Student Loans are the primary sources of financial aid for many students. All loans, including student loans, represent debts that must be repaid; however, most student loans do not go in to repayment until after you leave school or graduate. In addition to delayed repayment, most student loans have relatively low interest rates, several repayment options from which to choose, circumstances under which you can postpone repayment, and other favorable terms and conditions.

In order to apply for any type of Federal Direct Student Loan (subsidized, unsubsidized, and/or a PLUS loan), you must complete the financial aid application process at KCMA. For more information regarding this process refer to How to Apply.

Federal Direct Stafford (Subsidized and Unsubsidized) Loans

The main source of student loans is the federal government. KCMA participates in the Federal Stafford Loan Direct Student Loan Program. KCMA disburses your loan funds on behalf of the United States Department of Education. No bank or guarantee agency is involved in the direct lending process.

The Federal Direct Student Loan that you, the student, can borrow in your own name can be either subsidized or unsubsidized or a combination of both. The interest rate on your Federal Direct Subsidized or Unsubsidized Loan is a variable rate that is adjusted each July 1.

After you have applied for financial aid at KCMA, you will receive an Award Letter, which lists the maximum loan amounts you are eligible to borrow from both the subsidized and/or unsubsidized loan programs.

Once a student is awarded a Federal Direct Stafford Loan, they must complete a Master Promissory Note (MPN) on the web at www.dlenote.ed.gov and Entrance Counseling on the web at www.dlservicer.ed.gov.

In order to qualify for a Federal Direct Subsidized Loan, you must have financial need.

• To determine if you have financial need, your Expected Family Contribution from your FAFSA and any additional aid you may have coming to you is subtracted from your “cost of attendance”.
• If you do qualify for a subsidized loan, the federal government pays the interest on the loan, i.e., subsidizes the loan while you are in school, during your six-month grace period prior to repayment, and during any authorized period of deferment.

Students without financial need are eligible for the Federal Direct Unsubsidized Loan.

• This means that you will be responsible for the interest on the loan from the time you receive the funds until the loan is paid in full.
• You have the option of allowing the interest to accumulate, or accrue, on the loan while you are in school and during your six-month grace period prior to repayment.
• You also have the option of paying the interest on the loan as it accumulates. If you decide to delay interest repayment, the interest that accumulates will be "capitalized", that is, will be added to your loan principal when you begin repayment.

Entrance Counseling

Before you receive your first Federal Direct Stafford Loan at KCMA, the federal government requires you to participate in Entrance Counseling on the web at www.dlservicer.ed.gov. The purpose of Entrance Counseling is to educate you about student loans so you will be a well-informed borrower. Entrance Counseling covers such topics as interest rates, repayment options, your rights and responsibilities, the consequences of default, etc.

**According to federal law, no funds can be disbursed to any student until the Entrance Counseling requirement has been met**

Exit Counseling

IF you received a Federal Direct Stafford Loan while a student at KCMA, then you are required to complete Exit Counseling at www.dlservicer.ed.gov BEFORE you leave school or graduate.

The purpose of Exit Counseling is to select a repayment plan; review deferment, forbearance, and cancellation provisions; discuss loan consolidation; and review the serious consequences of delinquency and default. You will receive a notice when it is time for you to complete the Exit Counseling requirement.

**If the Exit Counseling requirement is not met within the designated time frame, you may experience a delay in receiving your degree and/or final transcript**

Federal Direct Stafford Loan Repayment

If you think you might have a problem making a scheduled payment on your student loans, you should contact the Federal Direct Student Loan Servicing Center immediately at 1-800-848-0979

Default occurs when a Federal Direct Loan borrower becomes 270 days delinquent in making a loan payment. There are numerous adverse consequences that will result if you default on your student loan. These negative consequences include, but are not limited to, the following:

• You will not be eligible for future federal financial aid.
• Your account may be turned over to a collection agency.
• Your credit rating will be damaged.
• Your federal income tax refund may be withheld from you.
• Your wages may be garnished.
• Your car and other possessions may be repossessed.
• The federal government can sue you.

