Undergraduate Loan & Financing Options
These include both federally and University-funded loans for students, as well as loans for parents, and a number of private, alternative loan options that can help families manage the cost of a university education.
By examining the different features of each type of loan, you can determine which might best suit your requirements.
You should also review and consider all of the different opportunities for grants and scholarships, and student employment.
Loans are available to undergraduate students enrolled at least half time in a degree or certificate program. The Federal Direct Loan program enables students to borrow from, and repay loans directly to, the U.S. Department of Education through its servicing centers.
There are two types of Federal Direct Loans: subsidized and unsubsidized. Subsidized loan amounts are based on federal financial need, grade level, and cost of attendance. The federal government pays the interest on a subsidized student loan during: in-school status, authorized deferment periods, and, the grace period. The student is responsible for paying the interest on an unsubsidized student loan during all periods. During this time, students may either pay the accumulating interest or capitalize the interest. Capitalization means the unpaid interest is added to the principal balance of the loan.
Interest rates for Federal Direct Subsidized and Unsubsidized Loans for undergraduates during 2020-2021 is a fixed 2.75%. For loans with a first disbursement between 10/01/20-09/30/21, there is a 1.057% origination fee deducted from the proceeds of the loan. Loan funds are disbursed directly to Suffolk University in equal amounts over each term of enrollment for the academic year. First time borrowers must complete a Master Promissory Note (MPN) in order for the loan to be disbursed. There is a six-month grace period prior to repayment following graduation, withdrawal, or a drop below half-time status.
Maximum Annual Loan Limits
|Grade Level||Dependent Student||Independent Student|
|Sub* + Unsub = Total||Sub* + Unsub = Total|
|Freshman||$3,500 + $2,000 = $5,500||$3,500 + $6,000 = $9,500|
|Sophomore||$4,500 + $2,000 = $6,500||$4,500 + $6,000 = $10,500|
|Junior||$5,500 + $2,000 = $7,500||$5,500 + $7,000 = $12,500|
|Senior||$5,500 + $2,000 = $7,500||$5,500 + $7,000 = $12,500|
*The subsidized amounts listed above are awarded based on financial need. If the student does not have financial need, this amount will be replaced with an unsubsidized loan. The minimum amount we will process in a Direct Subsidized Loan is $200.
Maximum Aggregate Loan Limits
Dependent Undergraduate: $31,000 - with a subsidized maximum of $23,000
Independent Undergraduate: $57,5000 - with a subsidized maximum of $23,000
Deferment, Repayment, and Consolidation
Federal Direct Loan borrowers can visit the Department of Education’s Direct Loans Online site for general account information, repayment options, and monthly payment calculators, as well as downloadable deferment forms. This site also links to the Direct Loan Consolidation and National Student Loan Data System (NSLDS) websites.
To access most of the above features, you will need to use your FSA ID. You can create or manage your FSA ID here.
Remember, it is the student’s responsibility to obtain all deferment information and file the required forms with the appropriate office or agency.
Entrance/Exit Counseling for Direct Loan Borrower
The Office of Financial Aid is required by law to provide Entrance and Exit Loan Counseling for Federal Direct Loan borrowers. If you are a new borrower, entrance counseling must be completed before loan proceeds can be credited to your tuition account. If you withdraw from the University, take a leave of absence, or graduate, you must complete exit counseling. Entrance and exit counseling are conducted at the Office of Financial Aid. You may also complete either your entrance or exit counseling online.
The Federal Direct PLUS Loan program enables parents of dependent undergraduate students to borrow from, and repay loans directly to the U.S. Department of Education through its servicing centers. PLUS Loans offer a fixed interest rate, which for 2020-2021 is 5.3%. There is a 4.228% origination fee automatically deducted from the loan amount prior to disbursement. This fee changes every Oct 1st. Parents may borrow up to the cost of attendance less financial aid received. Repayment begins 60 days after the loan is fully disbursed.
Parents can choose to defer payments on a PLUS loan until 6 months after the date the student ceases to be enrolled at least half time. The interest that accrues on the loan while it is in deferment can either be paid by the parent borrower monthly or quarterly, or can be capitalized quarterly. A deferment can be requested as part of the online application process.
