Student Loans


Student loans are playing an increasingly significant role in financing post-secondary education. Because of the favorable terms and conditions of educational loans, you should not be afraid to borrow as an investment in your future. On the other hand, loans represent debts that must be repaid, and failure to repay can result in substantial penalties. The federal government has expanded the limits on these vital loan programs to assure that students will have access to and a choice among educational institutions.

The Federal Perkins Loan (formerly National Direct Student Loan) is a federal loan for undergraduate and graduate students enrolled for at least six credit hours at Ohio University. Repayment and interest accrual begins nine months after you graduate, leave school, or drop below halftime enrollment as defined by the university. The interest rate is currently five percent, and loans can be included under the loan consolidation provisions contained in the Reauthorization Act of 1992. You must sign a promissory note before your account can be credited or a check disbursed.

The William D. Ford Federal Loan is a federal loan for undergraduate and graduate students enrolled at least halftime in a certificate or degree-granting program at a participating post-secondary institution. ALL APPLICANTS FOR THE WILLIAM D. FORD FEDERAL LOAN MUST FILE A FREE APPLICATION FOR FEDERAL STUDENT AID (FAFSA) TO DETERMINE ELIGIBILITY.

The Federal Direct Subsidized Student Loan maximum for graduate students is $8,500 per academic year. To qualify for the Subsidized Federal Direct Student Loan, you must demonstrate an unmet need after other types of assistance such as the following: (1) tuition scholarships, (2) fellowships, (3) research and teaching associateships, and (4) graduate research associateships have been considered. You must obtain specific information, requirements, and procedures from the appropriate academic departments.

Eligibility for the Federal Direct Subsidized Student Loan is determined by the Federal Methodology need analysis on the FAFSA and must not exceed the difference between the cost of education (budget) minus the expected family contribution and other aid estimated to be made available. If you do not qualify for the maximum Direct Subsidized Student Loan, you may apply for the Direct Unsubsidized Loan (interest is not subsidized while in school). You are responsible for the interest, and if you elect not to pay the interest while attending school it will accrue on the loan principal. Borrowers will have a variable interest rate. Interest rates are tied to 91-day Treasury bills plus 3.1 percent.

If eligible, you may borrow up to $10,000 in additional Direct Unsubsidized Loans. The interest rate is variable. All loan proceeds are disbursed in equal installments by term and are mailed to your local address.

Loan repayment may be deferred for certain conditions, and loan consolidation is possible under the Reauthorization Act. All first-time borrowers at Ohio University must attend an entrance interview before receiving their first disbursements.

Ohio University Loans
are institutional funds made available to students on a temporary basis to provide cash while waiting for disbursement of financial aid or earnings from employment. You must complete a one-page loan application and have it approved before a loan check is issued. If you are in default on previous loans and/or federal loans, you are not eligible to receive an institutional loan. Borrowers who are not aid recipients are charged a $4 processing fee and an interest rate of 9 percent. You must have a guaranteed source of repayment within either 30 or 60 days from the time the loan is issued.



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University Publications and the Computer Services Center revised this file ( https://www.ohio.edu/~gcat/95-97/finance/loans.html ) April 13, 1998.

Please e-mail comments or suggestions to " gcat@www.ohiou.edu ."

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