PLUS Loans

The Federal Direct Parent Loan for Undergraduate Student (PLUS) is a loan for the natural parent, adoptive parent, or legal guardian of a dependent undergraduate student. In certain circumstances, a stepparent may be eligible to borrow.

• Once you have applied for financial aid (refer to How to Apply), your parent will be sent a Direct PLUS Loan Credit Authorization to complete, or click here for the PDF. The parent borrower must have a good credit history in order to be able to borrow a PLUS Loan. If you have questions about your Direct PLUS Loan credit history, contact the Loan Origination Center at 1-800-557-7394.
• If the parent borrower does not pass the credit check, the loan may be denied outright or the parent may be offered the option of obtaining a creditworthy endorser.
• The PLUS Loan interest rate is a variable rate. The interest rate is adjusted each July 1. You can find out the current interest rate on Direct PLUS Loans by calling 1-800-848-0979.
• There is no grace period on a Parent PLUS Loan, so interest begins to accumulate at the time the first disbursement is made. Your parent must begin repaying both principal and interest while you are in school.

Federal Graduate PLUS Loan is now available for graduate students to borrow for educational expenses.

• A student can apply for the loan in their own name as long as they are enrolled in an approved graduate program at an accredited school.
• The process is primarily the same as for a Parent PLUS Loan, however the student is NOT required to enter repayment immediately if they request a deferment.

Perkins Loan

The Federal Perkins Loan is a federally funded low-interest loan. Kettering College of Medical Arts is the lender, using funds from the federal government and/or payments collected from previous borrowers.

Since funds are limited, in order to apply for the Perkins Loan, you must apply for financial aid at KCMA by the Priority Deadline of March 31st. For more information regarding this process refer to How to Apply.

When you graduate, or leave school for any other reason, you must complete a Perkins Loan Exit Interview. This Exit Interview will give you more information about your repayment options, deferments, cancellation provisions, etc. You will need to contact Toni Ennis at 937-298-3399 Ext. 47033 to complete Exit Counseling. Failure to do so will result in a "HOLD" being placed on your grades, diploma, etc.

Please keep in mind the Perkins Loan Exit Interview requirement is in addition to the Federal Direct Loan Exit Interview requirement.

Nursing Loan

The United States Department of Health and Human Services administers the Nursing Student Loan (NSL) Program. The NSL Program provides long-term, low-interest loans to both full and half time students pursuing a degree in nursing. Students must show financial need in order to qualify. Each school participating in the NSL Program is responsible for selecting the loan recipients.

Since funds are limited, in order to apply for the Nursing Loan, you must apply for financial aid at KCMA by the Priority Deadline of March 31st. For more information regarding this process refer to How to Apply.

Students will be notified of their eligibility for the Nursing Student Loan on the Award Letter. In general, KCMA makes Nursing Loans that average $2,000 per school year to be disbursed in two equal payments, i.e. $1000 per semester for two semesters. If you are awarded and do not decline your Nursing Loan, you will be sent a Nursing Loan Application. You must complete and return this form to the Financial Aid Office in order to finalize the application process for your Nursing Loan.

When you graduate, or leave school for any other reason, you must complete a Nursing Loan Exit Interview. This Exit Interview will give you more information about your repayment options, deferments, cancellation provisions, etc. You will need to contact Toni Ennis at 937-298-3399 Ext. 47033 to complete Exit Counseling. Failure to do so will result in a "HOLD" being placed on your grades, diploma, etc.

Nurse Education Assistance Loan Program (NEALP)

The Nurse Education Assistance Loan program (NEALP), administered by Ohio Board of Regents, provides financial to Ohio students enrolled (or accepted for enrollment) for at least half-time study in an approved nursing program. The maximum award is $3000 per year for up to four years of eligible study.

Currently there are two NEALP application deadlines during the year.

• Applications will be available from January until June 1 for classes beginning in the fall.
• Applications will be accepted for new students with classes beginning in January from June 2 through November 1.
• For more information contact the Ohio Board of Regents State Grants and Scholarships Department P.O. Box 182452 Columbus, Ohio 43218-2452
  1-888-833-1133