Stafford Loan Entrance Counseling

Transcription

1 Stafford Loan Entrance Counseling 1

2 Parents Parents are welcome at this presentation, but a parent attending this session will not satisfy the student s loan counseling requirement If your student is unable to be at this session, he or she can complete the counseling requirement at: mnsu.edu/campushub 2

3 Table of Contents Privacy and Minnesota State Mankato Free Application for Federal Student Aid Financial Aid Process Financial Aid Package Stafford Loans Living the College Life Satisfactory Academic Progress Rights and Responsibilities Odds and Ends 3

4 Family Education Rights and Privacy Act (FERPA)! Information regarding a student s financial aid cannot be given to any individual other than the student regardless of their relationship to the student The student may sign a release of information at the Campus Hub to allow information disclosure to specific individuals 4

5 Campus Hub First point of contact for Student Financial Services Fastest way to get answers, and where to turn in your forms for Student Financial Services 5

6 Free Application for Federal Student Aid (FAFSA) 1. FAFSA Online is available at: 2. Paper FAFSA 3. Renewal FAFSA You can access your renewal FAFSA on the web. The federal processing center will you a PIN reminder. The Federal Processor only sends a paper Renewal Application if you previously filed a paper FAFSA and did not provide an address. The FAFSA must be completed every year 6

7 Student Aid Report (SAR) The SAR will report the information from your application and give your Expected Family Contribution (EFC) You receive the SAR by an link if you filed online or provided an address on a paper FAFSA: Review it carefully to ensure correct data. If there are errors, you can correct them online. If you receive a paper SAR, you can correct and mail in to the federal processor. 7

8 Requests for Information Once you submit your FAFSA, the Federal Processor sends Minnesota State Mankato a copy of information you submitted When Minnesota State Mankato receives your data, it is reviewed. If there are any questions, Student Financial Services will send a letter requesting additional information. You must respond to these requests for information, or your application cannot be processed 8

9 The Financial Aid Process Determining Cost of Attendance (COA): What an education costs Each year, Student Financial Services determines average costs for attending Minnesota State Mankato and living in Mankato for nine months 9

10 Direct vs. Indirect Costs Direct Costs Indirect Costs Expenses resulting from enrollment in an educational institution Tuition Fees Books Expenses not directly a result of enrollment in an educational institution Rent Laundry Parking Entertainment Food 10

11 Cost of Attendance The direct costs +The indirect costs The Cost of Attendance (COA) 11

12 How is Need Assessed? Cost of Attendance minus the Expected Family Contribution (EFC) equals Need $ 14, MN Undergrad COA - 2,000 (Sample EFC) $ 12,988 Financial Aid Need 12

13 Financial Aid Package Sent to you by Student Financial Services Award Letter Necessary Forms for Loan Processing Additional Information Requests as Needed Relevant Financial Aid Information 13

14 Definitions Guarantor: Guarantees to the Federal Government that they will repay the loan if it is not paid by the student (as a result of disability, death, or default) Lender: Provides the money for the loan Servicer: Company that maintains the loan for the lender. This organization will send bills, interest statements, disclosure statements, and any other paperwork that is needed 14

15 Award Letter Gives breakdown of aid by term and enrollment status Keep a copy for your records 15

16 Two Options for Completing the Process With your Tech Id and password, you may complete the entire award acceptance process. Your Tech Id is on the top of your award letter 16

17 Accessing eservices Your MSU account can be accessed at mnsu.edu/eservices Your password is initially set to either The last six digits of your SSN Or Your birth date in YYMMDD format 17

18 Response Form / LAF If accepting Federal Stafford Loans, complete both sides of the Response Form / Loan Acceptance Form (LAF) 18

19 Response Form Indicate the types of aid that you would like to accept Please only accept the aid types which have been awarded to you Indicate any additional funding not listed on your award letter RESPONSE FORM 19

20 Loan Acceptance Form (LAF) LTF Indicate the Lender Code of the Lender you have chosen Indicate the amounts of Stafford Loans you would like to accept equal or less than what you were awarded 20

21 Choosing a Lender All lenders follow the same guidelines We recommend that you choose one of the lenders from the list of recommended lenders, however you may choose ANY lender that participates in the Stafford Loan Program 21

22 Master Promissory Note (MPN) First time borrowers at Minnesota State Mankato Must complete MPN online at: Once there click on Master Promissory Note 22

23 Recap Send Response Form / LAF to the Campus Hub Complete MPN online at: Once there click on Stafford Master Promissory Note (MPN) 23

24 Disclosure Statement Sent by Guaranty Agency Includes: Loan Amounts Loan Fees (if any) Lender and Servicer Information 24

25 Subsidized v. Unsubsidized Subsidized: Need-Based Aid No interest while you are in school Unsubsidized: Non Need-Based Aid Accrues interest while you are in school. The interest can be paid quarterly or capitalized. Payment on principal begins six months after you are finished with school (graduate, withdraw or drop below half-time) 25

26 Capitalizing Interest Student A $8,000 in loans over 4 years Pays $1360 interest while in school Begins payment on the principal of $8000 Repays a total of $11,047 Student B $8,000 in loans over 4 years Pays $0 interest while in school Begins payment on the principal of $9,360 Repays a total of $11,565 Savings of $518 for Student A who paid interest while in school 26

