University of the Arts London US Loan Guide for 2015/2016

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1 University of the Arts London US Loan Guide for 2015/2016 American students studying at University of the Arts London on a full-time, degree bearing and eligible course can borrow United States government (federal) and/or private loans to fund their studies. This US Loan Guide provides comprehensive information about the different loans available and the steps you must take to successfully apply for funding. Please take the time to read through the information below and then follow our 7 Steps to Apply. Federal Loans (Direct Stafford and Direct PLUS) Direct Stafford Loans American students are always advised to borrow a Direct Stafford loan first as these loans are partially subsidized by the US Government and have lower interest rates. Since Stafford loans are government funded, there are specific allowable borrowing limits based on age and study level. The proportion of the loan that is subsidized (US government pays the interest for you while you are in school) versus unsubsidized (you pay the interest yourself) varies according to your age and level of study but may also be affected by your income (or that of your family) and your previous borrowing history. The most you can borrow per year is based on your age and level of study so you can use the information below to determine what you can borrow. The Bipartisan Student Loan Certainty Act of 2013 ties federal student loan interest rates to financial markets which means that each year, typically in May/June, new interest rates will be determined and fixed at a particular rate for the life of the loan. The current Undergraduate Stafford subsidized and unsubsidized loans sit at 4.29% and Postgraduate Stafford unsubsidized loans sit at 5.84%. Dependent Undergraduates (under age 24) Subsidized Unsubsidized Total Foundation/Diploma (grade level 01) $3500 $2000 $ st year BA or 1 st year Foundation Degree (02) $4500 $2000 $ nd / 3 rd year BA, 2 nd year Foundation Degree or Graduate Diploma (03/ 04) $5500 $2000 $7500 Independent Undergraduates (24 and over) Subsidized Unsubsidized Total Foundation/Diploma (grade level 01) $3500 $6000 $ st year BA or 1 st year Foundation Degree (02) $4500 $6000 $10,500 2 nd / 3 rd year BA, 2 nd year Foundation Degree or Graduate Diploma (03/ 04) $5500 $7000 $12,500 Postgraduate Students (MA/PhD/Postgrad Diploma) Subsidized Unsubsidized Total (Grade level A-D, depending on year) $0 $20,500 $20,500 Federal loans will be disbursed in equal instalments at the start of each term. For the majority of students, this means 3 equal instalments but some programmes will receive two instalments. These disbursement arrangements are a requirement of the US 1

2 Government s Deficit Reduction Act 2005 (HEA 428G(e)), effective 1 st July 2006, and must be strictly followed. The University allows a tuition fee payment instalment policy for those students who are fullyreliant on US loans. This is defined by one who borrows loans that at least cover their full tuition fees. In such cases, each loan instalment will automatically be put towards your tuition fees and any excess funds will be refunded to you to use for your living costs. If there are any shortfalls, you ll be contacted to make the balance payment. If your loans disburse in three instalments, fees will be paid in three instalments. If your loans disburse in two instalments, fees will be paid in two instalments. Alternatively, students may still wish to pay their fees in full at the start of the year where possible. If you are fully reliant on US loan funding, you must ensure that each loan instalment is enough to pay the tuition payment as well as your living costs for each term. You may need to borrow several loans to accrue enough funding if you don t already have personal funds or scholarships. We are happy to help you calculate the correct loan values needed so that your loan instalments work for you. Refunds off the loans take approximately one to two weeks to be processed. Direct Parent and Graduate PLUS Loans Parent PLUS and Graduate PLUS loans are applied for in the same way as Stafford loans. Unlike the Stafford Loan, however, the Graduate and Parent PLUS loans are subject to an adverse credit history check. Both PLUS loans are presently fixed at a 6.84% interest rate. Parent PLUS loans are federal loans taken out by a parent on behalf of a student and are only available to students under age 24 who are studying at undergraduate level. If the parents are denied on their application for a Parent PLUS loan, and do not wish to pursue a PLUS loan with the addition of an endorser/co-signer, then their child (the student) is eligible to be considered independent for Stafford loan purposes. Please alert us as soon as possible if your PLUS loan is denied and provide us with the relevant supporting paperwork so we can adjust the Stafford loan amounts accordingly. While Parent PLUS loans generally go into repayment immediately, a parent borrower can request to defer repayment during the student s studies and/or for an additional 6 months after the student graduates. Parents must request to have their loan deferred directly through the lender. Graduate PLUS loans are available to postgraduate students (MA, PhD or Postgraduate Diploma courses only) and are borrowed by the student. Graduate PLUS loan borrowers must apply for the maximum Stafford loan available to them before being allowed a Graduate PLUS. This loan, like the Parent PLUS, can also be deferred during your studies but you must request this yourself, with the lender, otherwise the loan will go into repayment immediately. Processing Loans After we have received the necessary paperwork from you, a dialogue will begin via about your loans. Once any discrepancies are resolved, all correct paperwork is received, and the amount you wish to borrow is confirmed, the loans will be certified and guaranteed. You will be sent an confirming your loans and the disbursement dates so please keep that safe. Provided we receive all the relevant information from you, it should only take a few days for the loans to be processed. 2

