The University of Illinois Springfield no longer participates in the FFEL program. Beginning in the fall 2009 semester, UIS began participating exclusively in the William D. Ford Federal Direct Loan program, in which borrowers obtain loan funds directly from the U.S. Department of Education. We believe that the Federal Direct Loan program will offer our students and parents a more stable, streamlined, and predictable borrowing experience. Please click on the "Apply for Federal Direct Loan" tab for information on the Federal Direct Loan Program.
The US Department of Education brochure, Federal Aid First, is a resource for students and families that explains - in simple terms - how they can apply for federal student aid and maximize more affordable, federal aid options. Federal Aid First explains the difference between federal and private student loans, the various kinds of federal student loans offered, ad the dollar amounts available.
UIS participates, through to the Summer 2009 semester, in the Federal Family Education Loan Program (FFELP) whereby federally approved private lenders provide funds that are guaranteed by the federal government. UIS does not have a preferred or recommended lender list. We will process any FFELP loan request from you expeditiously with the lender of your choice.
To begin the application process for either a Federal Stafford Loan, or a Federal Parent Loan for Undergraduate Students (PLUS) please select a lender of your choice. To identify lenders who offer FFELP loans, you may want to check with the bank you currently bank with to see if they offer FFELP loans or you may want to ask your family members who have borrowed through the FFEL program while at college or you may want to do a google search using the term "educational lending" and review the lenders listed in the search results. The Illinois Student Assistance Commission (ISAC) website, College Zone, also has information on selecting a lender of your choice.
Per Department of Education guidance, schools that want to provide basic information to the school's students and parents may provide a comprehensive list of lenders that have made loans to the school's students or parents in the past three to five years and that have indicated that they would continue to make such loans to students at the school. Based on this guidance, we are listing such lenders for informational purposes only, listed alphabetically, who have provided loans to UIS students and parents between the period July 1, 2003 and May 30, 2008. To the best of our knowledge, these lenders continue to participate in the FFEL program. UIS does not endorse nor recommend any of the lenders. We will process any FFELP loan request from you, the student or parent, expeditiously with the lender of your choice.
|Lender Code||Lender Name|
|833067||Academic Management Services (AMS)|
|808851||Access Group, Inc.|
|824421||Bank of America|
|803000||Chase Educational Loans|
|831312||Discover Student Loans|
|832084||First Gateway Credit Union|
|834257||National Education Loan of New England|
|815502||Navy Federal Credit Union|
|833669||Nelnet Academic Loan|
|832994||New Hampshire Higher Education Loan Corporation|
|809921||PNC Bank Education Loan Center|
|802218||Sallie Mae Education Trust|
|833128||South Carolina Student Loan|
|831455||Student Loan Funding Resources, Inc.|
|807176||Wells Fargo Ed Financial Service|
Once you decide on the lender of your choice, go to their website and begin the process of completing your Federal Stafford Loan Master Promissory Note or Federal Parent Loan for Undergraduate Students (PLUS) Master Promissory Note on-line.
Once you have selected your lender, completed the MPN, completed the Entrance Loan Counseling session, returned your award letter to our office and your financial assistance file is complete, please allow at least two weeks (7-10 business days) for the receipt of the funds in our office once the semester is in session. The funds will then be disbursed and credited to your student account at the University and any excess funds will be processed by the Office of Business and Financial Services. The excess funds will be electronically deposited into your designated bank account. This whole process may take a little longer during the beginning of the semester.
Keep in mind that it is best if you borrow all of your educational loans from the same lender, so select a lender with whom you either currently have a FFELP loan or whose borrower benefits are most attractive to you. Please review each lender's benefits before selecting a lender. You might want to inquire about the following differences when selecting a lender:
You have worked hard in school and the work has paid off because you have been admitted to the college of your choice. Now you have a new challenge: how are you going to pay for your education?
If you or your parents apply for student loans, here are some basics to keep in mind and questions to ask of your school and lender. To apply for student financial assistance, students complete a Free Application for Federal Student Aid (FAFSA). Students use this application to apply for federal student grants, work study aid and loans as well as most state and private aid.
If you have been awarded financial aid at your school, you will receive a financial aid award letter. This letter may contain a range of financial aid options, including grants (which you do not have to pay back), loans (which you do have to pay back) and work-study (employment at the school). Among the loans that may be offered to you are Stafford loans (either subsidized or unsubsidized) and PLUS loans (usually taken out by either parents of undergraduates or by graduate students themselves). These loans are guaranteed by the federal government and are known as Title IV loans. In addition, your award letter, or your school’s financial aid office, may suggest that you finance a part of the cost of attendance with alternative loans from private lenders. These loans are neither subsidized nor guaranteed by the federal government.
