Effective Date: January 1, 2003
Last Reviewed: January 1, 2003
Stonehill College maintains multiple sources and programs for funding Financial Aid Awards and Loans. All Financial Aid Awards and Loans are subject to certain conditions.
PROCEDURE:
1. The William D. Ford Federal Direct Student Loan (FDSL) provides funding to help students pay some of their own college costs. The loan is made to the student, and the student is responsible for repayment. Eligibility is contingent upon completion of appropriate application documents. The Direct Loan carries a variable interest rate, set annually and capped at 8.25. Repayment of principal begins six months after the student ceases to be a student on at least a half-time basis. The FAFSA (Free Application for
2. Federal Student Aid) is the annual application. There are two types of Direct Loan. If the student demonstrates the requisite need, the student qualifies for the Subsidized Direct Student Loan. The federal government pays the interest on this loan while the student remains at least a half-time student. If the student does not qualify for the full Subsidized Direct Student Loan, they may borrow an Unsubsidized Direct Student Loan. The student must pay the interest on this loan while in school; or they may opt to capitalize the interest and pay it, along with the principal, upon leaving school. The amount of a student loan depends on the number of courses successfully completed. If the student has successfully completed fewer than 10 courses, they may borrow up to $2,625 per year. If the student has successfully completed between 10 and 19 courses, they may borrow up to $3,500 per year. Once the student has successfully completed 20 courses, they may borrow up to $5,500 per year. The federal government deducts 1.5% in fees from the gross loan amount before forwarding the balance, half in each semester, to the College. Direct Loan eligibility is awarded by the College only. To apply for and receive such a loan, the student must submit a Master Promissory Note to the College. If an incoming student whose file is complete, the student will receive this Note from the College Loan Office during the summer. If a returning student who is a first-time borrower, a Note has been enclosed with the Financial Aid Letter. If a returning student who has borrowed before, the student has already completed a Master Promissory Note and is not required to complete another during enrollment at Stonehill.
3. Once the student has submitted a Master Promissory Note to the College, a Federal Direct Student Loan will automatically be processed for each subsequent year in which the student files a FAFSA (Free Application for Federal Student Aid) or Renewal FAFSA unless the student specifically requests otherwise. If the student does not wish to borrow in any given year, they must cross the Loan off the Financial Aid Letter before signing it and returning it to the Student Aid and Finance Office. As a participant in the Federal Direct Student Loan Program, Stonehill College cannot accept bank-issued Stafford Loan Promissory Notes. The 2 student must obtain the promissory note from Stonehill and return it directly to Stonehill. After a completed promissory note has been received and approved by the College, the net amount of the loan will be credited to the student’s account, half in each semester.
4. The Federal Perkins Loan is a low-interest (5%) loan funded by the federal government and administered by the College. The FAFSA is the primary application for the Perkins Loan. Eligibility, based on financial need and availability of funds, is finalized by the verification of the student’s financial aid application. Repayment of principal and interest is made directly to the College and begins nine months after the student ceases to be at least a half-time student. Minimum repayment is $40 per month. The student will be required to sign a Perkins Loan promissory note with the Associate Director for Loans during the academic year. Loan proceeds will be credited, as available, to the tuition account after the financial aid application has been verified. Because of the College’s concern for student debt levels, a Perkins Loan is used to supplement the Federal Direct Student Loan. Except in extreme situations, total student borrowing in any given year is limited to a maximum of $5,500. Once the student’s Direct Loan reaches this level, it is unlikely that they will be awarded a Perkins Loan as well. At Stonehill College, the Perkins Loan is considered a secondary loan source. Therefore, a Perkins Loan will be canceled if the student declines their Direct Loan.
5. The Massachusetts No-interest Loan (NIL) uses limited funds provided by the Commonwealth of Massachusetts and is awarded by the College to students who meet strict state eligibility criteria. Interest-free throughout the life of the loan, repayment does not begin until six months after the student ceases to be enrolled in school at least halftime. The student will be required to sign a promissory note with the Associate Director for Loans during the academic year. Loan proceeds will be credited to the tuition account after the financial aid application has been verified. Because of the College’s concern for student debt levels, the NIL is used to supplement the Federal Direct Student Loan. Except in extreme situations, total borrowing in any given year is limited to a maximum of $5,500. Once the student’s Direct Loan reaches this level, it is unlikely that the student will be awarded a NIL as well. At Stonehill College, the No-Interest Loan is considered a secondary loan source. Therefore, a NIL will be canceled if the student declines their Direct Loan.
6. The Stonehill (GATE) Loan – supplemental loan funding offered by the College. This loan offers competitive interest rates, fees, and repayment terms. Interest rates and loan fees vary, depending upon whether or not the student borrower has a co-signer and, if so, the strength of that co-signer’s credit. The best terms are offered to borrowers with the most credit-worthy co-signers. Like the unsubsidized Federal Direct Student Loan (see p. 6), interest accrues during school enrollment, but can be capitalized and paid with the principal. Repayment does not begin until the student has left the College, and there is a deferment provision for graduate school. Further information regarding the terms and application process for this loan will be provided by the Associate Director for Loans. Since the Stonehill Loan is a secondary loan source, offered in 3 conjunction with a Federal Direct Student Loan, it will be canceled if the student declines the Direct Loan. In addition, because the terms of the Stonehill Loan are similar to most alternative student loans, if the student plans to borrow through an alternative student loan source, the Stonehill GATE Loan will be canceled by the College and the student should therefore increase that other alternative student loan by the amount of the canceled GATE.