Loan FAQs
Here is a list of FAQs related to Direct Loans and PLUS LoansParent Loans for Undergraduate Students (PLUS) are federal loans available to parents of dependent undergraduate students to help finance the child's education. Parents may borrow up to the full cost of their children's education less the amount of any other financial aid received. PLUS Loans may be used to pay the EFC. There is a minimal credit check required for the PLUS loan, so a good credit history is required. Students are advised to check with their local bank to see if they participate in the PLUS loan program. If the application for a PLUS loan is turned down, the student may be eligible to borrow additional money under the Unsubsidized Stafford Loan program..
Direct Loan FAQs
What are the benefits of the Direct Loan program?
What do I have to do to get my loan funds?
Can I go ahead and complete the loan counseling now?
If I borrowed through a private bank last year, will I have to pay two different lenders now?
Where can I find information about deferments or forbearance requests?
Where do I find information about Federal Loan Consolidation?
What is required when I leave UNT?
PLUS FAQs
How do my parents apply for a loan?
I borrowed a PLUS loan at UNT last year. What do I have to do this year to get another PLUS loan?
What if my parent is not eligible for federal Direct PLUS loan?
What is a Federal Direct PLUS for Graduate Student Loan?
Where can I get additional information?
Direct Loan FAQs
What are the benefits of the Direct Loan Program?
Several of the benefits are:
- A guaranteed source of funding for student loans.
- The option of an incomeIncome is the amount of money received from employment (salary, wages, tips), profit from financial instruments (interest, dividends, capital gains), or other sources (welfare, disability, child support, taxable Social Security, and pensions).-contingent repayment plan or an income-based repayment plan when a student enters repayment. This means a borrowerThe person who receives a loan. has the option of ensuring that the loan repayment amount will always be affordable based on what an income will allow.
- Students in the Federal Direct Loan Program who enter into public service jobs can have any remaining balance on loans forgiven after 10 years of repayment while in public service work. (While this option does not exist in the FFEL Program, students who borrowed in that program can consolidate their loans to the Direct Loan Program in order to take advantage of this forgiveness).
- The Federal Direct PLUS loan origination feeThe origination fee is paid to the bank to compensate them for the cost of administering the loan. The origination fees are charged as the loan is disbursed, and typically run to 3% of the amount disbursed. A portion of this fee is paid to federal government to offset the administrative costs of the loan. is lower, with an interest rate for Parent and gradPLUS loans of 7.9% compared to 8.5% in the lender-based FFEL Program.
What do I have to do to get my loan funds?
You will have to complete a FAFSA for Direct Loan eligibility. Monitor myUNT To Do List for updates and requirements. Once your file is considered complete, you will be notified about your award(s) that you must Accept or Decline via myUNT.
First-time student loan borrowers at UNT must also complete the online Entrance Counseling requirements and have a valid Master Promissory NoteTo take out a Direct Loan for the first time, you must complete a Master Promissory Note (MPN). You can complete the MPN online at the StudentLoans.gov website. The MPN is a legal document in which you promise to repay your loan(s) and any accrued interest and fees to the Department. It also explains the terms and conditions of your loan(s). If you are applying for a Direct PLUS for the first time as a graduate/professional student, you'll need to complete and sign a PLUS MPN that is separate from the one that you use for your Direct Subsidized and Unsubsidized Loans. (MPN) on file. Continuing student loan borrowers must complete Loan Management Counseling.
Can I go ahead and complete the loan counseling now?
Yes. If you are a new borrowerSee First-Time Borrower at UNT (including transfer students), you may complete your Federal Direct Loan Entrance counseling at anytime. This can be done at StudentLoans.gov. You will need your PIN number (as assigned when you signed the FAFSA) and enter University of North Texas as a school to receive the results. Parent PLUS borrowers do not need to complete Entrance Counseling.
If you a continuing borrower at UNT, you may complete your Loan Management counseling through Mapping Your Future. You must enter University of North Texas as your school to receive the results. Be sure to keep your confirmation number for future reference.
If I borrowed through a private bank last year, will I have to pay two different lenders now?
Your Federal Direct Loan will be serviced by the Department of Education, so you will receive correspondence and payment information from both the Department of Education and your prior lender or servicerA servicer is an organization that collects payments on a loan and performs other administrative tasks associated with maintaining a loan portfolio. Loan servicers disburse loans funds, monitor loans while the borrowers are in school, collect payments, process deferments and forbearances, respond to borrower inquiries, and ensure that the loans are administered in compliance with federal regulations and guarantee agency requirements. EduServ is the largest private servicer of student loans in the US.. You have the option of consolidating all of your FFEL Stafford loans with the Direct Loan program after you graduate or leave school. If you consolidate with the U.S. Department of Education, your previous federal loans would be paid in full and all of your payments would be made to the Direct Loan program.
