Understanding Student Loans
Loans are a type of financial aid that can help you cover college costs of attending college. Loans are different from grants and scholarships because you have to repay loans after you leave school or drop below half-time enrollment.
This page explains the types of loans available to Florida Atlantic students, how to apply for them and what you need to know about repayment.
Federal Student Loans
Federal student loans tend to have lower interest rates and flexible repayment options, so many students choose them first.
Federal student loans include:
-
Direct Subsidized Loans
These are available to undergraduate students who demonstrate financial need. The federal government pays the interest while you’re in school at least half time. -
Direct Unsubsidized Loans
These are available to undergraduate and graduate students regardless of financial need. You are responsible for the interest from the time the loan is disbursed.
Federal loan amounts are determined by annual limits and your cost of attendance.
Learn more about federal student loans.
How to Apply for Loans
Federal student loan applications require a few steps.
- Complete the Free Application for Federal Student Aid, or FAFSA, every year.
- Review your financial aid offer in myFAU to see if loans are included and what amounts you’re eligible for.
- Accept the loans you want in myFAU and complete any entrance counseling that may be required before you can receive the loans.
- Complete a Master Promissory Note (MPN) for federal loans; you must complete the MPN before your funds can be released.
Loan Counseling – What You Need to Know
Federal student loans require entrance counseling before your first disbursement. This is an online session that explains:
- Your loan terms
- How interest works
- Your repayment responsibilities
- What happens if you drop below half-time enrollment
You must complete entrance counseling before your loan funds can be released.
Loan Types and Options
Federal Direct Loan Details
Federal Direct Loans include both subsidized and unsubsidized loans. These loans are funded by the federal government with terms set by federal law.
This section covers:
- Who can borrow
- Estimated limits
- Interest rate basics
- Repayment rules
Federal Direct Loans are normally the first option for students because of lower cost and federal protections.
For details on annual loan limits and eligibility, refer to Federal Student Aid resources.
PLUS Loans for Parents and Graduate Students
PLUS Loans are federal loans that:
- Parents of dependent undergraduate students may borrow approved loan amounts to help cover education costs not met by other aid
- Graduate or professional students may borrow approved loan amounts
PLUS Loans require a credit check. The terms and interest rates for PLUS loans are different from those of direct subsidized and unsubsidized loans.
Private (Alternative) Loans
Some banks and other lenders offer private loans.
Things to know:
- Interest rates and repayment terms will depend on the lender
- Some require a credit check and co-signer
- They are not part of federal loan programs
If you consider private loans, compare offers carefully and talk with a financial aid advisor first.
Loan Repayment Overview
You must repay loans after you leave school or drop below half-time enrollment unless you qualify for a deferment or other relief option.
There are a few common repayment plans for federal loans, including:
- Standard repayment – fixed monthly payments over 10 years
- Income-driven repayment – monthly payments based on your income
- Graduated repayment – lower initial payments that increase over time
Your loan servicer determines repayment details after you enter repayment.
- Loan funds are usually credited to your Florida Atlantic account after the term starts.
- You generally start repayment after you graduate, withdraw or drop below half time.
- Interest accrues (adds up) from the time the loan is disbursed.
Specific loan timelines and requirements are different for each loan type.
Borrow only what you need. Loans are real financial commitments that affect your future. To stay on track:
- Review your loan details in myFAU
- Understand your interest rates and fees
- Plan for repayment before you leave school
- Contact your loan servicer with questions
Getting help early can prevent repayment problems later.
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