3 Eligibility While most of our courses are eligible for federal loans, our Graduate/Postgraduate Certificates, short courses, Study Abroad, programmes classified as distance education and some research programmes are ineligible for federal loans. Our International: Introduction to the Study of Fashion course at LCF and our International: Introduction to Study in Design and Media Communication at LCC are also ineligible. If you are unsure if your course is eligible, please ask us. Please also note that students cannot undertake ANY STUDY in the United States when borrowing US loans through the University. This includes research for postgraduate purposes, work term placements etc. If you choose to undertake study in the US, you cannot borrow US loans for that period. Private Loans Due to the multiple disbursement policy on all federal loans, you may require funds in addition to (or instead of) a Stafford or PLUS loan. Private loans are credit-based and almost all students will require a credit-worthy co-signer. You can borrow a loan value up to your estimated Cost of Attendance minus any federal loans, grants or scholarships that you are receiving. Private loans can disburse in a single instalment or you can select to have two instalments. The only private loan we are eligible to certify for our students is the Sallie Mae Smart Option loan and this loan has historically been disbursed as a cheque, in US dollars, to the University but we are working with Sallie Mae towards having these funds wired from now on. All the details of the Sallie Mae loans, including interest rates and how to apply can be found here: Accommodation and Loans Loans can be used towards your housing costs but, upon arrival to the UK, loan monies will not be available in time for students to pay initial deposits or rent. When faced with overseas transactions, foreign currencies and occasionally cheques, refunds cannot be processed quickly. Additionally, you must set up a UK bank account in order to bank your refund cheques and have access to your loan funds, a process that can take several weeks. There are certain Halls that are financially managed by the University s Accommodation Team. If you live in one of the following Halls, we can allocate some of your loan money to your termly rental payments if requested: Brooke Hall Camberwell Campus The Costume Store The Glassyard Building Will Wyatt Court Sketch House Highline Building If you live in a Hall of Residence NOT listed above, their management companies will have specific payment timelines and so you will have to arrange to make your housing payments yourself in advance and then you can refund yourself with the loan money later. 3

