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Loans

A student loan is money for school expenses that must be paid back with interest. Student loans can help you meet today's education expenses, but they will also bind you to a future of financial commitment that can last as long as 10 years. That's why it's important to fully understand your rights and responsibilities as a borrower before you take out a loan.

The College of Southern Idaho participates in the Federal Family Educational Loan Program (FFELP) Stafford Loan Program and offers student loans funds from private lenders, guaranteed by the Federal Government. There are three types of loans in the FFELP Loan Program, the Stafford Subsidized FFELP Loan and Stafford Unsubsidized FFELP loan and the FFELP PLUS loan (Parent Loan for Undergraduate Students.)

• Important Information you should know about Federal Stafford Loans
• Loan Information - Parent PLUS Loans
• Loan Default
• Applying for a student loan at the College of Southern Idaho is a four-step process

Important Information you should know about Federal Stafford Loans:

Types of Loans

• Subsidized Stafford Loans are "need based." The federal government pays the interest to the lender as long as you are enrolled at least half time and during the "grace period" and authorized periods of deferment. Interest will begin to accrue when you enter repayment.
• Unsubsidized Stafford Loans have no interest subsidy. The loan principal can be deferred, but you must pay the interest monthly or quarterly while enrolled or choose to defer the interest and have the interest added to the loan principal. This is known as "interest capitalization."
• PLUS Loans are loans that parents may be eligible for to help cover the educational cost of their dependent student. There is no interest subsidy on these loans. The parent does generally have to pass a credit check to receive this loan. The yearly limit on a PLUS Loan is equal to the cost of attendance minus any other financial aid the student will receive.

Other Important Information

• The Stafford Loan interest rate is currently fixed at 6.8 percent. The federal PLUS Loan is fixed at 8.5 percent.
• An origination fee of up to two percent and a default fee of up to one percent may be deducted by the lender out of the loan proceeds.
• Repayment begins six months after graduation, withdrawal from college, or enrollment at less than half-time.
• All loans are disbursed in two equal installments, usually one in the fall and one in the spring.
• First time borrowers at CSI are required to complete entrance counseling before the loan can be released.
• If you are a first year, first time borrower, there is a 30-day hold on the disbursement of your loan funds. The 30-day count begins on the first day of the semester.
• If you decide to borrow for one semester only, the loan must be disbursed in two equal installments with the second installment coming at the midpoint of the semester.
• You must be maintaining satisfactory progress to continue to receive your Federal Student Aid. It is the student's responsibility to read and to know the Satisfactory Academic Progress policy.

Loan Information - Parent PLUS Loans

The Parent PLUS loan allows the parents of dependent students, who are enrolled at least half-time, to finance the educational expenses of their child. The annual limit on a Parent PLUS loan cannot exceed the student’s cost of attendance, minus any financial aid the student is receiving. The interest rate is variable (capped at 9%) and begins to accrue at the time the first disbursement is made. Repayment of principal and interest begins 60 days after the loan is fully disbursed.

Borrowers are required to pass a credit check and loan approval is based on credit worthiness. Household income is not considered when determining eligibility for this loan. If the Parent PLUS Loan is denied because of adverse credit, the dependent student may qualify for an additional Unsubsidized Stafford Loan. The amount of eligibility will be determined in part by the student’s grade level, other financial aid, and cost of attendance.

If the parent has exceptional circumstances affecting their ability to borrow, they may not be required to apply for the Parent PLUS Loan before allowing the student to borrow the additional unsubsidized loan. Documentation must be provided, and may be submitted to Student Financial Aid Office. Exceptional circumstances include:

• Parent is incarcerated
• Parent income is limited to public assistance or disability benefits
• Terms of parent’s bankruptcy does not allow them to incur additional debt (letter from attorney required)

If your parent wishes to borrow a Parent PLUS loan, your parent must:

• Be your biological, adoptive or step-parent (legal guardians may not borrow for student)
• Be a US citizen or eligible non-citizen
• Not be in default or owe a refund to any Federal Student Aid program.

The net proceeds from a PLUS (Parent Loan for Undergraduate Students) loan must be disbursed to the Parent Borrower unless the parent, in writing, authorizes the College to give those funds directly to the student. The letter authorizing disbursement of PLUS proceeds to the student should be sent directly to the Student Financial Aid Office.

See http://www.studentaid.ed.gov for further information regarding the Federal Stafford Loan Programs.

Remember, only borrow what you need!

Loan Default

Implications of loan default: If you don't pay back the loan as you agreed to do in your promissory note, you may be in default. A defaulted loan is serious. This can severely impact your credit status. If you default on any federal student loan, the federal government may take some serious actions against you. You might:

• lose wages and tax refunds
• be sued
• lose eligibility for other student aid
• be unable to get loans from any other source for purchases like a home or car
• lose federal job opportunities
• have your car and other property repossessed and sold to pay your loan debt
• have your defaulted loan reported to the credit bureau

If you drop below six credits in any one semester or if you are graduating from the College of Southern Idaho, you will be required to complete an Exit Interview session.

