Student Financial Resources and Scholarships (SFRS) Student Loan Automatic Packaging Q & A

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1 Student Financial Resources and Scholarships (SFRS) Student Loan Automatic Packaging Q & A What is Student Loan Automatic Packaging? Student Loan Automatic Packaging is the process of predetermining eligibility and awarding a student loan based on the student s financial need and the federal loan program guidelines. Specifically, the system is packaging your eligibility for Federal Direct Subsidized and Federal Direct Unsubsidized loans. What are Federal Direct Subsidized and Federal Direct Unsubsidized Loans? Federal Direct Subsidized Loans are loans made to eligible undergraduate students who demonstrate financial need to help cover the costs of higher education at a college or career school. Federal Unsubsidized Loans are loans made to eligible undergraduate, graduate, and professional students, but in this case, the student does not have to demonstrate financial need to be eligible for the loan. For both types of loans, students must be enrolled at least half-time and meet eligibility requirements to receive financial aid. What do I need to do? Your Financial Aid Award is available online. Student loans have been pre-packaged for this academic year. Steps to View Financial Aid Award Letter: 1. LOGIN on Online Services, Click on Student. 2. Go the Financial Aid Section. 3. Click on View and Take Action on My Financial Aid Loans. 4. Choose Financial Aid Year ( ). Click Continue. Example: = Fall/Winter 5. Scroll to the bottom of the page to Accept, Reject or Change (decrease) the loan(s). (You can only make one change). Press Submit. Borrow only what you need. Loans have to be repaid with interest. 6. Select Financial Aid Award Letter to view your official awards. 7. If you are a new, first-time borrower at OCC, you must complete the Entrance Counseling and the Master Promissory Note (MPN) available at What happened to the Online Student Loan Application? Fall and Winter semester loans will be automatically packaged. Summer I and II semester will use the Online Student Loan Application for processing loans. What is the advantage to this new process? As a student, you don t have to complete the online loan application and wait to be processed. Your loan will be processed faster offering you the maximum amount based on your eligibility. However,

2 your student loan may be reduced or cancelled based on changes in other financial aid awards or enrollment of less than half-time. What are the Annual Loan Limits? Combined subsidized and unsubsidized Dependent Students Additional unsubsidized Total Stafford Freshman $3,500 $2,000 $5,500 Sophomore $4,500 $2,000 $6,500 Independent students and dependent students whose parents cannot borrow a PLUS Loan Combined subsidized and unsubsidized Additional unsubsidized Total Stafford Freshman $3,500 $6,000 $9,500 Sophomore $4,500 $6,000 $10,500 Aggregate Loan Limits Undergraduate dependent students: $31,000 of which no more than $23,000 can be subsidized Undergraduate independent students: $57,500 of which no more than $23,000 can be subsidized What are the interest rates for Federal Direct Loans? Loan Type Fixed Interest Rate Federal Direct Subsidized for Undergraduate Students 4.66% Federal Direct Unsubsidized for Undergraduate Students 4.66% Federal Direct Parent PLUS 7.21% Due to the Bipartisan Student Loan Certainty Act of 2013, Direct Loans interest rates will be tied to the financial market. Under the new interest rate structure, rates will be determined each June for new loans and will be fixed for the life of the loan. The rated are calculated using a 10-year Treasury Note Index plus an add-on amount for each loan program, and include interest rate caps. Learn more about how interest is calculated from the U.S. Department of Education.

3 What are the origination fees and up-front interest rebates? Federal Direct Loan Fees for FY 2014 and 2015 Loan Type Impacted Loans Loan Fee Percent Fee Example Federal Direct Subsidized & Federal Direct Unsubsidized Loans FY 2014 December 1, 2013 and before October 1, 2014 FY 2015 October 1, 2014 and before October 1, $58.96 on a $5,500 loan $59.01 on a $5,500 loan Federal Direct PLUS Loans (Parent and Grad/Prof Student) FY 2014 December 1, 2013 and before October 1, 2014 FY 2015 October 1, 2014 and before October 1, $ on a $10,000 loan $ on a $10,000 loan What if I don t want a student loan? Depending on your eligibility, you have been offered a subsidized and/or unsubsidized loan. Click reject and submit. If you later make a decision to keep the loan, you must speak with the campus Student Financial Resources and Scholarships office. What if I make a mistake? You can only make one change online. Visit the campus SFRS. Will it take longer if I am selected for verification? It may. Your financial information has to be validated. If corrections are needed, this information is resubmitted to the federal government for processing. You should respond to all requests for additional information immediately.