27 Stafford Interest Rate 6.80% Effective July 1, 2006 The Federal Stafford Loan Program converted from a variable rate structure to a fixed rate of 6.8% 27

28 Paying the Stafford Interest While the student is enrolled at least half-time or in a period of deferment, the Federal Government pays the interest on the student s Subsidized Stafford Loan(s). Whether enrolled or not, it is the student s responsibility to pay the interest on their Unsubsidized Stafford Loan(s). The student may either make interest payments to the lender/guarantor, or they may choose to not pay the interest in which case the interest will be added to the principal balance when the loan goes into repayment. 28

29 Stafford Aggregate Limits MSU Grade Levels 0-29 credits credits credits 90+ credits Graduate Students Dependent Students Aggregate Limits Independent Students Aggregate Limits $3,500 $23,000 $7,500 $46,000 $4,500 $23,000 $8,500 $46,000 $5,500 $23,000 $10,500 $46,000 $5,500 $23,000 $10,500 $46,000 $18,500 $138,500 29

30 Stafford Loans LOANS ARE A PRIVILEGE Unlike other forms of aid, loans are not a right!!! The Federal Stafford Loan Program is available to most students who complete a Free Application for Federal Student Aid (FAFSA) 30

31 Alternative Loans If you have an amount listed as, Other Loan Options, that number represents the most that you can borrow in an Alternative Educational Loan, SELF Loan, and/or PLUS Loan The eligibility for these loans is divided evenly into two disbursements when the loan is requested for the Fall and Spring 31

32 How to Live the College Life (or, How to Be Poor) Plan Ahead! Be prepared for up front expenses such as books, rent deposits, supplies, etc Financial aid funds are typically available 10 business days after the first day of classes 32

33 How to Live the College Life Planning Ahead Know what financial resources will be available to you (i.e. financial aid, savings, assistance from relatives, etc ) Know what your costs will be Reduce your consumer debt and credit card bills as much as possible before you come to school 33

34 How to Live the College Life Reduce Expenses Buy used books Live on-campus, or with roommates Use coupons, cook at home or get a meal plan on-campus Be aware how you spend your money day to day 34

35 How to Live the College Life Reduce Expenses Buy used books Live on-campus, or with roommates Use coupons, cook at home or get a meal plan on-campus Be aware how you spend your money day to day 35

36 How to Live the College Life Money Management & Debt Management Stay away from college student credit cards Keep your checkbook and savings information current Budget your expenses Resources Available Apply for Financial Aid Look for scholarship opportunities 36

37 How to Live the College Life Borrowing What you get now will impact what you are able to get in the future Borrow wisely and conservatively Plan for your future! 37

38 Enrollment Statuses Full Time ¾ Time Undergraduate Students Credits 9 11 Credits Graduate Students 6 or More Credits ½ Time 6 8 Credits Changing Enrollment Status May Affect Financial Aid Eligibility! Please Contact the Campus Hub Before Dropping Classes! 38

39 Satisfactory Academic Progress Standards (SAPS) Cumulative GPA: 2.0 for Undergrads, 3.0 for Grads Completion Rate: 67% of registered classes Maximum Timeframe Undergraduate: 192 credits Graduate: Varies by program All SAPS Criteria are checked at the end of each semester. You must appeal the suspension to regain financial aid eligibility 39

40 Borrower s Rights Loan obligation information Copy of Promissory note Original Paid-in-full notice Interest rates/ fees Loan balance Repayment schedule Notification of Loan sale/ transfer Interest benefits Grace period Pre-payment without penalty Deferment while in school Request Forbearance or Deferment 40

41 Notify Your Servicer Do not enroll Drop below 6 credits Graduate or Withdraw Change Schools Change Your Name or Address Experience Repayment Difficulty Need a Deferment or Forbearance Change Employer or Employer Address 41

42 Consequences of Default Ineligible for future financial aid Collection agency or other legal action Difficulty obtaining credit Seizure of tax refunds, wages and/or property Loss of deferment or monthly payment options You will have to pay in full 42

43 Federal Student Loan Ombudsman The Federal Student Loan Ombudsman s Office works with student loan borrowers to resolve loan disputes and problems

44 Keep This Stuff Copies of Loan Application/Prom Note Borrower Disclosure Statement Loan Repayment Schedule Deferment or Forbearance Requests Correspondence with Lender Records of Loan Payment Cancelled Checks Money Order receipts Name and Address of Lender and Servicer ALL INFORMATION FROM STUDENT FINANCIAL SERVICES 44

45 Helpful Web Site mnsu.edu/campushub MSU Campus Hub Website ed.gov Department of Education finaid.org Scholarship Search and EFC estimator fastweb.com Scholarship Search Petersons.com Education and Career Center Homepage 45

46 Student Financial Services Please visit the Campus Hub if you have any questions (507) Academic Year Hours: Summer Hours: 8:00am-6:00pm M-TH 8:00am-5:00pm F 8:00am-4:00pm M-F 46

47 Helpful Web Site MSU Campus Hub Website Department of Education Scholarship Search and EFC estimator Scholarship Search Education and Career Center Homepage 47