Student Loan Programs
For students who do not qualify for grants or scholarships or need additional funds to meet their educational expenses, there are three loan programs to help fund educational needs.
Loan Program 1 FOR STUDENTS: William D. Ford Federal Direct Loan Program:
- Subsidized Direct Loan: A federally subsidized student loan is made on the basis of the student's financial need and other specific eligibility requirements. Subsidized loans have subsidized interest, which means that the federal government pays the interest on these loans while borrowers are enrolled at least half-time.
- Unsubsidized Direct Loan: An unsubsidized student loan is not based on financial need. Eligibility is based on a student's overall financial aid budget. Interest is capitalized and starts to accrue when the loan is disbursed.
To be eligible for a federal student loan, the student must submit a FAFSA, maintain Satisfactory Academic Progress (SAP) standards, be degree seeking, and enroll/attend at least six credit hours per semester.
For both subsidized and unsubsidized loans, the borrower begins repayment after a six month grace period. This grace period begins upon graduating, withdrawing from school, or dropping below half-time.
The Free Application for Federal Student Aid (FAFSA) serves as the application for Direct Loans. If a student wants a loan included in their award package, the student should review the PSCC Student Loan Information and Request Form. This form is located in your MyPellissippi portal under the Financial Aid Tab, Important Forms and Links section. It gives guidance on how much loan money be can borrowed. Evaluate the amounts carefully, and keep in mind that any amount borrowed must be paid back.
- Submit the Loan Form in your myPellissippi account.
- Submit Loan Entrance Loan Counseling – This is required for first time loan borrowers.
- Submit Master Promissory Note – This is required if the student is new to the Direct Loan Program.
Loan Program 2 FOR STUDENTS: Private Alternative Loan Program:
A private alternative loan is a non-federal educational loan, through a private lending institution, issued in the student's name and often requiring a cosigner. These loans vary in the terms, conditions, and eligibility requirements. PSCC does not endorse any private loan lender, so students are encouraged to research which private loan will best meet their needs. Private loans typically have variable and higher interest rates than federal loans, are based on individual credit scores, may require interest payments while you are in school, have more fees, and have less flexible repayment options than federal loans. A student should NEVER consider borrowing a private loan until all federal loan options have been exhausted. For more information on the differences between the federal student loan programs and private education loans, visit the Department of Education's Federal Aid First web site.
Many lenders offer private loans to help cover up to 100 percent of the cost of attendance, less other financial aid received. Once a lender approves a private loan, PSCC will be contacted electronically to obtain verification of student eligibility. After all PSCC charges have been paid, any remaining money will be sent to the student, either electronically or a mailed paper check on the standard disbursement day schedule.
PSCC does not endorse any lender and is not responsible for the timeliness of private loans. Below are lenders that PSCC students have used in the past. The contact information is provided as a service and not as an endorsement of the lender. A student may choose one of these lenders or any other lender of your choice. For all questions related to private loans, the student must contact their lender.
Loan Program 3 FOR PARENTS: Parents' Loan for Undergraduate Students (PLUS):
Federal PLUS loans are for parent borrowers to assist the dependent student with educational expenses. This loan is not based on financial need. Repayment of principal and interest begins within 60 days of disbursement. The annual loan limit is the cost of education minus any other financial assistance the student is receiving.
To be eligible for a federal PLUS loan, the parent’s student must submit a FAFSA, maintain Satisfactory Academic Progress (SAP) standards, be degree seeking, and enroll/attend at least six credit hours per semester.
To apply for a Federal Direct PLUS Loan,
- Submit the Federal Direct PLUS Loan Request Form
- Submit a Master Promissory Note (MPN) - This is required if the parent is new to the Direct Loan Program.
Federal regulations require student loans to be disbursed in two equal disbursements.
A Fall/Spring loan will be disbursed evenly between the two semesters, one half in the Fall semester and one half in the Spring semester.
A Fall only, Spring only, or Summer only loan is also required to be disbursed in two equal disbursements. In this case, the first disbursement occurs approximately two weeks after classes start. The second disbursement will occur in the middle of the semester.
Disbursement dates are located on the Financial Aid website under Disbursement Dates.
If a student drops below half-time, withdraws, graduates, stops attending, or does not return to PSCC (even if the student plans to attend another school), the Federal Government requires the student to complete Exit Loan Counseling. Exit counseling gives students important information about repaying their student loans.