Federal Student Loan Handbook

Federal Student Loan Handbook Undergraduate and Graduate U.S. Students Prepared by: Scholarships and Awards Office Memorial University of Newfoundland With the assistance of the Financial Aid office of UNB (Fredericton Campus) February 2007 Table of Contents ……………………. Preamble 3 Undergraduate Cost Sheet ……………………. Graduate Cost Sheet Applying For a loan ……………………. ……………………. 4 5 7 10 11 Parent PLUS Stafford Loans …….. Graduate PLUS Loan Funding ….. Repaying Your loan ……………………. 12 2 Preamble Welcome to Memorial University!! In Newfoundland and Labrador, a new adventure in learning awaits at a university of 21st century explorers, where the opportunities are as vast as the place itself. Where cutting-edge technology and flexible programs combine to liberate your true potential. Discover a world of unconventional wisdom, and achieve your academic goals, at one of the best-kept secrets in the realm of higher learning. Scholarships, Awards and Financial Aid UC4018, University Centre Memorial University of Newfoundland P.O. Box 4200 St. John’s, NL, Canada A1C 5S7 Tel (709)737-3956/3992 Fax (709)737-8615 Email scholarships@mun.ca Website: http://www.mun.ca/scholarships Judy Casey Manager OPE ID 009500 3 Approximate Costs 2006-2007 Memorial University Undergraduate Full-Time Undergraduate (2 Semesters – 8 Months) Canadian Students International Students Tuition (30 Credit Hours) Accommodations Paton College (dbl room, 19 meals/wk) $2,550 $5,234 $2,546 $93 $292 $80 $1,000 $8,800 $5,234 $2,546 $93 $610 (covers emergency only) $80 $1,000 Burtons Pond (single) ORGANIZATION FEES Student Union Health and Dental Plan Recreation Fee Books and Supplies Approx. Annual For Paton College/Off-Campus: For Paton College/Off-Campus: $9,249 $15,817 Cost For Burtons Pond: For Burtons Pond: $6,561 $13,129 All costs are in Canadian dollars. To discuss payment options Contact the Cashier’s Office: (709)737-8228 cashiers@mun.ca NOTE: Student Aid also allows for one return trip home 4 For Information on the Marine Institute fees, visit www.mi.mun.ca Minimum Expenses for Graduate Students (2006-2007) (CADN$) The University reserves the right to make changes to the regulations, fees and charges. It is the student’s responsibility to be aware of these fees and charges and the applicable deadlines (see University Calendar).The University Calendar and University Diary are available at: www.mun.ca/regoff Memorial University has three semesters per academic year commencing with Fall Semester (Fall: September – December; Winter: January – April; and Spring: May – August) Program Fees Per Semester Citizens of Canada And Permanent Residents $323 $733 $486 $1,010 $7,000 $10,500 $2,000 $911 $683 International Students # of semesters fees must be paid 9 6 9 3 4 3 6 9 12 Graduate Diploma Masters Program – Plan A - Plan B - Plan C Master’s Other: MBA (Executive Option) Master of Oil and Gas Master of Science (Medicine – Applied Health Services Research Doctor of Philosophy (admitted prior to Sept. 1, 2004) (admitted as of Sept. 1, 2004) Special Fees – In addition to Semester Fees above Post-Master of Nursing (Nurse Practitioner Diploma) Master of Education (Information Technology) Master of Nursing (Nurse Practitioner Option) $420 $953 $632 $1,312 $7,000 $10,500 $2,000 $1,183 $887 $12,813 (charged in semester 1) $2,550 (charged half in semester 1, and half in semester 4) $12,813 (charged in semester 4 for students on Plan A and semester 7 for students on Plan B) Students must pay the full program fee. If any program is completed in fewer semesters than the numbers of semesters listed above, a payment of an amount equal to the remaining number of semesters is required (e.g. if 9 semesters are to be paid and the program is completed in 7, the 2 remaining semesters must be paid). Continuance Fees: Students who do not complete their program in the number of semesters listed above will be required to pay a continuance fee for each additional semester required as listed below. Students admitted prior to Sept. 1, 2004 Graduate Diploma candidate: Master’s Candidate: Doctor of Philosophy Candidate: Students admitted as of Sept. 1, 2004 Graduate Diploma candidate: Master’s Candidate: Doctor of Philosophy Candidate: (permanent citizens) $162 $334 $570 $237 $358 $668 (international students) $210 (per semester) $434 (per semester) $ 741 (per semester) $308 $466 $867 (per semester) (per semester) (per semester) 5 Distance Courses and Special Delivery Fees The cost of program courses is included in the program fee. However, there is a charge for distance courses and certain special delivery courses for certain student cohorts. Consult the academic unit of interest to see if a fee is charged. Student Union Fees Graduate Students’ Union - $20 per semester/$60 per year Canadian Federation of Students - $7.48 per semester in fall and winter/ $14.96 per year Recreation Fee (The Works) All students are required to pay a recreation fee of $40 each semester/$120 per year. Dental Coverage (All full–time students) The rate for 2006/2007 