• Subsidized Loans
• Unsubsidized Loans
• PLUS Loans
• Loan Eligibility (Federal Loans)
• Loan Eligibility (PLUS Loans)
• Borrowing Limits (Yearly)
• Cumulative Borrowing Caps
• Interest Rates
• Fees and Charges
• Loan Dispersal
• Repayment Options/Plans
• Consolidation
• Payment Deferment

Subsidized Loans

Federal subsidized loans are based on financial need. The Federal government pays the interest during in-school, grace, and deferment periods. Need for subsidized Stafford loans is determined by the Expected Family Contribution (EFC) as determined by the FAFSA data.

Unsubsidized Loans

Federal Unsubsidized Loans are not based on financial need. The federal government does not pay the interest for Federal Unsubsidized Loans. Students may choose to defer interest payments until repayment begins; however, the student is responsible for all interest that has accrued. The accrued interest automatically capitalizes to the loan principal.

PLUS Loans

Federal PLUS Loans are not based on financial need. The federal government does not pay the interest on the Federal PLUS loans. Parents begin repaying the loan, principal and interest, 60 days after the final loan disbursement is made. Interest on the PLUS loans begins to accumulate at the time the first disbursement is made.

Loan Eligibility (Federal Loans)

Below is a list of the factors that affect Federal Loan eligibility:

• Full-time or half-time, enrolled dependent and independent students.
• U.S. citizen or permanent resident
• Enrolled in degree-granting program
• Graduate students enrolled on a provisional admission status*

*Graduate students with provisional admissions status may receive loans for one 12 month period before being granted full admission.

Non-degree seeking and special students are ineligible for the Federal Loan Program.

Loan Eligibility (PLUS Loans)

A parent may borrow on behalf of a dependent undergraduate student who is enrolled full-time or half-time. The parent borrower will be required to pass a credit check. The PLUS Loan program is limited to U.S. citizens and permanent residents. The student must be enrolled in a degree-granting program.

Borrowing Limits (Yearly)

Graduate Students - may borrow up to the total cost of school or a maximum of $20,500 each academic year (of which at least $12,000 will be in unsubsidized loans). Note: the amounts listed are the maximum yearly limits, however a student may not borrow more than the cost of education minus any other financial aid received. The Student Financial Services Office will determine the loan eligibility for each student.

Dependent Undergraduate Student

• $3,500 - Freshman
• $4,500 - Sophomore
• $5,500 - Junior, Senior, or 5th year undergraduate*

Independent Undegraduate Student (or dependent undergraduate student whose parent is unable to borrow a PLUS Loan)

• $7,500 - Sophomore* (of which at least $4,000 will be unsubsidized loans)
• $10,500 - Junior, Senior, or 5th year undergraduate* (of which at least $5,000 will be unsubsidized loans)

** Note: On May 7, 2008 President Bush signed a bill into law allowing undergraduate students to borrow an additional unsubsidized Stafford loan of $2,000 per academic year if the student is eligible.

Parents (PLUS Loans) - The yearly limit on a PLUS Loan is the student's cost of attendance minus any other financial aid received. For example, if the student's cost of attendance is $12,000 and the student is receiving financial aid in the amount of $6,000, the parent could borrow up to $6,000 to apply towards the students education. The Student Financial Services Office will determine the loan eligibility for PLUS loans.

Students Seeking 2nd Bachelor's Degree - Students in the second bachelor's degree program may borrow at undergraduate maximum loan limits (see below).

* Enrolled in a program of study that is at least a full academic year. For periods of undergraduate study that are less than a full academic year, the loan amount a student may borrow will be less than the amounts listed above.

Cumulative Borrowing Caps

The total cumulative subsidized Stafford, unsubsidized loans, and FFEL Program Loan amounts are:

• $31,000 as a dependent undegraduate student
• $57,500 as an independent undergraduate student (with a maximum of $23,000 in subsidized Stafford loans)
• $138,500 as a graduate or professional student (with a maximum of $65,500 in subsidized Stafford loans) Note: graduate debt limit includes outstanding loans from undergraduate programs.

Undergraduate loan limits are up to $23,000 subsidized or unsubsidized for dependent students; $46,000 in combined total for independent students ($23,000 in subsidized + $23,000 in unsubsidized).

