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

19
REPAYMENT
  • If 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.

20
REPAYMENT
  • Early 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

21
GRACE PERIOD
  • One 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.

22
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.

23
LOAN STATUS
  • You are responsible for notifying your lender
  • When you have returned to school.
  • You may view your loan and enrollment status by
    accessing NSLDS at www.nslds.ed.gov

24
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.

25
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.

26
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.

27
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.

28
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.

29
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.
  • Rehabilitation You may qualify if you're
    participating in an approved rehabilitation
    program. There is no time limit on this deferment.

30
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.

31
FORBEARANCE
  • If you don't qualify for deferment, you may be
    able
  • to work out a special arrangement with your
    lender
  • called 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
    lenders discretion.

32
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

33
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.

34
DEFAULT
  • If 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.

35
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.

36
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.

37
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.

38
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

39
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 Processing The Clearinghouse
    provides automatic and paper-based deferment
    processing for students of its participating
    schools.

40
GUIDE TO MANAGE LOANS
  • Access Direct Loans to manage your loan account
    at www.dlservicer.ed.gov

41
End of Financial Aid Loan Workshop
  • Thank you for attending!

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