What happens to the Stafford loans I borrowed via my bank or lender in prior years? Will they still be deferred now that UNT is changing its loan processing?
UNT reports your enrollment information through the National Student Clearinghouse to your lenders and to the National Student Loan Data system, as required by Federal Law, on a regularly scheduled basis to assure your deferment status is current.
Where can I find information about deferments or forbearance requests?
To find this information, please visit the Direct Loan Deferment and Forbearance website. To gather the form(s) needed for deferment or forbearance, you will need to contact your loan servicers(s) directly.
To find out who your loan servicer(s) is, please log onto the National Student Loan Data system (NSLDS), using your PIN number (as assigned when you signed the FAFSA).
Where do I find information about Federal Loan Consolidation?
Visit Direct Loan Consolidation
What is required when I leave UNT?
Each Federal Direct Loan borrower at the University of North Texas is required to complete Student Exit Counseling shortly before completing a degree, leaving UNT (i.e., withdrawing, graduation) or ceasing half-timeDuring each term, 6-8 credit hours is considered half-time for undergraduate students. For graduate students, 5 hours is considered half-time. enrollment. To complete this requirement, go to the National Student Loan Data system (NSLDS) Exit Counseling.
PLUS Loan FAQs
How do my parents apply for a loan?
The FAFSA must be completed for Federal Direct PLUS eligibility to be determined.
To apply, the parent borrower must log onto StudentLoans.gov to submit the Direct Parent PLUS Request. Detailed instructions for completing the Direct Parent PLUS Request are available here.
A credit check is conducted by the U.S. Department of Education to establish eligibility. You cannot have an adverse credit history. Borrowers will be notified if additional action is necessary.
I borrowed a PLUS loan at UNT last year. What do I have to do this year to get another PLUS loan?
To apply, the parent borrower must log onto StudentLoans.gov to submit the Direct Parent PLUS Request. Detailed instructions for completing the Direct Parent PLUS Request are available here.
A credit check is conducted by the U.S. Department of Education to establish eligibility. You cannot have an adverse credit history. Borrowers will be notified if additional action is necessary.
What if my parent is not eligible for federal Direct PLUS loan?
The Department of Education will run a credit history check to determine eligibility for a Direct PLUS loan. The department will provide additional information to parents about other options (i.e. pursue a co-signer/endorser or appealAn appeal is a formal request to have a financial aid administrator review student aid eligibility and possibly use Professional Judgment to adjust the figures. For example, if the student believes the financial information on their financial aid application does not reflect their family's current ability to pay (for example, because of death of a parent, unemployment, or other unusual circumstances), the student should definitely make an appeal. The financial aid administrator may require documentation of the special circumstances or of other information listed on their financial aid application. the denial) if there is adverse credit history. If the parent borrower chooses not to pursue other options, please notify UNT to pursue the denial and offer the student additional unsubsidized funding.
What is a Federal Direct PLUS for Graduate Student Loan?
The Deficit Reduction Act of 2005 modified the Federal Direct PLUS program (formerly offering loans only to parents), which now allows graduate students to borrow PLUS loans. Students must request Student Financial AidMoney provided to the student and the family to help them pay for the student's education. Major forms of financial aid include gift aid (grants and scholarships) and self help aid (loans and work). and Scholarships staff to review their eligibility for a Graduate Professional Federal Direct PLUS loan.
Are there any loan fees?
In addition to loan interest, there are fees associated with borrowing a Federal Direct PLUS Loan. The U.S. Department of Education charges a 4% gross fee, and then gives borrowers an up-front rebate of 1.5%. This means that a net fee of 2.5% of the total amount borrowed each year will be charged. This fee is deducted from the loan by the Department of Education before the proceeds are credited to a student's account.
IMPORTANT NOTE ABOUT THE UP-FRONT REBATE: The up-front interest rebate that has been provided to Direct Loan borrowers at the time of their loan disbursement will no longer be offered on any Direct Loan Program loan with a first disbursement date that is on or after July 1, 2012. For more information, you can review the Department of Education's electronic Announcement.
What about repayment?
Repayment of the Federal Direct PLUS Loan principalThe principal is the amount of money borrowed or remaining unpaid on a loan. Interest is charged as a percentage of the principal. Insurance and origination fees will be deducted from this amount before disbursement. and interest begins 60 days after the final disbursement for the loan period. Deferments are available for parents who wish to postpone repayment until after the dependentSee Dependency Status. student has graduated or withdrawn.
To find this information, please visit the Direct Loan Deferment and Forbearance website. To gather the form(s) needed for deferment or forbearance, you will need to contact your loan servicers(s) directly.
To find out who your loan servicer(s) is, please log onto the National Student Loan Data system (NSLDS), using your PIN number (as assigned when you signed the FAFSA).
Where can I get additional information?
For more information, visit the Direct Loans - Parent PLUS information website.