payable in each of the Fall, Winter and Spring Semesters is $66.86/$200.58 per year. (Students who already have coverage should complete an Opt Out form by the deadline – www.gsumun.ca) Health Insurance (International Students) International students are required to purchase health insurance. The rate for 2006-2007 is: Single $225.09 per semester $675.25 per year Couple only $450.18 per semester $1350.50 per year Family $675.27 per semester $2,025.75 per year For further information, contact the International Office at (709)737 -8895 or isa@mun.ca Books and Stationary Supplies The cost of books averages $100 per course; the number of courses required varies from program to program. In addition, students will have further miscellaneous expenses in relation to course work and research. Students in programs requiring a thesis are required to pay $20 for the cost of thesis binding at the time of submission for examination. Accommodation (*plus heat and light) On Campus (Burton’s Pond) Single $3850 per year Married $8880 per year Meals Cooking facilities are provided with on-campus accommodations Off campus approximately $2800-$4500 per year Personal Needs Includes clothes, bus/taxi, etc. approximately $3500 per year Settling Allowance – all students For example, cutlery, linen, winter clothing for students from warmer climates - $600-$1200 Application Processing fee A non-refundable fee of $40 Canadian is charged for processing applications for admission Eligible Plan C Programs; students must be full time: Master of Arts, course route only, in: Anthropology (Social/Cultural); Classics; Economics; English Language and Literature; History, Sociology Master of Arts (Philosophy); Master of Arts (Political Science) Master of Applied Science (Environmental Engineering and Applied Science) Master of Education (Information Technology) with Advanced Standing Master of Environmental Science Off Campus $400-$600* per month $400-$600* per month 6 Master of Science (Instrumental Analysis) Master of Social Work US Foreign School Loan Information Applying for a Stafford Loan Step-by-Step Process 1. Complete a FAFSA Before you apply for a Stafford Loan, you must complete the Free Application for Federal Student Aid (FAFSA). The FAFSA determines your eligibility for federal financial aid including Stafford Loans and you must complete it each year you require student loans. Dept. of Education Website: www.fafsa.ed.gov A. After your FAFSA is processed, you will receive a Student Aid Report (SAR). The SAR will not be sent to a foreign school automatically, as it is in the US. You will receive an electronic summary SAR, but YOU are responsible for providing your school with an official 8-page SAR. You must request the 8-page SAR by calling 319-337-5665/ 1-800-4-FEDAID (1-800-433-3243), or it will be mailed to you if you leave your email address off of your application. FAFSA Help line 1-800-433-3243 2. Apply Early Make sure your approval is finalized and preferably arrives at your school prior to the beginning of the semester. 7 3. Complete the Stafford Master Promissory Note (MPN) A. You can obtain a MPN by accessing the following website: http://www.amsa.com/ B. Complete items 1-17. C. Tear off your copy of the MPN. The MPN contains information on your loan terms and responsibilities and must be forwarded to the school for certification. 4. School Certification Your school must have your completed MPN and SAR to certify your loan. School certification forms are downloadable through the following web site: http://www.amsa.com 5. Loan Guarantee After all parts of the application are completed and your eligibility is confirmed, your loan is guaranteed. 6. Loan Disclosure When your loan is guaranteed, your lender sends you a Loan Disclosure Statement with important information, including amount borrowed, interest rates, loan fees and monthly payments. 7. Federal Stafford Loan Maximums Grade Level Stafford Stafford Total Subsidized Unsubsidized Limit Limit 01 3500 4000 7500 02 4500 4000 8500 03 5500 5000 10,500 04 5500 5000 10,500 05 5500 7000 ** 12,500 ** For students who have obtained a baccalaureate degree and are enrolled in coursework necessary for enrollment in a graduate or professional program, the additional 8 unsubsidized loan limit has been increased from $5,000 to $7,000. 8. How to avoid delays Complete all paperwork and respond to requests for information in a timely manner. 9. Plan for your Cheque If you are using an international bank, become familiar with its processes and procedures. 10. Loan Cheque Disbursements Memorial University requests that all cheques be mailed to the school for disbursement. Please cheque with the school to inquire if your cheque has arrived upon your arrival at the school to begin classes. 9 Parent Plus Stafford Loans The federal Parent Plus Loan for Undergraduate Students enables parents and legal guardians with good credit histories to borrow up to the cost of education for dependent undergraduate children who may not be eligible for enough funding to cover their costs. Use it for tuition, room and board, lab expenses, travel (in addition to the Stafford Loan), up to the cost of education. The interest rate is fixed at 8.5%.       