Federally Guaranteed Loans
William D. Ford Federal Direct Loan Programs
Direct Loan programs provide federal education loans to students and parents of undergraduates. Student loans have a 1.0% origination fee. Federal student loans are guaranteed, meaning there is no credit check.
Sign onto Safari to accept or decline aid. Central Washington University uses the active confirmation process, meaning we will not process this aid unless you accept it.
First-time Direct Loan student borrowers:
- complete Entrance Counseling and sign a Master Promissory Note at www.studentloans.gov
Federal Direct Subisized Student Loan
A subsidized loan indicates that the student is not charged interest while enrolled in school. Repayment begins six months after the student is enrolled less than half time. The interest rate is 3.4% and begins to accrue when the student ceases to be enrolled at half time. The interest rate is fixed and interest paid is tax deductible. The amount of the loan is determined by the student’s need and year in school (see below). Need = Cost of Attendance (COA) – (Expected Family Contribution (EFC) + resources + other aid). New for 2012-2013 – The Federal Direct Subsidized Loan for Graduate Student’s is being discontinued. Graduate Student’s will only be eligible for Unsubsidized Loan. Also, the interest subsidy for Undergraduates and Post Baccalaureates during the 6 month grace period will be eliminated. Interest accrual for Subsidized Loans will begin at the time of separation.
Federal Direct Unsubisized Student Loan
The unsubsidized loan accrues interest while the student is in school. You can either pay the interest or it will be capitalized (added to your principal loan balance, thus increasing the amount you’ll repay). Independent undergraduate students may borrow an additional unsubsidized loan; this additional loan is also available to dependant students whose parents have been denied the PLUS. The interest is fixed at 6.8% and repayment of the loan begins six months after the student is enrolled less than half time. Interest is tax deductible.
Federal Direct Parent Loan for Undergraduate Students (PLUS)
Parent loan is not guaranteed. The Parent must pass a credit check; if denied, the dependent student may borrow at the independent student rate. A PLUS is an unsubsidized loan for a parent of a dependent student and may be used to meet “Expected Family Contribution” (EFC). Parents may borrow an amount equal to “Cost of Attendance” less any other aid. Parent loans have a 4% origination fee and interest is fixed at 7.9% and is tax deductible. PLUS Borrowers may begin repayment 60-days after the final disbursement of the year OR upon request, defer payments while the student is in school. An additional request can be made to defer for 6 months after the dependent student graduates or drops below ½ time. Deferment request information will be sent to the borrower from the US Department of Education or one of their contracted servicers. You will have an opportunity to reduce the amount of the loan through the online PLUS Request process at www.studentloans.gov. Please accept or decline the Parent loan at www.cwu.edu – Wildcat Connection > Safari > SA Self Service > Campus Finances > Accept/Decline Award
In order to receive a Parent Loan, the parent must apply online through the PLUS Request process and sign an electronic Master Promissory Note at www.studentloans.gov with their FAFSA PIN. This note is for one parent and one student. The parent who accepts this offer may be either a biological or adoptive parent or a step parent whose data is on the FAFSA.
How much can I borrow?
All loans are limited to Cost of Attendance (COA) less other aid. Students may borrow a student loan annually up to:
- $3,500 freshman.
- $4,500 sophomore.
- $5,500 junior/senior/post baccalaureate/Teacher Certification.
This loan will be subsidized to the extent that you have need. Post baccalaureates who are Education majors or preparing for a Masters and all undergraduates are eligible for another $2,000 in unsubsidized loan.
Independent students or a dependent student (whose parent is denied a PLUS loan due to the credit check) can borrow annually additional unsubsidized loan up to:
- $4,000 freshman.
- $4,000 sophomore.
- $5,000 junior/senior/post baccalaureate.
Graduate students (Master candidates) may borrow up to 20,500 Unsubsidized Loan annually and a Graduate PLUS loan up to COA.
- $31,000 as a dependent undergraduate or post baccalaureate student. No more than $23,000 of this amount can be in subsidized loans.
- $57,500 as an independent undergraduate or post baccalaureate student. No more than $23,000 of this amount may be in subsidized loans.
- $138,500 as a graduate student. 20,500 annually unsubsidized Loan. The graduate debt limit includes any Stafford Loans received for undergraduate study.
The Perkins Loan is a subsidized federal campus-based program. Upon entering repayment interest is fixed at 5%. Repayment begins nine months after the student ceases to be enrolled at least halftime. This aid is limited. Interest on all federal education loans is tax deductible. Perkins is awarded to students who have excess need and a 2.8 GPA.
NOTE: The student will receive an email when a loan has been disbursed. If a borrower wishes to cancel a loan after it has disbursed, he/she must inform the CWU Financial Aid Office within 14 days and return the refund check marked VOID. The loan will be backed off the student’s university account and the Loan Program will be repaid immediately. Any university charge that had been paid by the loan will become due and payable immediately.