Must be repaid
Money borrowed from a financial institution, the Federal Goverment, or the university to pay for college expenses.
To be considered, students must request loan funds via the FAFSA.
Students must complete a master promissory note for all loans before funds are credited to their account.
Federal Perkins Loans: These limited loans are awarded through the university at an interest rate of 5 percent. Repayment begins nine months after graduation or when the student drops below half-time status.To be considered for a Federal Perkins Loan, students must file the FAFSA by March 10 of each year.
Federal Direct Loan Program: These loans are low interest loans available to students enrolled at least half time. The interest rate is fixed. Interest is paid by the government on federally subsidized (need-based) loans. Interest will be charged beginning when the loan is disbursed on unsubsidized (non-need-based) loans. Repayment begins six months after graduation or when the student drops below half-time status.
If you accept a Federal Direct Loan, you will not be borrowing from a bank. Direct Loans are loans made with federal capital and owned by the federal government. Loan repayments are made to the government, and Direct Loans are never sold.
There are two types of Direct Loans available to students—subsidized and unsubsidized.
Subsidized loans are federal loans which the government pays the interest on while the student maintains at least half-time enrollment.
If a student receives an unsubsidized loan, he or she is expected to pay the interest while enrolled in school or have it capitalized. Unsubsidized loans can replace expected family contribution.
The Office of Financial Aid administers the loans; determines your loan eligibility; approves the loan; confirms the promissory note, when necessary; receives the funds from the federal government; and credits the loan amount directly to your University student account.
Please note: Because IU South Bend participates in the Direct Loan program; we do NOT process Subsidized, Unsubsidized Stafford Loans or PLUS Loans through private lenders.
Federal Parent Loans for Undergraduate Student (PLUS): The PLUS program provides an opportunity for parents of dependent undergraduate students to borrow through the Direct Loan program. The maximum interest rate for a PLUS loan is 7.9 percent and repayment begins within 60 days of disbursement of the loan.
Beginning with the Fall 2013 term, Parent PLUS loan applications may only be submitted electronically. Parents will need to complete the form at StudentLoans.gov by using the SIGN IN button and following these additional steps.
- Request a Direct PLUS Loan,
- Select Parent Plus at the bottom of the page,
- Complete the application, and
- Submit the application.
Limited Emergency Loan funds are available each year. Because our dollars are very limited, students are asked to complete the Emergency Loan Application and then make an appointment with the Office of Financial Aid and Scholarships to discuss available options. Call 574-520-4357 to schedule an appointment.
Private Alternative Loans
Private student loans are offered by private lending institutions as an alternative aid option if additional funding is needed to supplement your state and federal aid. Before you consider borrowing a private student loan, we recommend you apply for federal student loans, which generally have better terms and lower interest rates.
You should consider a number of factors before applying for a private student loan. For your convenience we have listed several of those factors below:
Private student loans are usually higher interest rate loans with interest that accrues while the student is in school.
Students must have a good credit history to obtain private student loans. You may need a credit worthy co-borrower to receive a private student loan.
The lenders interest rate on your private student loan is variable and dependent upon your credit history, and if applicable, your co-borrower’s credit history.
If You Need to Select a Lender
You have the right to select any lender you wish for a private loan. Lenders offer different terms and conditions, which you can find by searching the internet. IU South Bend is not endorsing or promoting any lender, but providing a list of those that IU South Bend students have borrowed from in the past.
Students should make an appointment with a Financial Aid Administrator before applying for an alternative loan.