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Federal Direct Loan Program

Introduction
Participation Requirements
Mandatory Entrance and Exit Loan Counseling
First-Time Borrowers, Loan Disbursement Delay
Loan Cancellation
Over-Awards
Loan Amount Adjustments
Loan Disbursements
Late Promissory Notes
Late Disbursement
January Graduation
Loan Denials
Deferment
Forbearance
Additional Information

Introduction

Columbia College has been approved by the Secretary of Education to participate in the Federal Direct Student Loan Programs (FDSLP) and Federal Direct Parental Loan Program (FDPLP). Columbia does not participate in the Federal Family Educational Loan Program (FFELP).

The FDSLP and FDPLP programs allow students and parents to borrow directly from the Treasury of the United States, rather than from a lender such as a bank or credit union. Additionally, FDSLP and FDPLP loans will not need to be "guaranteed" by an outside guarantee agency, as they are federally guaranteed

Participation Requirements top

In order to participate in the FDSLP or FDPLP programs you must:

Complete your 2003-2004 financial aid file.
Meet general eligibility requirements.
Fill out a Parent Loan Certification Form.
Submit a promissory note (if appropriate).

If you are approved for a FDSLP, or your parents for a FDPLP, SFS will contact you in order to negotiate your loan proceeds. Since you will be borrowing from the U.S. Treasury, Columbia will electronically draw down your loan proceeds; there will be no bank or credit union loan check. If a refund is due you, a Columbia College refund check will be mailed to you by the Student Financial Services Office.

Mandatory Entrance and Exit Loan Counseling top

The Department of Education and Columbia College Chicago requires that:

All first time borrowers (undergraduate, second BA, BFA degree and graduate students) MUST complete an entrance conseling session on the Department of Education web site. You must print out the form that indicates you passed the quiz and submit it to Student Financial Services before any loan funds can be disbursed.
All undergraduate, second BA, BFA and graduate students who will graduate at the end of a semester, who leave the College, or drop below six credit hours and who have borrowed (an) educational loan(s) must complete an exit loan counseling session on the Department of Education web site. You must print out the "Rights and Responsibilities Checklist" and submit it to Student Financial Services before your diploma will be released.

First-Time Borrowers, Loan Disbursement Delay top

Federal regulations require that the disbursement of loan proceeds for first time borrowers be delayed until 30 days after the first day of classes. This federal requirement includes both disbursement and refund of loan proceeds.

Loan Cancellation top

You and/or your parent may cancel a Federal Direct Subsidized/Unsubsidized Stafford Loan or a Federal Direct Parent Loan in accordance with current federal regulations. Normally, after loan proceeds have been credited to your college account, an informational letter is mailed to you by the Office of Student Financial Services. This letter will describe specific time limitations to the loan cancellation process. If a student and/or parent refund has already been issued prior to the Office of Student Financial Services receipt of your loan cancellation request, the student and/or parent remains responsible for the repayment of the refunded amount. If either the time limitation has lapsed or the Office of Student Financial Services procedures have not been followed, no loan cancellation will be processed.

Over-Awards top

An overaward is aid that exceeds your calculated need. If an over-award occurs, it must be addressed by reducing need-based aid according to current federal and state regulations until the over-award is eliminated.

An over-award usually occurs when an additional resource becomes available to a student after other need-based aid, including a subsidized Stafford Loan, has been awarded. The additional resource could be a late arrival of a grant/scholarship. In any case, the need-based aid will be adjusted to eliminate such an over-award.

It is your responsibility to inform the Office of Student Financial Services of additional resources as they become available to you.

Loan Amount Adjustments top

A student may adjust his/her loan amount once per academic year, this includes adjustments due to academic level changes. A parent of an otherwise eligible dependent undergraduate student may adjust a parent loan amount once per academic year. All adjustments must meet federal regulations. Consult a Student Financial Services representative.

Loan Disbursements top

The Student Financial Services Office is responsible for loan disbursements. Student and parent loans must be multiple disbursed, whether for the academic year or one-term only (this includes the Columbia College Chicago Study Abroad Program). Loan proceeds will be disbursed according to the Columbia College Chicago disbursement schedule.

The policies, procedures and schedules of the Student Financial Services Office govern the disbursement of all financial aid, including student and parent loans. The disbursement of financial aid will comply with all current federal or other awarding agencies' regulations concerning these disbursements.

Late Promissory Notes top

In order to have a promissory note produced, the loan must have already been originated. If such a note is returned no later than ten days after the last day of enrollment for the period of the loan, the promissory note may be processed.

However, disbursement of loan proceeds in such a situation is governed by federal regulations for late disbursements and Columbia College Chicago Office of Student Financial Services policies and procedures.

Late Disbursement top

Late disbursement of loan proceeds is governed by federal regulation and Columbia College Student Financial Services' policies and procedures. A student or parent loan may be disbursed no later than ninety days after the end of the enrollment period for the period of the loan, provided that all other requirements have been met.

Student Financial Services' decision is final in all late disbursement situations; all decisions must be in compliance with current federal late disbursement regulations.

January Graduation top

Students who graduate in January are not eligible for an academic year loan. Such loans will be pro-rated to reflect that you have less than an academic year remaining in your program of study.

Loan Denials top

Federal loans may be denied if a student is in loan default status, owes a Title IV refund, is uncreditworthy, has already received the maximum grade-level loan amounts for the academic year, or has already received the total aggregate loan amount(s) permissible as an undergraduate and/or graduate student.

Deferment top

You have a right to postpone loan repayment if you provide your Servicer with a deferment request and evidence that verifies your eligibility for the deferment. Deferments are available in the following situations:
At least half-time study at an eligible school.
While you are pursuing a graduate fellowship program or a rehabilitation training program for individuals with disabilities (provided the program is approved by the Department of Education).
While you are conscientiously seeking but unable to find full-time employment (for up to three years).
For any reason (in accordance with federal regulations) that causes you to have economic hardship (for up to three years).

Forbearance top

A forbearance is an arrangement to reduce your payment amount or to temporarily stop making payments. During a period of forbearance, interest charges continue to accrue. If you are willing, but financially unable, to make payments under your repayment schedule, you may request one of the following forms of forbearance:

A short period during which you make no payments.
An extension of time for making payments.
A period during which you make smaller payments than were originally scheduled.

Under certain conditions, your Servicer is required to grant you a forbearance:

If you meet specific criteria while serving in a medical or dental internship or residency program.
If you are serving in a federally defined national service position for which you receive a national service education award under the National and Community Service Trust Act of 1993.
If your annual debt burden for all federal Title IV student loans equals or exceeds 20 percent of your disposable income.

Additional Information top