This change will NOT affect any prior year federal loans.
If you are a new or continuing student borrower who plans to borrow federal loans in the 2010-11 aid year, this change will impact you. As of the fall semester, all Federal Stafford and PLUS loans will be processed through the Federal Direct Loan program.
The Direct Loan Program offers: A guaranteed source of funding for student loans A lower interest rate on PLUS loans A single point of service for students during repayment Additional repayment options for students and interest rate reductions for on time payment The Public Service Loan Forgiveness Program
On March 25th, 2010, the U.S. House of Representatives and the U.S. Senate passed The Health Care and Education Affordability Reconciliation Act of 2010. This bill makes major changes in several federal student aid programs AND mandates the Federal Direct Loan Program. The Family Federal Education Loan Program, which permitted private lenders to originate these […]
No. All federal loans will be processed through the Federal Direct Loan Program.
The interest rate for Direct subsidized and Unsubsidized loans is the same as that of the FFEL program. However, the PLUS loan interest rate is 7.9% compared to the FFEL program interest rate of 8.5%
What happens to the Stafford loans I borrowed in previous years? Will they still be deferred now that Black Hawk College is changing it loan process?
Your Stafford loans from previous years should remain in deferment as long as you are enrolled above half time for your program. You are responsible for notifying your lender if your enrollment status changes.
Many FFEL lenders have been selling their loan portfolios to the Department of Education for servicing during the past two years. You will have the option of making separate payments to each agency/loan servicing company OR you can also opt to consolidate all loans into one Federal Direct Consolidation Loan.
The application process for Direct Loans is the same as for FFEL Loans. U.S. Citizens or permanent residents can apply for direct Loans by completing the Free Application for Federal Student Aid (FAFSA). The financial aid offices will process your application and sent you notification when your financial aid is ready to review and accept.
You can find information about the servicers of you other federal loans at StudentLoans.gov. You will need your pin from the FAFSA to access this site.