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Loans

Loans are money you can borrow from either the Federal government, or private lending agencies such as banks, which must be repaid.LCC participates in the Federal Direct Loan Program. LCC also certifies Alternative Loans for students.

Federal Direct Loans

LCC offers three types of Federal Direct Loans; the lender is the US Department of Education. You must complete the Free Application for Federal Student Aid, FAFSA, in order to determine your eligibility for these loans.

  • Federal Direct Subsidized Stafford Loans are need-based, and interest-free while enrolled at least half time (minimum six credits). The loan is borrowed by the student.
  • Federal Direct Unsubsidized Stafford Loans are not need-based, and accrue interest while you are enrolled at least half-time (minimum six credits) and during repayment. The loan is borrowed by the student.
  • Federal Direct Parent Loan for Undergraduate Students (PLUS) Loans are not need-based and accrue interest while the student is enrolled at least half-time (minimum 6 credits).PLUS Loans are borrowed by a parent to pay for the educational costs of his/her dependent student.

Federal Direct Loan Interest Rates

  • Federal Interest Rates Information
  • Interest which accrues during half-time enrollment may be paid while you are in school or capitalized until you enter repayment.
  • If you choose to capitalize your interest, you will pay more over the life of your loan than you would if you choose to pay the interest only portion of your loan(s) while you are in school.
  • You may choose to pay the interest while in school and then decide that you can no longer afford to do so if you choose

Federal Direct Loan Qualifications

  • Maintain a minimum of half-time status during the semester you wish to receive aid. At LCC, you must be enrolled for six credits to be considered half-time (this includes the Summer Semester).
  • Complete all tracking requirements. Tracking requirements can be viewed through logging into your StarPort account and accessing your Banner Student System.
  • Meet LCC's Satisfactory Academic Progress Policy.

Loans are calculated using cost of attendance (COA) and expected family contribution (EFC).

Federal Direct Subsidized & Unsubsidized Stafford Loans

Review the Federal Direct Loan section above for important information regarding loan types and requirements.

The following charts explain maximum annual loan amounts available to student for the current academic year If you attend multiple institutions during an academic year, the total loans you receive between the institutions cannot exceed the amounts listed.

Loan Limits Table

*A Dependent Student whose parent has been denied a PLUS Loan is eligible for the amounts listed in the independent table.

Once an award offer is made, you can accept, reduce, or decline the amounts by logging into StarPort and accessing your Banner Student System.

If it is your first time borrowing a Stafford loan at LCC, you must complete:

  • Entrance Counseling
    • Tutorial about Federal direct Subsidized and Unsubdizied Loans.
    • From the Direct Loan Servicing Website, select the Entrance adn Exit Cousneling link at the top of the page.
    • Click Go int eh Entrance Counseling section.
    • Click Tutorial and Quiz in the Stafford Loan section.
    • Follow the instruction provided.
    • LCC will receive electronic notification that you have completed the session 1-2 days after you have done so.
  • Master Promissory Note
    • The agreement between you and the federal Government to repay the Federal Direct Loans you receive.
    • You will use the 4 digit PIN number that you used to electronically sign your FAFSA.
    • From the MPN website, select "Complete New MPN for Student Loans" from the left side of the screen.
    • On the follow page select Subsidized/Unsubsidized.
    • Follow the instructions provided.
    • LCC will receive electronic confirmation that you have signed your MPN 1-2 days after you have done so.

Before you graduate (or if you drop below half-time attendance), federal regulations require that you complete and Exit Counseling Session.

  • Exit Counseling
    • Tutorial regarding repayment of your Federal Direct Loans.
    • From the Direct Loan Servicing website, select the Entrance and Exit Counseling link at the top of the page.
    • Click Go in the Exit Counseling section.
    • Login to the Direct Loan Servicing Website (you will use the 4 digit PIN number that you used to electronically sign your FAFSA).
    • Follow the instructions provided.
    • LCC will receive electronic confirmation that you have completed the session 1-2 days after you have done so.

If you have questions regarding repayment, please contact Borrower Services:

  • 1-800-848-0979
  • Visit Direct Loan Borrower Services online.
    • View your account.
    • Make payments
    • Deferment information and forms
    • Forebearance information and forms
    • Consolidation information and forms
    • E-Mail Direct Loan Borrower Services staff

A student should be aware of his/her total Federal Financial Aid history:

  • Aggregate Loan Limits are the total amount of outstanding Federal Stafford Loan debt that you may have at any time.
  • View your total Direct Loan history by logging into the National Student Loan Data System.  Click Financial Aid Review and follow the directions to confirm your identity and login.  This system includes all Federal Loans borrowed.

Federal Direct Parent Loan for Undergraduate Students (PLUS)

Review the Federal Direct Loan section above for important information regarding loan types and requirements.

PLUS Loans:

  • Are borrowed by a parent to pay for the educational costs of his/her dependent student.
  • Are based on the parent's credit.  The credit check is conducted by the lender (the U.S. Department of Education).
    • Students whose parent has been denied a PLUS loan based on credit may qualify for additional Federal Direct Unsubsidized Stafford Loans.
    • Parents may choose to get an Endorser (co-signer).
    • If you wish to get an Endorser or appeal the credit decision made, please contact Applicant Services at 1-800-557-7394.
    • Begin repayment sixty days after the first disbursement of the loan.
    • Accrue interest while the student is enrolled half-time.

To apply for a PLUS Loan:

  • Student and parent must complete the FAFSA.
  • Parent and student must complete LCC's Parent Loan Application.
  • Parent must complete a Master Promissory Note (MPN)
    • The agreement between the parent and the Federal Government to repay the Federal Direct Loans received to pay for the son/daughter/s educational costs.
    • The parent will use the 4 digit PIN number that he/she used to electronically sign the FAFSA.
    • From the MPN website, select "Complete new MPN for Parent PLUS Loans" from the left side of teh screen.
    • Follow the instructions provided.
    • LCC will receive electronic confirmation that the parent has signed his/her MPN 1-2 days after the parent has done so.

Private Alternative Loans

Alternative loans are credit-based student loans offered by private lenders.  They are available to students who need  funds in addition to their federal aid to meet educational expenses or for those students not eligible for federal aid.  If you have reached your loan limit for the Stafford Subsidized and Unsubsidized loan programs, but you still need money for your education, the alternative loan can help you.  Additionally, the alternative loan option is beneficial to international students and to those students that are non-degree seeking or may be enrolled for less than halftime, or to dependent students whose parents are not willing to take out a PLUS Loan.

Alternative loans are largely based on the applicant's creditworthiness. As with the PLUS, the borrower may be eligible to borrow the difference between the cost of attendance and financial aid (some lenders may have annual caps on the maximum amount borrowed). Repayment on most of these loans, however, starts six months after the student leaves school. Loan terms vary from lender to lender--each uses its own formula for calculating interest, some lenders charge fees and others do not, and each company has its own definition of creditworthiness The interest rate is generally higher than that of the Stafford Loans, and interest may be capitalized more frequently. Please check with the lender for more information on each loan. Before applying for an alternative loan, please discuss all of your options with a financial aid counselor.

To apply for a loan, go to the lender web site. Students are welcome to investigate other loan sources on their own.

And please keep the following in mind:

  • Variable vs. Fixed Interest Rates
  • Delayed Repayment (in-school deferment) vs. Immediate Repayment
  • Application, Processing, and Disbursement Fees
  • Flexible Repayment Options (after school)
  • Repayment Incentives (interest rate reduction for one-time payments, electronic bill payment, etc.)
  • Consolidation Options

Below is a list of lenders frequently used by LCC students.

 



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