Many schools have so called “preferred lender” lists. These are lenders that the school has decided to recommend to their students. However, you should be aware that just because a lender is on the “preferred lender” list, that does not mean that the particular lender is the best one for you to use. A student loan is a serious commitment and you should do your own research to find the loan with the best terms for you. Ask your financial aid officer how they chose preferred lenders for the list. Ask questions such as:
UIS does not have a preferred or recommended lender list. We will process any FFELP loan request from you expeditiously with the lender of your choice.
Remember, when completing a Master Promissory Note for a student loan, you are entitled to choose your letter. If the Note is pre-printed or has an electronic drop-down menu, you should be able to add a different lender. If you are not permitted to insert your chosen lender, please call the Attorney General’s consumer hotline at the telephone numbers below.
Accordingly, many lenders compete on repayment benefits—on the “back-end” of the loans. For example, one lender will offer to cut your rate 1.5% if you make 24 on-time payments in a row, while another will offer to cut your rate 2% if you make 36 on-time payments in a row. Although this competition is legal, keep in mind that many lenders sell their loans on a secondary market. This means that even if you select Bank A as your lender, Bank A may turn around and sell your loan to Bank B. It is important to make sure that if your loan is sold, the “back-end” benefits will travel with the loan. In some instances, the sale of the loan will terminate the very benefits that caused you to take out that particular loan in the first place! To preserve these benefits, have your lender commit to them in writing. If your lender refuses, call the Attorney General’s consumer hotline.
Make sure to keep copies of all the solicitation/advertising materials you receive from your lender or from your school, as well as your loan paperwork so that you will be able to document the promises made to you by your lender when it comes time to start repaying your loan years later. In many cases, the rates that are advertised to you do not appear in any of the actual loan documents that you sign. Therefore, it is important to keep the advertisements where these rates appear so that you will be able to document the promises made to you by your lender when it comes time to start repaying your loan years later.
The right to unbiased advice about loans and lenders from your financial aid office.
The right to choose the lender that is best for you, even if that lender is not included on your school's preferred lender lists.
The right to know what criteria your school uses to select preferred lenders. And the right to know whether preferred lenders are paying the school or financial aid officials.
The right to know what benefits or rate discounts lenders offer, and whether those benefits or discounts will be available immediately, or only after a certain number of consecutive timely payments.
The right to know if a lender has agreed to sell its loans to another lender.
The right to know whether borrower benefits and discounts will continue if the loan is sold.
The right to know what interest rate you will be paying for the loan before you borrow.
The right to exhaust your federal borrowing options (Stafford, PLUS, and Perkins) before turning to higher-cost private loans.
Remember: If you pay your school bills on a credit card, make sure you can pay the amount due in full. Otherwise, you may find yourself with a student loan in the guise of a high interest credit card debt.
For more information, visit http://www.oag.state.ny.us NewYork State Attorney General's Office
The current credit crunch has students and parents concerned about whether they will be able to get the loans they need to cover college costs. The good news is that federal student loans are and will remain widely available to students and families at all income levels. These loans come with government-guaranteed benefits: affordable, fixed interest rates; substantial borrower protections; and new repayment and forgiveness options. However, the small percentage of undergraduates who use private, non-federal loans are likely to face stricter credit standards and possibly higher prices. Students and parents should only consider private loans as a last resort because of their high risks and costs.
To help people make the most of their student loan options, here are practical and creative answers to some of the most common questions and concerns.
“I’m not needy enough for government grants or loans.”
Federal Stafford loans are available regardless of family income. The rate is fixed (currently 6.8%) and comes with a wide range of repayment options. Depending on your level of need, you may be charged interest while in school, but these loans are still much safer than private loans.
|“I don’t have a good credit record.”||There is no credit requirement or credit check to get a federal Stafford loan.|
“I need more than the maximum Stafford loan.”
|Ask the college if it has any federal Perkins loans or other types of aid, including grants and scholarships, for students like you.|
“The school has no Perkins funds available to supplement my Stafford loan.”
|If you have good grades and there is a remote chance you might someday be a teacher, you can get a federal TEACH Grant – which is actually a type of Stafford loan.|
“I don’t qualify for a TEACH grant.”
|Most parents can get a federal PLUS loan (at a fixed rate of around 8%) for any costs not already covered by grants and your own loans.|
“My parents don’t want to borrow.”
|Offer to split the cost of repaying a PLUS loan with your parents, and put it in writing. If they have good credit, another option is for them to cosign a private loan for you – this may help you get a good interest rate, but is still riskier for both you and your parents than federal loans.|
“My parents don’t want to put their income information on the FAFSA.”
|There is no federal requirement to fill out a FAFSA to get a parent PLUS loan, although some colleges require it. Contact your financial aid office to learn about your college’s policy and how to proceed.|
“My parents were denied a PLUS loan because they were delinquent on their mortgage. They tried two different lenders.”