4 It is your responsibility to inform us if you want to use your loan money towards your accommodation costs as these payments will not be allocated automatically. We can only do this if you are living in one of the Halls listed above. Deposit Payments and Loans The University of the Arts London charges students joining a new course a non-refundable deposit of 2,000. The deposit will be put towards your tuition fee costs. Loan funds are not available to pay this deposit as they can only be disbursed to students after formal enrolment has occurred. You will have to pay the deposit from your own funds and reimburse yourself from your loan money later. Loan funds will also not be available for any housing deposit payments that you may need to make to Accommodation Services, typically due in June. Withdrawal and the Return of Federal Loans If you withdraw or fail to attend your course, you must inform us immediately. If you withdraw from your programme of study before, and up to, a point in time when 60% of your programme of study has passed, the University is required, in accordance with federal regulations, to return all unearned loan funds to your guaranty agency or lender. This is also stipulated on your loan Master Promissory Note. If your loan funds are drawn down from the US Treasury and you inform us that you will not be attending or requiring the loan funds after this time, you will be liable to pay any conversion charges and costs associated with the return of the funds. It is your responsibility to inform us if you will not be attending or if you wish to have some of your loan instalments cancelled before they are wired from the US. This same policy applies to instalments disbursed throughout the year. If your second or third instalment disburses and you then decide you no longer need the funds, it will be your responsibility to return those funds to the lender. We are happy to cancel instalments for you but you must request this from us at least 2 weeks in advance of the scheduled disbursement dates. Loan Deadlines and Entry Clearance In order to secure a student visa, you must provide proof that you can pay your full tuition fees and the estimated living expenses. Your offer letter will outline your tuition fees and your offer pack, which is ed to you, provides information regarding the living/maintenance funds that must be demonstrated. Please refer our Cost of Attendance document which details the estimated cost of living we use for US loan certification purposes. These figures are higher than what UK Visas and Immigration requires, but are deemed more accurate. You must apply for your loans in a timely manner, as we will have to provide you with an original letter for your visa application scanned/ ed/faxed versions of this letter cannot be used. You must apply early enough so that the loans have time to be processed and guaranteed. We cannot assist you with any issues relating to the inability to pay tuition fees or acquire entry clearance due to a late loan application. The recommended deadline to apply for your loans is August 1 st for courses starting in September and December 1 st for courses starting in January. 4

5 If you have additional questions after reading the information provided on our website, please contact: Melissa Chatton Manager International Student Loans and Scholarships University of the Arts London International Admissions 272 High Holborn, London, UK WC1V 7EY Phone: (011 44) Steps to Apply for Federal Loans Begin by completing a FAFSA ( AFTER you and your family have filed your taxes in April. We typically recommend you start this process in May at the earliest. The FAFSA will generate your Student Aid Report (SAR) which we need when certifying you for any federal loans. You will need the school code when filling out the FAFSA and University of the Arts London s code is G Please do not use any other school code for University of the Arts London other than the one listed here in red. When you have completed your FAFSA, wait for the information to upload which takes hours. Log back in to view your SAR and check it for errors. The front page of the SAR will have any error messages listed and the problematic items will either have a * or an h next to them. Review these issues and make corrections where necessary. We need an error-free SAR before we can work on your loans. Completing the FAFSA does not mean you have applied for loans. You must now submit your Master Promissory Note (MPN) electronically through You will need a PIN (the same PIN that you created to complete your FAFSA). The MPN is the contract between you and the lender and we need one of these for any federal loan you wish to borrow. You must submit an MPN for any federal loan you wish to borrow (Stafford, Parent PLUS or Graduate PLUS). The school code to use on the MPNs is again G34733 which is linked to University of the Arts London only and not a specific college/site. When you have completed your MPN(s), you should be able to view them as PDF files in the site. You will need to the PDF(s) of your MPN(s) to us. You may be informed that they are sent to us automatically but this only pertains to US institutions. If you are borrowing a PLUS loan (Parent PLUS or Graduate PLUS) you must provide us with the amount you wish to borrow. The Stafford loan has set allowable amounts and we assume that you want the full Stafford allowance but if you don t, you must inform us accordingly. To get an idea of how much you can borrow, please see our Cost of Attendance document in the US loan web-pages. 5

6 Complete your Entrance Counselling only if you are brand new to the University of the Arts London or if you are starting on a new course with us. This is a requirement of the US Department of Education and can be completed on the same site where you submit your MPNs: Counselling must only be submitted by students borrowing Stafford loans or Graduate PLUS loans. Please again ensure to use the same school code as before, G34733, so that you attach your counselling correctly. Send an to m.chatton@arts.ac.uk with: confirmation that you have submitted your FAFSA and checked your SAR for errors MPN(s) attached in PDF format the amounts you wish to borrow for each loan confirmation that you have completed your Entrance Counselling (if applicable). 6