Loans

The U.S. Department of Education's federal student loan program is the William D. Ford Federal Direct Loan Program, commonly referred to as the Direct Loan Program. The U.S. Department of Education is the lender and students apply annually by submitting the FAFSA.

There are four types of Direct Loans:

• Direct Subsidized Loans are available to eligible undergraduate students who demonstrate financial need as determined by the FAFSA. Students need to be enrolled for at least six credits for Direct Subsidized Loan eligibility. The U.S. Department of Education pays the interest while the student is enrolled for at least six credits per semester, during the grace period, and during periods of loan deferment. Principle and interest payment begin six months after the student drops below six credits.
• Direct Unsubsidized Loans are available to eligible graduate and undergraduate students. Students are required to submit a FAFSA, but financial need is not a factor in determining eligibility. Students need to be enrolled for at least six credits for Direct Unsubsidized Loan eligibility. Interest accrues while the student is enrolled, but payment is not required. Principle and interest payments begin six months after the student drops below six credits.
• Parent Loan for Undergraduate Students (PLUS)/Grad PLUS is available to graduate students and parents of dependent undergraduate students. Applicants can borrow up to the student cost of attendance (determined by MSUM) minus any other financial assistance. These loans have a fixed interest rate set annually by the U.S. Department of Education and are not subsidized, meaning that interest accrues while the student is enrolled. Principle and interest payments begin (and are required) once the loan is fully disbursed. Deferments are available upon request. Interest will continue to accrue during the deferment period. Applicants with adverse credit history have the option to obtain an endorser or document to the U.S. Department of Education extenuating circumstances relating to the adverse credit history.
• Direct Consolidation Loans allow borrowers to combine their federal loans into a single loan with a single services.

Undergraduate students may borrow $5,500 to $12,500 per academic year through subsidized and unsubsidized loan programs depending on their year in school.

Graduate students can borrow up to $20,500 per academic year.

Maximum borrowing limits are based on combined borrowing through the subsidized and unsubsidized loan programs.

Note: The Federal Perkins Loan program ended September 30, 2017. Contact ECSI at 1.866.313.3797 for information. Direct payments to: Department of Education, ECSI Federal Perkins Loan Services, P.O. Box 6200-31, Portland, OR 97228-6200

Students are encouraged to complete the FAFSA to determine eligibility for federal and state aid. If federal and state aid are not sufficient to cover the cost of attendance, a private loan is another option. Private loans are non-federal loans made by private entities such as banks, credit unions and state-based or state-affiliated organizations. They are often a more expensive way to borrow then federal student loans. Their terms and conditions are set by each lender. Interest rates can be fixed or variable rates. Co-signers and credit checks are often required. Make sure applicants and cosigners understand the terms of a private loan before pursuing this option.

A link to several private loan programs used by MSUM students in recent years is below. Use this list as a starting point to compare private loan options.

Students who elect to borrow a private loan without submitting the FAFSA forfeit their eligibility to federal need-based and non-need-based aid. A private loan waiver may be required.

Private Loan Programs