Direct Loan Process
The William D. Ford Direct Loan Program is a form of loan aid from the Department of Education. The William D. Ford Direct Loan Program is administered directly with the United States Department of Education. Saddleback College participates in the Direct Loan Program only and will not certify private or alternative loans. There are two forms of loans made available by Saddleback College through this program: subsidized, and unsubsidized.
Subsidized: This is a need-based loan for which the interest is paid by the government while the student is in school at least half-time. Interest will begin to accumulate at the start of the student’s 6 month grace period (the period of time before repayment, which occurs after you are no longer in school at least half time).
Loan Limitations (limit of how many years a student may receive subsidized loans)
- Applies to “new borrowers” (students with zero balance) on or after July 1, 2013
- Student not eligible to receive additional loans if they have already received subsidized loans for 150% of the published length of their academic program.
Limitations of Subsidized Loan Eligibility
2- year Associate’s Degree
3 years of subsidized loan eligibility
1- year of Certificate Program
1 ½ years of subsidized loan eligibility
- In addition, any previously-borrowed subsidized loan will begin to accrue interest at the time that the student reaches the 150% timeframe.
Unsubsidized: You are responsible for paying the interest that accrues on the unsubsidized loan from the time the loan is disbursed until it is paid in full.
Direct Loan Origination Fee (May be subject to change): A 1.051 loan origination fee is charged and taken off the top of the loan. If you borrow $1,000, the amount disbursed is $990 (For example, $1,000 less the $10 loan origination fee).
If you are interested in applying for a Direct Loan, please note the following:
- You must have completed a financial aid file at Saddleback College before the Student Financial Assistance & Scholarship Office (SFASO) can process your loan request for a Direct Loan. This means you must have completed a FAFSA and turned in all of the required documents requested.
- All returning/transfer students must have an overall minimum cumulative (all colleges) GPA of 2.0
- You must be enrolled in a minimum of 6 units per semester coursework (second eight week classes are subject to a later disbursement).
- Students participating exclusively in distance learning programs will have a delayed disbursement.
- You must not be in default or owe an overpayment to any other financial aid program.
- The earliest date student loan refunds will be issued is approximately four weeks after the start of the semester. All first-time borrowers have a mandatory thirty-day waiting period before they receive their first disbursement. The earliest date student loan refund checks will be issued to first-time borrowers is approximately six weeks after the semester begins. You should not plan to use the loan money to pay registration fees, early fee payments or to buy your textbooks as these funds will arrive after classes begin.
- If your loan request is approved, the loan will be submitted to the National Student Loan Data System(NSLDS), and will be accessible by guaranty agencies, lenders, and schools determined to be authorized users of the data system.
- Your loan funds will be disbursed in two separate disbursements per semester. Disbursement dates will be included on your award letter and the funds will be issued on your Higher One Saddleback Card. For more information about the Saddleback Card, go to http://www.myonemoney.com/service/students
- All Loan borrowers will be required to submit the Federal Direct Loan Program Exit Loan Counseling before a final loan disbursement. Complete the Exit Loan Counseling online at http://www.nslds.ed.gov/nslds_SA/. The Student Financial Assistance/Scholarship Office will be notified electronically after your exit loan counseling has been submitted to the Department of Education.
STEPS FOR APPLYING FOR A FEDERAL DIRECT LOAN
1. You must be enrolled for 6 units to be eligible for loans.
2. Continuing and transfer students must have a minimum 2.0 Cumulative GPA
3. Complete the 2014-15 Free Application for Federal Student Aid
3. Fully complete ALL sections of the Federal Direct Loan Request Form.
4. Complete a new Master Promissory Note (MPN) every year for SC at www.studentloans.gov. (Manage My Direct Loan)
5. Complete the Entrance Counseling every year at: www.studentloans.gov. (Manage My Direct Loan) PRINT Counseling Quiz results and submit with your loan request.
6. Complete the Financial Literacy Counseling at www.mappingyourfuture.org. PRINT Financial Literacy Confirmation Page and submit with your loan request.
7. Visit https://www.nslds.ed.gov. Log in using your FAFSA PIN. If you received loan or grants in the past, your information will be displayed. The amount displayed, plus interest, must be repaid in the future or it could be detrimental to your credit history. Applicants must remember loans have to be repaid and should borrow as little as possible. You must print out this information and attach it to your loan request.
It is extremely important that the Student Financial Assistance & Scholarship Office has your correct address. The Higher One Saddleback Card is mailed to the address that you have provided on the 2014-2015 FAFSA. If this address is not correct, you may complete a change of address form in the Student Financial Assistance & Scholarship Office. Please note that you MUST have a photo I.D. for all inquiries made in the Student Financial Assistance & Scholarship Office. SC 106