If a parent is denied a Federal PLUS loan due to credit reasons, the parent may appeal the denial or have a credit worthy person cosign/endorse the loan. If a parent is approved by appeal or with an endorser, he/she is required to complete on-line credit counseling through StudentLoans.gov. However, on-line credit counseling is encouraged for all PLUS borrowers.
If the parent is denied and does not wish to appeal or seek and endorser, the dependent student may receive additional unsubsidized loan funding. The maximum eligibility is $4,000 for freshman/sophomore class levels, and $5,000 for junior/senior class levels.
Financing Your Education
At Suffolk University we understand that financing a college education is likely to be one of the most significant investments you and your family will make. Students who wish to borrow funds through an alternative loan program are able to borrow up to the cost of attendance, minus any other financial aid. While Suffolk University does not recommend a particular alternative loan program and will certify any loan for which a student meets the eligibility criteria, we encourage you to consider the information below to assist you in choosing the best program for your individual needs.
Alternative Educational Loans
Once you have successfully exhausted all other funding options, such as federal loans, and are still in need of additional financing, you may want to consider a private student loan. Alternative loans are to be used as supplements to cover the remaining balance AFTER financial aid awards and federal loans.
Alternative student loans are credit-based loans offered through private lenders or banks. These loans have certain eligibility criteria, primarily, a credit-worthy borrower with verified income is necessary. However, some loans carry additional eligibility requirements, so be sure to check all requirements thoroughly with your lender before choosing a loan product that’s right for you.
There are many alternative loan options available and selecting the best one for you can be overwhelming. First, review the information below before submitting an application to a private lender.
Important Things to Consider When Applying for an Alternative Educational Loan
1. Exhaust all other forms of aid prior to borrowing an alternative loan.
- Complete the FAFSA to be considered for federal aid, including Federal Direct loans.
- Take advantage of payment plans offered by the University. Suffolk offers a monthly payment plan which allows you to spread out your costs for a small fee. Families who utilize the payment plan, even for a portion of their balance, often borrow less than those who do not and save hundreds of dollars in interest fees over time.
- Consider a Parent PLUS loan.
2. Determine the amount of your alternative loan.
- Plan for fall and spring semester costs.
- Borrow only the amount you actually need to cover your educational related expenses.
- Keep in mind you may be able to significantly reduce your borrowing by covering yearly costs with a combination of sources: savings, present income, payment plans, and federal loans.
3. When choosing a lender:
- Understand fixed vs. variable interest rates: Fixed interest rates will not change during the entire life of the loan. Although they may be slightly higher than some variable rates now, they do not fluctuate with the market. Variable rates could rise significantly during the loan term, which could lead to higher monthly payments. Choosing a loan with a low variable rate over a loan with a fixed rate is best for a student who plans to pay off the principle of the loan in a short period of time.
- Take into consideration the total “price” of a loan: The interest rate is not the only factor for loan price comparison; look at the Annual Percentage Rate, as well as any fees associated with the loan. For example, a loan with a lower interest rate might seem more favorable, but high fees on the lower rate means it might actually be more expensive overall. Understanding these factors will provide you with a better understanding of the total loan costs and enable you to make the best decision.
- Review deferred payment vs. immediate repayment options: Some lenders require immediate repayment on their alternative loans. These monthly payments, however, can be as low as $25 a month and make a significant difference in the overall “price” of the loan. Even if the loan you choose offers deferred payments, making small payments while in school will help lower accrued interest and can make a dramatic difference in the length of time it takes to repay the loan.
- Decide who should be the borrower: In the current credit climate a credit-worthy co-signer is almost always required for an application to be approved. In most cases, using the parent as the primary borrower and the student as the co-signer results in lower interest rates and better loan terms. Even students with a credit history are encouraged to apply with a credit-worthy co-signer, if possible, since it could reduce interest rates significantly and save hundreds of dollars over the life of the loan.
- Understand loan eligibility requirements: Most lenders require a credit-worthy borrower with income verification for approval. However, some loan products have additional eligibility requirements that may include: satisfactory academic progress, minimum enrollment status (at least half time enrollment), and type of degree program. Before applying, make sure you meet all eligibility requirements.