 Information on the Exit Interview process can be found at the following link:

Applying for a student loan at the College of Southern Idaho is a four-step process

First you need to apply for Financial Aid (see steps listed on the main Financial Aid page), then you need to follow the four steps described below:

1. Once your financial aid advisor has reviewed and completed your financial aid file, you will receive an award letter along with your loan request form.  Your loan request form will indicate the type and maximum amount of loan(s) you can receive.  Please read the loan request form carefully and completely. Fill out your loan request form, sign it, and return it to the Financial Aid Office as quickly as possible (you can bring it in to our office in person or you can mail it or fax it to us to the address/FAX number listed at the bottom of this page). Your loan cannot be approved until our office has received your loan request form.
2. If you are a first time student who has never had a Stafford FFELP loan before, you must complete an Entrance Interview Session. In this session you will be told many of your rights and responsibilities as a student borrower. If you have had a previous student loan, you may skip that step.
   

   

3. Select your lender. After the Entrance Interview session, you will need to select a lender. At the bottom of this page we have a list of lenders that the College of Southern Idaho has had experience working with on student loans. You are free to choose any lender that is qualified with the U. S. Department of Education—they will have a Lender Identification Number issued by the Federal Government. If you choose a lender who is not on the list, please contact the CSI Financial Aid Office with that lender information.

When developing the list, we consider several essential criteria, including:

• the types of products offered
• experience with student loans
• lender reliability, stability and reputation   
• existing relationships with guarantee agencies
• commitment to debt management and default aversion  
• the quality, promptness and consistency of services and support provided to the borrower and CSI
• the technology used by the lender (electronic loan application processing and management; compatibility with CSI’s financial aid system)
• competitiveness of the terms and conditions of the loans
• front end fees/benefits offered (e.g. whether the lender buys down loan origination fees and Department of Education required default fees)
• the competitiveness of borrower benefits/incentives offered (interest rate/principal balance reductions for a certain number of on-time monthly payments, interest rate reductions for automatic payments, etc.)
• loan servicing policy (whether the lender sells the loans on the secondary market or keeps them for the life of the loan)
• security (safeguarding of borrower information)

In developing the lender list, CSI uses a matrix based on quantitative and qualitative criteria.  Staff and student experiences with various lenders are also documented throughout the year and considered as a qualitative component.  The lender list is updated once a year (in July) after a committee meets to evaluate the data. 

We also recognize that there are a number of lenders with whom we do not have extensive experience, but who offer excellent products and services.  You are welcome to use any lender you desire.  If, however, you wish to use a lender that is not on our list, please contact the CSI Financial Aid Office at (208)732-6273.  You may need to assist our office by gathering the information necessary to process your loans with that lender.  Students’ choice of lender is never denied nor is the processing of a loan from a lender not on our lender list unnecessarily delayed.  Nevertheless, it is important to note that utilizing lenders with whom we do not have an established relationship may result in delays in processing and/or delivery. 

When you choose your lender for your student loans, you are entering into a long-term relationship.  We encourage you to ask questions, weigh the all the costs and benefits, and pick a lender that best suits your specific needs.

In general, we recommend you borrow all of your student loans from one lender because it will simplify your repayment process.  

If you have any questions about this process, please do not hesitate to contact the Director of Student Financial Aid, Colin Randolph, at (208) 732-6275.

4. Complete a Promissory Note. At the lender website, you will be asked to sign a promissory note for your loan. This is a legal agreement that says you promise to pay back the funds that you have received, with interest. The Master Promissory Note (MPN) is a promissory note used to make one or more loans for one or more academic years (up to 10 years). The MPN for the Federal FFELP Stafford Loan must be completed before any aid will be disbursed and it is required to be completed one time with each lender.

   Once you have completed and electronically submitted the Master Promissory Note, it will take approximately 1-2 weeks for CSI to receive the information. If you do not want to complete the electronic MPN process, you may print a copy of the MPN and mail a copy to your lender. Take care to enter correct information when completing the process. Errors will cause delays.

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USBank
1.800.242.1200
http://www.usbank.com/cgi_w/cfm/personal/products_and_services/
student_banking/stud_loans_ps.cfm?WT.mc_id=r3639
Lender Code: 811698

• Zero Origination Fee
• Zero Default Fee
• 5% Rebate of original principal balance after 36 consecutive on-time payments* (*payments received within 20 days of the due date are considered on-time)
• .25% interest rate reduction for auto debit payments
• Zero payments due during the final 8 months of standard repayment

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Bank of America
1.800.344.8382
https://slms.bankofamerica.com/AO/schoolSelect.do?method=getSchoolDetails&schoolCode=00161900&schoolBranch=00
Lender Code: 824421

• Zero Origination Fee
• Zero Default Fee
• Receive a 0.25% rate discount when using automatic payments.
• 1% principal balance reduction after 12 consecutive on-time payments
• 1% principal balance reduction after 24 consecutive on-time payments
• 1% principal balance reduction after 36 consecutive on-time payments
• Opportunities to earn back interest rate reduction if lost due to late payment

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Sallie Mae Trust
1.888.272.5543
https://opennet.salliemae.com/apploansummary/?school_id=00161900
Lender Code: 802218

• 1% credit based on original loan amount after first 24 on-time payments
• 4% credit on each on-time payment for the first 12 payments
• 0.5% interest rate reduction for auto debit
• Sign up with Upromise and link your Stafford Loan to pay down your outstanding loan balance with your Upromise savings.