Interest Rates

The interest rate for subsidized Stafford Loans is 5.6% for the 2009-2010 academic year and Unsubsidized Stafford Loans is 6.8%. The interest rate for PLUS  loan is 8.5%.

Fees and Charges

The Federal loan program deducts a default fee from each disbursement of 1% for all loans. This fee goes to the federal government to help offset the cost of these loans. Some lenders may charge an additional 1% - 4% fee.

Loan Dispersal

Federal loans are disbursed at the beginning of each term. Students attending only one semester per academic year will have their loans disbursed in one or two disbursements.

Before loans can be disbursed, first-time borrowers at Bay Path College are required to complete the online Entrance Interview Counseling explaining the rights and responsibilities as a loan borrower. Complete this interview at www.mappingyourfuture.org . Additionally, students should complete their Master Promissory Note (MPN) online for their Stafford and/or PLUS loans at www.studentloans.gov. You must complete both the Entrance Interview Counseling and the MPN before the loans can be processed and disbursed.

Repayment Options/Plans

Standard Repayment Plan: Requires fixed monthly payments of at least $50 per month for up to 10 years. The repayment period depends of the loan amount borrowed.

Extended Repayment Plan: Allows for repayment to extended up to 25 years, with monthly payments of at least $50 per month. Only available to borrowers with more than $30,000 in student loan debt whose oldest loan was originated on or after October 7, 1998. You pay more interest over the life of the loan.

Graduated Repayment Plan: This multi-tiered repayment schedule will initially allow you to make lower payments that may be as low as the interest that is accruing for up to 4 years, which may lower your initial monthly payment by as much as 40%. Later, payments increase above the original monthly payment amount so that the loan will still be repaid in 10 years. You pay more interest over the life of the loan. Repayment term is a maximum 10 years.

Income Sensitive Repayment Plan: You choose a monthly payment amount that equals between 4% and 25% of your gross monthly income. You should pay at least the amount of interest accruing each month to ensure the amount you owe does not continue to increase. You may be allowed to use this option for up to 5 years. This option may extend your repayment period, which will result in you paying more interest over the life of the loan. Repayment term is up to 15 years.

Income Based Repayment Plan: Repayment term is up to 25 years. Monthly payments are Capped at no more than 15% of your discretionary income, which is based on your income, family size, and total amount borrowed. After 25 years any remaining debt is discharged. This option may extend the repayment period, which will result in paying more interest over the life of the loan. To qualify for Income-Based Repayment, you must show partial financial hardship.

For more information of repayment options, contact your loan servicer or guarantor agency American Student Assistance at 1-800-999-9080.

Repayment of Federal Loans begins six months after either graduation, when a student leaves school, or drops below half-time enrollment. The length of repayment and monthly payment amounts depends on the outstanding loan balance, the interest rate and repayment policies. Federal Unsubsidized Loan borrowers with deferred interest will have the interest capitalized at the end of the in-school or grace period. A student has only one six month grace period in which to begin repayment of their loans. If a student stops attending for six months or more and then returns to school, the student has already used their grace period and payment on their loans begins immediately after graduation.

Consolidation

Federal Stafford and Unsubsidized Stafford Loans can be consolidated through the Consolidation Loan Program. This consolidation program will allow you to have all your loans held by one servicer and make only one payment on all consolidated loans. If you have questions concerning the Federal Consolidation Loan Program, contact American Student Assistance at 1-866-493-5563 or by e-mail at information@amsa.com.

Payment Deferment

Payments may be deferred if the borrower enters into a deferrable situation and request deferment of payment by submitting appropriate documentation to the loan servicer. Deferrable situations may include, but are not limited to:

• Active duty in the U.S. armed forces*
• Study in an approved graduate fellowship program or in an approved rehabiliation training program for the disabled.
• Unable to find full-time employment (only on pre-July 1, 1993 loans)
• Economic hardship**
• Pursuing half-time study at a postsecondary school

* Contact lender for specific information
** Many Peace Corps volunteers will qualify for a deferment based upon economic hardship.

To defer a loan, simply contact the Office of the Registrar at (812) 535-5269 and request that a verification of enrollment (VOE) be sent to the lender. We participate in the National Clearing House so enrollment information is available electronically to the lenders.