Types of Loans

 

Baker College currently offers loans through the William D. Ford Direct Loan Program (FDSLP). This loan program offers low interest rate loans to students and parents and is available to all qualified students (undergraduate and graduate).

Remember, student loans must be repaid!!


Federal Stafford Direct Loans

Under this program students borrow money directly from the federal government without going through a commercial lender. There are two types of federal Direct Stafford Loans.

  • Federal Direct Subsidized Student Loan: "Subsidized" means the federal government pays the interest on these loans while the student is in school, during the grace period (usually six months grace) and during deferments (postponements of repayment). Students must demonstrated financial need, as determined by federal regulations.

    NOTE: Effective for loans made for periods of enrollment (loan periods) beginning on or after July 1, 2012, graduate and professional students are no longer eligible to receive Direct Subsidized Loans.
  • Federal Direct Unsubsidized Student Loan - "Unsubsidized" means the federal government does not pay the interest while the student is in school, during the grace period or in deferment. Eligibility is not based on financial need. The student is not required to make any payments while he/she is in school, but interest is charged during all periods. Students are responsible to pay the interest on this loan quarterly or may choose to capitalize the interest which is added to the unpaid balance of the loan once a quarter.

Enrollment criteria: Students must be enrolled at least half-time to be eligible for any type of federal student loans. Half time status at Baker College is:

  • Undergraduate student's is six (6) credit hours per term.
  • Graduate student's is four (4) credit hours per term.

Federal Parent PLUS Loan

(Federal Direct Parent Loan for Undergraduate Students)

These loans are non-based loans for parents with good credit histories who want to borrow for their dependent students. Under this program, parents can borrow up to the total cost of education minus other expected financial assistance. Parents may choose one of two repayment options: (1) defer payments on a PLUS loan until six months after the date the student ceases to be enrolled at least half time, pay accruing interest monthly or quarterly, or allow interest to be capitalized quarterly or (2) begin repaying both principal and interest while the student is in school. Interest begins to accumulate at the time the first disbursement is made. Repayment begins within 60 days after the final disbursement of the loan. Baker College is a term school, if a PLUS loan is awarded for a full school year, the disbursements for the loan would be paid in three (3) separate amounts in order to cover each term. Repayment would not begin until after the final or third disbursement of the loan is paid, but interest would start accruing on the loan beginning with the first disbursement paid.

Enrollment Criteria: Undergraduate students must be enrolled at least half time. Half time status at Baker College is:

  • Six (6) credit hours per term.

IMPORTANT INFORMATION ON REQUESTING PLUS LOAN DEFERRAL: After the PLUS Loan has been fully disbursed to the student's account, the parent borrower must call the servicer assigned to their Parent PLUS Loan to request a deferral of loan payments. The parent borrower will be requested to provide the student's Social Security number. The borrower must choose between paying interest monthly, quarterly, or allowing the interest to be capitalized quarterly. If the student has no booked loan with the loan servicer, the parent will be asked to complete a Parent PLUS In-School Deferment Request form or submit a letter on school letterhead indicating the student's enrollment period, expected graduation date, the student's name and Social Security Number and the parent's name and Social Security Number.


Federal Graduate PLUS

(Federal Loans for Graduate Students)

The Graduate PLUS Loan program has been modified to allow graduate students to borrow a PLUS loan. This program is for students in graduate level programs only. Students must file the FAFSA to be considered for a Grad PLUS loan. The Financial Aid Office must determine if eligible for any other types of Direct Loans before a Graduate PLUS loan can be processed. This loan is a non-need loan for students with good credit histories. Applicants may borrow up to the cost of attendance minus other financial assistance. Students will receive an automatic deferment while enrolled at least half-time. The Grad PLUS is not a subsidized loan; consequently, interest will accrue beginning with the first disbursement of the loan.

Enrollment Criteria: Graduate students must be enrolled at least half-time to receive a loan(s). Half time status at Baker College is:

  • Four (4) credit hours per term.

Direct Consolidation Loans

These are loans for students and parents who have more than one lender or servicer and wish to combine different federal student loans into one loan. This type of loan can only be done when a student borrower is no longer in school. Parent PLUS loans can be consolidated at anytime a parent borrower has more than one loan in repayment or a parent can choose to wait until the student has graduated. You can read about Direct Consolidation Loans on the Direct Loan web site at www.direct.ed.gov or view the Baker College web site section on Loan Consolidation for more information.


Sources of Financial Aid


Remember when reviewing your options for receiving financial aid there are different sources of aid besides student loans. The chart below gives you a quick review on what sources are available.

Maximize the Sources of Aid That You Don't Have to Repay

 

Money You Do Not Have To Repay

 

  • Scholarships and Grants
  • Savings
  • Work-Study Earnings

 

Sources of Aid That Do Need to Be Repaid

 

Federal Student Loans

  • Federal Direct Subsidized Stafford Loans
  • Federal Direct Unsubsidized Stafford Loans
  • Federal PLUS Loans
  • Federal Graduate PLUS

Private Education Loans

 

Additional Information - Below are additional web sites to help you locate further information on the Federal Direct Loan Program.

www.direct.ed.gov

www.studentaid.ed.gov

www.federalstudentaid.ed.gov

The Baker College System
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