Federal Stafford Loans

Information regarding processing changes affecting all Federal Direct Stafford Loans for Undergraduate Students starting for the 2010-2011 academic year (summer/fall/spring)

As you may have heard, effective July 1st, 2010, Paul Smith’s College is changing the way we process Federal Student Loans beginning with the 2010-2011 academic year.  The Financial Aid Office has put together this brief letter to provide you with a better understanding of the new loan process. 

Why the change?

Economic issues, including the recent sub prime lending crisis, coupled with regulatory changes to the student loan industry have all contributed to our decision to exit the Federal Family Educational Loan Program.  After careful consideration and review of these issues and changes, the College concluded that a change to the Direct Loan program would be more beneficial to students. 

How does this affect you?

If you are or were a borrower of a Federal Stafford Loan or your parent borrowed a Federal PLUS Loan, these loans were borrowed from a bank or credit union. These loans will now be borrowed directly from the federal government through the William D. Ford Federal Direct Loan Program.  Information on how to apply is available on our website.

What are the benefits of the Direct Loan Program?

          *Consistent access to loan funds directly from the U.S. Department of Education
          *Competitive rates and repayment options available to all borrowers
          *Simple application process
          *Quick receipt of funds
          *Excellent customer service

What happens next?

If you filed a FAFSA, your 2010-2011 award letter may include an offer for a Federal Direct Stafford Loan

What do I have to do?

To accept funds from this program, you are required to complete a Master Promissory Note and the Entrance Counseling Checklist. Information on these two processes is provided, www.studentloans.gov