PLUS loans are credit-based, not need based, which means that any parent(s) can apply. PLUS loans require no collateral. No penalty for early repayment, and consolidating your loans after graduation is easy! Interest may be tax deductible on your federal tax return. Completion of the FAFSA Financial Aid Application may not be required (but is recommended). Funds are usually disbursed quickly, during the first weeks of the semester. You can apply at: http://www.parentplusloan.com/ 10 Graduate PLUS Loan Funding A new federal loan program, the Federal Graduate PLUS loan is a low interest, federally backed student loan, guaranteed by the US government. Like its undergraduate counterpart, the Grad PLUS Loan can be used to pay for the total cost of education less any aid you’ve already been awarded. Also, like the undergraduate version, eligibility for the Graduate PLUS loan is largely dependent on the borrower’s credit rating and history, as opposed to the purely financial need-based Graduate Stafford Loan.  A Federal Graduate PLUS Loan allows graduate students to borrow the total cost of graduate education including tuition, room and board, supplies, lab expenses, and travel, less any other aid.  These student loans are non-need based. PLUS loans are based on your credit history.  The FAFSA Free Financial Aid Application is required.  Interest is fixed, locked in at 8.5%.  Graduate PLUS loans require no collateral.  Interest may be tax deductible.  Grad PLUS loans can be deferred while you are in school. You can apply at: http://www.gradloans.com/graduate-plus-loan/ 11 US Foreign School Loan Information Repaying your Stafford Loan Step-by-Step Process 1. What you need to know that you owe Now that you are leaving school, it is important that you remind yourself of your rights and responsibilities regarding federal student loans. These loans include: - Subsidized Stafford Loans - Unsubsidized Stafford Loans - Supplemental Loans for Students (SLS – All SLS loans were made prior to 7/1/1994) Your Master Promissory Note (MPN) also contains your Rights and Responsibilities. Your MPN is the binding legal document that you signed to receive your student loans. By signing that note, you indicated your commitment to repay your loans. 2. Stay in touch with your lender You must tell your lender changes to your: a. name, b. address, and c. telephone number You must let your lender know if you: a. Withdraw from school, b. Drop below half-time enrolment c. Transfer to a new school d. Graduate, or e. Have a change in status that would affect your loan status. 12 The most important reason for staying in contact with your lender is if you are having difficulty making your student loan payments, there are options to help: deferment, forbearance, or alternate repayment schedule. 3. Planning for repayment d. Standard Repayment Schedule - Maximum payment period is 10 years (120 monthly payments). Your payment will be set up to pay off your loan in that period. The more you borrow, the higher your payments. - Minimum payment is $50 per month - This is the only payment option your lender/holder is required to offer if your loan was disbursed prior to July 1993. e. Graduated Repayment Schedule -Maximum payment period is 10 years (120 monthly payments). This can be extended annually up to five-year additional years if your payments are less than your monthly interest costs. - Payment start smaller (though they can never be less than the monthly interest accrual) and gradually increase throughout the repayment. - Good alternative if you anticipate your income will increase in the future. - NOTE: You will pay more interest over the life of the loan if you choose a graduated repayment schedule. f. Income-Sensitive Repayment Schedule -Maximum payment period is 10 years 13 - The amount of your payment chances annually based on your expected total monthly gross income. - Your payment cannot be less than the monthly interest accrual. - You can use up to five years of incomesensitive repayment Repaying your Loan (continued) d. Extended Repayment Schedule Only available to borrowers who receive all loans on or after October 7, 1998 and have a balance of more than $30,000 in federal student loan debt. - Maximum payment term is 25 years - Payments can be either fixed of graduated 1) When Payment Begins - Subsidized and unsubsidized Stafford Loans: Enter repayment six months after you cease halftime attendance - Supplemental Loans for students: Enter repayment the day of disbursement, unless deferred until your Stafford Loan enters repayment - Your lender/holder will advise you of your first payment due date while you are in your grace period. If you do not receive this information, it is YOUR responsibility to contact your 14 lender/holder. 