Suffolk University has compiled a list of alternative loan options. Students are not required to select one of these lenders. Suffolk University will process any alternative loan application submitted by the borrower provided all eligibility requirements are met. Your local bank or credit union is another source to consider when choosing a private loan program. We encourage you to compare all programs before selecting the best option for you.
New Requirements for Alternative Loans
As of February 14, 2010, federal regulations were implemented which require lenders to provide more in-depth information on alternative student loans, interest rates, and repayment options. As part of “the Higher Education Opportunity Act,” Title X is specifically aimed at private lenders and established new regulations that affect the way you receive, and are approved for, private student loans. Listed below are some of these new requirements:
Self Certification Form: As part of the loan application process, student borrowers are now required to complete and return to their lender a self-certification form for each loan application submitted to the Office of Student Financial Services. An approved borrower must fill out a self-certification form (usually provided by the lender) and will be required to provide information on “cost of attendance” and “estimated financial aid.” Obtain a self-certification form. To avoid unnecessary delays, be sure to return this form to your lender and not to the Office of Student Financial Services.
Loan Approval Disclosure: Once your loan is approved, your lender will provide you with a statement that includes your interest rate, loan details and repayment options. Student borrowers are now required to “actively accept” the terms of their loan within 30 calendar days before their school will be notified that school certification is available. The lender’s terms for how to “accept” the loan terms can be found on this disclosure statement.
Right to Cancel: Borrowers and/or cosigners have the right to cancel or rescind a loan offer within three business days after receipt of the Final Disclosure. During this time, the lender cannot disburse loan funds. Be aware the cancellation period cannot be waived in order for funds to disburse more quickly. This may delay the disbursement of loan funds to your student account, so be sure to take it into consideration when estimating the timeline for bill deadlines.
The Office of Student Financial Services will not certify a student’s alternative loan until all required lender documentation is complete. If you have questions regarding the status of your loan applications, please contact your lender.
Suffolk University is committed to the highest standards of professional conduct and ethical behavior. Ensuring the integrity of the student financial aid process and programs is critical to providing equity and access to higher education. With the Reauthorization of the Higher Education Act of 1965, Congress required that all colleges post a Code of Conduct relating to financial aid, private lending and student choice. Hence, the staff in the Office of Student Financial Services herein confirms that we adhere to the following sound practices:
I. University employees do not receive any personal benefits from Lending Institutions. No member of the Student Financial Services staff will accept anything of more than a nominal value on his or her behalf of another person or entity from any Lending Institution. For example, cash, stocks, gifts, entertainment, expense-paid trips, etc, will never be accepted from a Lending Institution. Likewise, an individual will never accept payment or reimbursement from a Lending Institution for lodging, meals or travel to conferences or training seminars.
II. The University does not provide any advantage to a Lending Institution. The Staff in the Student Financial Services does not accept anything of value from any Lending Institution in exchange for any advantage or consideration provided to the Lending Institution related to its student loan activities, including, but not limited to revenue-sharing, printing costs or below-cost computer hardware or software. Likewise, the university does not allow any Lending Institution to staff the Student Financial Services Office or the Student Services calling center at any time.
III. The University makes appropriate use of any “Suggested Lender Lists”.The selection of the Lending Institutions for inclusion on the private/alternative loans Suggested Lender List is based solely on the best interests of the university students and their parents without regard to the financial interests of the university. We abide by the following:
- Students and their parents are free to select the Lending Institution of their choice for private/alternative loans and will suffer no penalty imposed by the university from using a Lending Institution that is not a “Suggested Lender”.
- Students and their parents are not required to use any of the university private/alternative loan “Suggested Lenders” and may borrow through any lender or guarantor they choose.
- The university does not assign a borrower’s loan to a particular lender and will certify all loans based on a borrower’s selection of a lender.
IV. University employees do not serve on lender advisory boards for remuneration. No officer, trustee or employee of the university who makes financial aid decisions for the university or who is employed in, supervises or otherwise has responsibility or authority over the university Office of Student Financial Services will receive any remuneration for serving as a member or participant on a student loan advisory board of a Lending Institution, or receive any reimbursement of expenses for such service.