Federal Stafford Student Loan

There are two types of Federal Stafford Student Loans, Subsidized and Unsubsidized.

To be eligible for a loan you must:

• Be a United States citizen or national, permanent resident, or an eligible non-citizen.
• Be enrolled at least half time (6 credits) in an eligible program
• Be making Satisfactory Academic Progress
• Not be in default on a Stafford, PLUS, SLS or Consolidation Loan
• Not owe a Title IV refund
• Not have been convicted of any offense under state or federal law involving the sale or possession of a controlled substance

Subsidized Federal Stafford Student Loan

A Subsidized loan is awarded based on the student's financial need as computed by the Financial Aid Office and the Federal Processor. The U.S. Department of Education pays the interest on the loan while the student is enrolled for at least 6 credits and during the 6 month grace period once the student ceases enrollment.

If a student is not enrolled for a period of six months or longer, the student will go into repayment. At that time interest will begin to accrue at a fixed interest rate not to exceed 8.25% (Stafford Loans disbursed on or after July 1, 1995). Once in repayment the minimum monthly payment on a loan is $50.00. A 3% origination fee may be subtracted from the loan at the time of disbursement.

Unsubsidized Federal Stafford Student Loan

An Unsubsidized loan is not awarded on the basis of need. If a student is not eligible for a full Subsidized Stafford Student Loan, the student may be awarded BOTH a Subsidized and an Unsubsidized loan.

The U.S. Department of Education DOES NOT pay the interest while the student is in school. Interest accrues at a rate not to exceed 8.25% and is fixed. An interest only payment can be made while the student is in school or it can be deferred. Once in repayment the minimum monthly payment on a loan is $50.00. A 3% origination fee may be subtracted from the loan at the time of disbursement.

Annual Loan Limits

The figures listed below are maximum yearly (Fall, Spring and Summer semesters) amounts a student may borrow. The amount you are awarded may be less than the Annual Limit based on other aid received.

Dependant Student (per FAFSA guidelines)

Independent Student (per FAFSA guidelines)

Processing Fees

All Federal Subsidized and Unsubsidized Stafford Loans may be subject to at least a 1.0% origination fee and up to a 1.0% default fee, which may be deducted proportionately from each of your loan disbursements.

Reviewed Lender List

Northwestern Michigan College offers a "reviewed" lender list with multiple lenders for students to choose from through the Federal Family Educational Loan Program (FFELP). Through multiple years of service we have found that these lenders provide excellent borrower benefits; accuracy of information; timeliness in processing; and exceptional customer service to the student and to our institution. To ensure a smooth loan process, all of these lenders process loans through ScholarNet, which is an online service through Great Lakes Guarantee Agency.

Student borrowers have the right to choose which lender they wish to use. The following are other lenders that students have used at NMC in the last three years; some no longer provide Stafford Loans to Community Colleges: Alaska Commission, Bank One, Catholic Federal Credit Union, Chase, Citibank, Collegiate Solutions, Members Credit Union, National City Bank, NelNet, Sallie Mae, Student Loan Express, Wachovia, Wells Fargo.

*** Fill out a Loan Request for the 2008-09 Academic Year ***

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