RETURNING STUDENTS 2010-2011

Important Loan Information and Documents to Complete

Federal Direct Stafford Loans e-MPN (Subsidized and Unsubsidized) and the Entrance Interview-
This loan may be subsidized, unsubsidized, or a combination of both. With a subsidized loan, which is awarded based on financial need; the federal government pays interest that accrues while you are in school. The unsubsidized loan is not based on need; interest that accrues while in school must either be paid monthly or deferred and capitalized (added to the original loan balance). Financial need is determined by the Office of Financial Aid.

Loan funds are disbursed directly to Paul Smith's College in equal amounts over each term of enrollment for the academic year. There is a 6-month grace period prior to repayment following graduation, withdrawal, or a drop below half-time status.

**Due to the recent changes in the Federal Direct Stafford Loans all returning students must complete a new Federal Direct Stafford Loan MPN.  The Stafford Loan MPN can be completed at www.dlenote.ed.gov.   Deadline is July 31, 2010.

Federal Direct Subsidized Stafford Loan
A subsidized loan is based on financial need. The federal government will pay the interest on the loan while you are enrolled in school at least half-time and through the grace period.  If you do not want to borrow the entire amount printed on the financial aid award letter, you may indicate a lesser amount by crossing out the original amount awarded and indicating what amount you would like. A signed copy of the financial aid award letter is required to activate this loan.

Federal Direct Unsubsidized Stafford Loan
An unsubsidized loan is not based on financial need. You can either pay the interest monthly/quarterly, or have the interest capitalized (added to the principal loan amount). Loans issued after July 1, 2007, are fixed at 6.8%. Repayment on the principal and interest must begin six months after the student graduates, leaves school, or drops below half-time enrollment. If you do not want to borrow the entire amount printed on the financial aid award letter, you may indicate a lesser amount by crossing out the original amount awarded and indicating what amount you would like. A signed copy of the financial aid award letter is required to activate this loan.

Federal Direct Parent PLUS Loan
The federally sponsored PLUS loan is a low-interest student loan for graduate level students and the parents of dependent undergraduate students, who are attending at least half-time. The interest rate is a fixed 7.9%. There is a 2.5% net fee (4% origination fee less an upfront rebate of 1.5% that assumes 12 on-time monthly payments) deducted from each disbursement of a PLUS Loan. Loan funds are disbursed directly to Paul Smith's in equal amounts over each term of enrollment for the academic year. The maximum amount that can be borrowed is the cost of education less any other forms of financial aid. PLUS loans must be processed according to federal regulations, which stipulate that a loan cannot be processed after the end of the loan period. Thus, you cannot use a federal PLUS loan to pay a back balance.

As a Federal Direct borrower you have three repayment options to choose from:

1. Immediate repayment once loan if fully disbursed
2. Interest payments only
3. Full loan (principle and accruing interest) in deferment while the student is in school for up to 4 years.

To download an application or for additional information on the Parent PLUS Loan, visit the PLUS Loans page. Remember to send a valid copy of your driver’s license and/or passport for signature validation.

Federal Perkins Loan
The Federal Perkins Master Promissory Note (MPN) is completed only once to cover all Federal Perkins Loans you will receive at Paul Smith’s. You sign one note, which is good for up to ten years of study. If you do not want to borrow the entire amount printed on the financial aid award letter, you may indicate a lesser amount by crossing out the original amount awarded and indicating what amount you would like. A signed copy of the financial aid award letter is required to activate this loan. For Perkins Loans, there is a 9-month grace period prior to repayment following graduation, withdrawal, or a drop below half-time status. The current Federal Perkins interest rate is 5%.