4 What is Entrance Counseling? A federally mandatory information session which takes place before you receive your first federal student loan that explains your responsibilities and rights as a student borrower. Review entrance loan counseling for complete list of requirements at Note: Entrance Counseling takes at least 30 minutes to complete. What is the Master Promissory Note (MPN)? It is the binding legal document that you must sign when you get a federal student loan. It lists the terms and conditions under which you agree to repay the loan and explains your rights and responsibilities as a borrower. It s important to read and save this document because you ll need to refer to it later when you begin repaying your loan or at other times when you need information about provisions of the loan, such as deferments or forbearances. Can I complete the new Master Promissory Note (MPN) now? Yes. Review and complete the MPN at This is the portal for all Federal Direct Loan borrowers to manage their Federal Direct Loans. You will use your PIN, which is the same PIN used for FAFSA. The name and address of two references residing at two different addresses must be provided, along with other demographic information. You will need your driver s license/state ID and social security number. How do I know if I am a New, First-Time Borrower at OCC? If you did not receive a loan under the Federal Direct Stafford Student Loan Program at OCC and you did not receive a loan during the school year or after, you are a First-Time Borrower at OCC. How do I get more loan money? The system has automatically packaged the maximum loan(s) based on your eligibility. It may be necessary to decline other types of aid to receive more loan money; however, you do not want to decline/reject free money (grants) to receive a student loan. Speak with your campus SFRS to review your options. How do I get Federal Work-Study and student loans? See your campus SFRS. Your student loan will have to be adjusted to cover the work-study award. Can my student loan amount change? Yes, based on new information about other financial aid received. Will I be able to go to the bookstore? Yes, you will be limited to $800 per semester. You can only purchase one computer per academic year. There is no separate bookstore account. You are using pending financial aid to purchase books. If you don t complete the Entrance Counseling and MPN, your loan will not disburse. Therefore, you will be responsible for all bookstore charges not covered by your other financial aid awards.

5 What if I drop classes before disbursement? You must be enrolled for at least 6 credits for the student loan to disburse. Dropping classes before disbursement could affect your ability to receive a loan. What if I receive an N mark? You will owe the money back (including loans) and you will not be allowed to register again until the balance is paid. What if I withdraw from all my classes? Your financial aid eligibility will be recalculated based on specific federal regulations. This recalculation may require you to repay money as a result of your complete withdrawal. When will the loans disburse? Disbursement occurs after the 100% drop/add period is over. See OCC website to view refund dates. Refunds are not handled by SFRS. Any financial aid amount remaining after tuition, fees, books, and supplies will be disbursed according to the Check Refund Disbursement Schedule. Your refund will be available via direct deposit or paper check. Oakland Community College also offers the Raider One card. If you have an activated Raider One card, your tuition and financial aid refunds, if applicable, will be available on the card. Your tuition and financial aid refunds are available via the Debit MasterCard feature. The Debit MasterCard feature of the card allows for ATM usage at all campus ATMs and at Money Pass branded ATMs. Visit for convenient locations nearest you. What can prevent me from getting my student loan? Registration for less than six credits, no MPN and/or Entrance Counseling, default, eligibility changes will prevent you from getting your student loan. What about Summer I and II in 2015? Student loans will be packaged at the maximum up to cost of education based on eligibility. This could mean you will not have funds or will have limited funds available for Summer I or II semesters. If students want to attend summer, they should determine their maximum eligibility by reviewing the annual before accepting loan funds. If you have received maximum loans for your grade level, you cannot receive another loan until you advance to the next grade level. For example, Grade Level One (0-31 credits), maximum loan $9,500 for an independent student. For the next loan eligibility, you must have 32 credits. SFRS

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