Federal Student Loans 

Applying for a Federal Stafford Loan

Complete the following steps to apply for a Federal Stafford Loan:

1. Complete the Free Application for Federal Student Aid (FAFSA)
2. Return your signed Financial Aid Award Notice to the Financial Aid Office (this will be mailed to you once the Financial Aid Office has received and processed your FAFSA)indicating the loans and amounts you are accepting.  You may borrow the amount of your choosing up to the full amount offered on your Financial Aid Award Notice.

Students accepting a Federal Stafford Loan for the first time at Westminster College should also:

1. Complete online Federal Stafford Loan Entrance Counseling
2. Complete online Master Promissory Note

Are you a first time loan borrower?

If you have never previously borrowed a Federal Perkins or Stafford Loan, you will be required to complete what is called Loan Entrance Counseling. Loan Entrance Counseling will provide you with useful information regarding what your loan terms are and how loan repayment will work. You can complete Stafford Loan Entrance Counseling online. If you are a first time Federal Perkins Loan borrower you may either complete Perkins Loan Entrance Counseling online or contact the Perkins Loan Coordinator at (801) 832-2129 to set up an individual appointment.

Federal Perkins Loans

Federal Perkins Loans are low-interest loans awarded to undergraduate students with exceptional financial need. Students will automatically be considered for the Federal Perkins Loan by completing the FAFSA.

• no payment, no interest while in school
• fixed 5 percent interest
• 9 month grace period following graduation
• requires half-time enrollment

The loan amount will vary based on a student's level of need and available funding. Awards generally range from $1,000 to $2,500 per academic year. The loan will be applied directly to the student's account after the Master Promissory Note has been signed and the student has completed Perkins Loan Entrance Counseling 

Federal Stafford Loans

Federal Stafford Loans are long-term, low interest loans awarded to students by the Westminster College Financial Aid Office and are funded through the William D. Ford Federal Direct Student Loan Program. Eligibility for these loans are not based on credit history or income. 

Subsidized and Unsubsidized Stafford Loans

There are two types of Federal Stafford loans: subsidized and unsubsidized.  Students are not required to make payments on either type of loan while enrolled at least half-time in an eligible educational institution. However, students may choose to make regular or interest-only payments while enrolled.

• Subsidized Stafford Loans are awarded to students who demonstrate financial need. These loans are interest free while the student is enrolled at least half-time at an eligible educational institution or during authorized deferment periods. Interest is charged when the loan is in a repayment or forbearance status.
• Unsubsidized Stafford Loans are awarded regardless of a student's demonstrated financial need. These loans generate interest charges as soon as they are disbursed. The interest charges may be deferred during enrollment (at least half-time) and deferment periods, but they will be capitalized (added to the outstanding loan balance).

Stafford Loan Amounts

The amounts awarded on the Federal Stafford Loans are based on a student's academic level and status as either a dependent or independent of their parents as determined on the FAFSA. (To determine your maximum loan eligibility see the dependent undergraduate and independent undergraduate tables below.)  Dependent undergraduate students may borrow up to a total of $31,000 (no more than $23,000 may be subsidized). Independent undergraduate students and dependent undergraduate students whose parents are unable to borrow through the Federal PLUS Program may borrow up to a total of $57,500 (no more than $23,000 may be subsidized).

Please note that these amounts indicate the federal maximums.  Individual student loans are based on the student's need level, expected costs, other financial aid, and additional factors.

Students awarded a Stafford Loan will be required to sign a Master Promissory Note during the first academic year that the funds are borrowed. The loan amount will be applied directly to the student's account once a Master Promissory Note has been signed and the student has completed Stafford Loan Entrance Counseling.

Terms and Conditions of Stafford Loans

Interest Rates

Federal Stafford Loans disbursed on or after July 1, 2006 have a fixed interest rate of 6.80%.  The College Cost Reduction and Access Act will adjust the fixed interest rate on all undergraduate Subsidized Stafford Loans as follows:

Fees

All Federal Stafford Loans may be subject to an origination (1.5%) and insurance fee up to 2.5%, taken from the value of the loan at the time it is disbursed to the school.  The loan amounts listed above and on the Financial Aid Award Notices represent the gross amount of the loan (amount before fees have been paid). The Higher Education Reconciliation Act will adjust Stafford Loan origination fees according to the chart below: 

 Repayment

Loan repayment usually begins 6 months after the student graduates, leaves school, or drops below half-time enrollment.  Repayment will initially be scheduled for fixed monthly payments over a 10 year period.  Other repayment options are also available.