Loans

  

Morgan State University's Financial Aid loan office participates in the William D. Ford Federal Direct Loan Program (usually referred to as the Direct Loan Program). MSU's status as a direct lending institution precludes the University from processing any federal loans from private banks or other lending institutions. The U.S. Department of Education is the lender and will pay the student through the school.

Changes to the Direct Federal Student Loan program beginning July 1, 2012

Interest Rate Change

The interest rate on Subsidized Direct Loans will double from 3.4% to 6.8%.

Graduate and Professional Students Only- Subsidized loan eliminated as of July, 1 2012

Beginning July 1, 2012, all graduate and professional students will lose the interest subsidy on the Subsidized Stafford loan, and will be charged interest immediately. The graduate Stafford loan program will become entirely unsubsidized, which means the loan will accrue interest while a student is in school. These changes will not affect the annual and aggregate borrowing limits. The maximum amount a student can borrow will remain at $20,500 per academic year. Borrower must be enrolled at least part time.

Loss of the "up-front interest rebate fee" affecting Stafford, Grad PLUS and Parent Plus

Currently, there is a 1% origination fee on a Stafford loan and a 4% fee on PLUS loans, but a portion of the fee, .5% for a Stafford and 1.5% for a PLUS, is rebated at the time of disbursement. Beginning July 1, 2012, the full fee will be charged.

Loss of interest rate reduction

The last change is the loss of the .25% interest rate reduction if you do not pay your loans electronically while in repayment.

 Please keep in mind students who are applying for a federal education loan for the first -time must have a valid PIN number in order to sign the Master Promissory Note (MPN) and /or Entrance Counseling Interview. The links to the sites above are listed below;

· Apply for PIN

· Master Promissory Note

· Entrance Counseling

Students are required to complete Exit Counseling before they withdraw, graduate, or drop below half-time attendance (even if you plan to transfer to another school). The exit counseling will help you understand your rights and responsibilities, in addition to provide useful tips and information to help you manage your loans as a student loan borrower.  The link to complete exit counseling locate below.

Exit Counseling

Debt Management

When you apply for student financial aid, you will receive an offer of a long-term, low-interest educational loan.  

The Federal Direct Loans offered include;

  • Federal Direct Subsidized Loan
  • Federal Direct Unsubsidized Loan (interest accrues)
  • Federal Direct PLUS (Parent Loan for Undergraduate Student)
  • Federal Direct Grad PLUS (For Graduate Students)

However, we also offer Alternative Loans through banks and lending institutions for those students and parents who may have additional need for a loan outside of the Direct Federal Lending Program.

Annual Loan Limits

  Direct Subsidized Loans are for undergraduate students only effective July 1, 2012.

Annual Loan Limits for Undergraduate Students

Year

Dependent Undergraduate Student (except students whose parents are unable to obtain PLUS Loans)

Independent Undergraduate Student (and dependent students whose parents are unable to obtain PLUS Loans)

First Year

$5,500-No more than $3,500 of this amount may be in subsidized loans.

$9,500-No more than $3,500 of this amount may be in subsidized loans.

Second Year

$6,500-No more than $4,500 of this amount may be in subsidized loans.

$10,500-No more than $4,500 of this amount may be in subsidized loans.

Third and Beyond (each year)

$7,500-No more than $5,500 of this amount may be in subsidized loans.

$12,500-No more than $5,500 of this amount may be in subsidized loans.

Maximum Total Debt from Stafford Loans When You Graduate (aggregate loan limits)

$31,000-No more than $23,000 of this amount may be in subsidized loans.

$57,500-No more than $23,000 of this amount may be in subsidized loans.

Annual Loan Limits for Graduate / Professional Students

Loans for loan periods beginning

before July 1,2012

Loans for loan periods beginning

After July 1,2012

Subsidized Loan Maximum

Unsubsidized Maximum

Subsidized Loan Maximum

Unsubsidized Maximum

All Graduate and Professional Students

$8,500.00

$20,500, less any subsidized loan amount received

$0

$20,500