2) Solution for Repayment Problems Repaying your loan is a very serious obligation. Remember, you are required to make your student loan payments even if you: - Do not complete your education - Are not employed upon completion of study - Do not find employment in your field of study - Feel that the education your received did not meet your expectations If you are having trouble meeting your scheduled monthly payments, there are options to help: Deferment: A deferment is an entitlement of your loan if you meet the criteria. There are numerous ways to qualify: - At least half-time enrolment at MUN - Graduate fellowship program - Rehabilitation program - Unemployment - Economic Hardship Who pays the interest during deferment? 15 - Subsidized Stafford loans: Federal Government Unsubsidized Stafford loans: YOU Supplemental loan for Students: YOU Forbearance: If you are unable to make your scheduled payments, but do not meet the criteria to qualify for a deferment, the lender/holder may allow you to: - Reduce the amount of your payment, or - Temporarily stop making payments For more information on DEFERMENT or FORBEARANCE, contact your lender! Remember to submit all required documentation and continue to make payments on your account while waiting for notification of approval. What if I have multiple loans and/or lenders? If you are in this situation, there are some options for your that may make repaying your loan easier: Combining loans: - This may be an option for you if you multiple lenders or make the minimum monthly payment on multiple loans. 16 - This may be possible if you have one monthly payment to one lender. In order to combine your loans: - Determine which lender/servicer can best serve you and - Request that lender/servicer purchase your other loans. Federal Consolidation Loan: Through the Federal Consolidation Loan Program, a lender buys all your eligible loans and combines them into a new loan. Consolidation offers both benefits and drawbacks: - Extended repayment of up to 30 years based on your balance - One monthly payment - Fixed interest rate - Extra interest over the life of the loan, if you choose a longer repayment period - Loss of eligibility for certain deferments You must be in your grace period or repayment to apply for a Federal Consolidation Loan. If you are interested in this type of loan, you should contact your lender/servicer to determine if it is in your best interest. If your lender/servicer does not provide Federal Consolidation Loans, they may be able to refer you to a lender who does. Loan Cancellation 17 You are generally obligated to repay your student loan, regardless of what happens. GENERALLY FEDERAL STUDENT LOANS MAY NOT BE DISCHARGED OR CANCELLED DUE TO BANKRUPTCY. However, there are a few situations in which your loan may be discharged. Your loans may be discharged if: - You die, - You are permanently disabled (required certification from a physician and is subject to a conditional review every three years), Teacher Loan Forgiveness – There is a loan discharge/forgiveness program for teachers meeting certain criteria: - First loan was made on/after October 1, 1998 - Teach in qualifying low-income school for 5 consecutive years - Maximum of $5,000 forgiveness - Only Stafford Loans (or portions of a Federal Consolidated Loans that paid off Stafford Loans) qualify. Contact your lender/holder if you think you may be eligible. 18 Loan Repayment Programs There are certain programs that help borrowers repay loans. These include but are not limited to: The AmeriCorps Service Program (www.americorps.org or (800) 942-2677. Delinquency and Default It is very important that you make your loan payments on time. If you are having trouble making your monthly payment, you should immediately contact your lender/holder. If you fail to make your student loan payments for 270 days, your loan will default. The consequences of defaulting on your loan are very serious and may result in: - Damage to your credit rating, - Garnishment of your wages, - Legal action, - Court costs and legal expenses, - Collection charges, - Loss of deferment eligibility, - Referral of your account to a collection agency, - With-holding of your federal Treasury payments (including federal tax refunds, 19 - Social Security benefits, etc) and stateincome tax refunds, Loss of further Title IV financial aid eligibility, and Suspension of your professional license. For more information If you need more information about your federal student loans, visit the National Student Loan Data System (NSLDS) at www.nslds.ed.gov or call them at (800) 4-FED-AID. The Federal Student Aid (FSA) Ombudman works with student loan borrowers informally to resolve loan disputes that the borrower is unable to resolve with the lender/servicer or guarantor. Office of the Ombudsman, Dept. of Education 4th Floor UCP-3/MS 1544, 839 First Street NE Washington, DC 20202 Toll Free phone: (877) 557-2575 http://ombudsman.ed.gov 20 © Copyright retained by the Financial Aid Office of UNB (Fredericton Campus), this document cannot be re-produced without the written permission from the Director of Financial Aid, UNB. Permission has been granted for the reproduction of this handbook. 21