|If your parents have serious credit problems and can’t get a PLUS loan, the financial aid officials at your school can double your eligibility for federal Stafford loans. If your new undergraduate Stafford maximum of $46,000 is still not enough, consider other ways to reduce costs, including other schools.|
“I can’t apply for federal aid because I’m not in contact with my parents.”
|Talk to the financial aid officials at your college. Depending on your situation, they may be able to override the requirement to provide your parent’s financial information.|
Schools often have separate preferred lender lists for each type of loans, i.e., Stafford, PLUS, Private/Alternative. Schools should recommend lenders for each type of loan that offer the best terms, rates, and service to students using each particular list. Schools should not recommend lenders because they offer the best payments and perks to the school or the best terms and rates for students taking out other types of loans. Be wary of preferred lenders which are selected for reasons that are not based on the best interests of the students using the particular list.
If your school takes payments or perks from lenders, that's a sign that the school's preferred lenders may be preferred for the school or financial aid officials, but not necessarily the best lenders for you.
UIS does not have a preferred or recommended lender list. We will process any FFELP loan request from you expeditiously with the lender of your choice.
Compare the terms, interest rates and discounts offered by lenders both on and off your school's preferred lender lists. Shop wisely. Use the internet as a resource, but be careful about the kind of information you disclose. Speak to older students who have been through the process and ask them about their experience.
The federal government sets the interest rate for certain types of loans, including Stafford and PLUS loans. That rate, however, is really a maximum rate. Private lenders who offer these loans may offer interest rate discounts, principal reduction and other borrower benefits. Sometimes, these discounts are available only after the borrower makes a certain number of consecutive, timely payments or if the borrower agrees to automatic debiting of loan payments from a bank account.
The best benefits and discounts are those that are automatic, rather than contingent on a certain number of consecutive timely payments. Historically, only a small percentage of borrowers end up qualifying for the discounts that are contingent on a certain number of consecutive, on-time payments. In general, rate discounts are more valuable when they begin early in the life of the loan, and less valuable when they begin later in the life of the loan.
Sometimes lenders waive origination fees and/or guarantor fees. You should factor all of these benefits in when assessing what the loan will ultimately cost you. Consider using on-line student loan discount analyzers or calculators that enable you to translate loan terms and borrower benefits into interest rate deductions.
Many borrowers do not receive those benefits or rate discounts that are contingent on completing a certain number of consecutive timely payments. Ask your lender what percentage of borrowers who took out the same type of loan actually qualified for those discounts. Also, find out whether you will lose the discount if you miss a payment sometime after you qualify for the discount.
Many lenders enter into agreements to sell loans to other lenders. Sometimes, the lender already has an agreement in place to sell your loan. Ask the lender if that is the case.
Some benefits and rate discounts offered by the original lender terminate when the loan is sold. Insist that your lender confirms the benefits and discounts in writing, and provides other assurances that the benefits and discounts will continue if the loan is sold.
Lenders promote their products by advertising "as low as" interest rates, but the "as low as rate" may not be the rate that you will ultimately receive. Often, very few students actually qualify for the "as low as" rate. When you are shopping for a loan, ask your school or lender how many students actually receive the "as low as" interest rate, what is the range of interest rates that students at your school have received, and what interest rate will you likely receive based upon your individual and family circumstances.
In some cases, a lender may advertise one interest rate, without making it clear that the interest rate may increase at some point in the life of the loan. Be sure to read all of the information on interest rates carefully to determine whether a loan's interest rate is fixed or variable, i.e., it may increase during the life of the loan. The interest rates on private/alternative loans are often variable, while the interest rates on federal loans (Stafford, PLUS and Perkins) are fixed. This is an important reason why you should exhaust all your federal loan options before considering taking out a private/alternative loan. As explained above in no. 2, some lenders will actually reduce your interest rate if you sign up for automatic debiting or if you make a certain number of consecutive, on-time payments.
Find out when you will be required to start paying back your loan. For some loans, such as PLUS loans, repayment may begin while you are still in school. Other loans' repayment periods may begin after a "grace period" following graduation.
Loans also vary with regard to when interest begins to accrue. Some loans, such as unsubsidized Stafford loans, accrue interest while you are in school. Others, such as subsidized Stafford loans and Perkins loans, either do not accrue interest while you are in school or may be subject to deferment, in which case interest may not accrue while you're in school.
Many students are surprised by how much they will ultimately pay to repay their loans. Before you borrow, figure out how much you will have to pay in total to pay off your loan. To determine the total cost of the loan for fixed rate loans, ask your lender what your monthly payments will be, and multiply that number by the number of payments in your repayment period. For variable rate loans as is common among private/alternative loans, do the calculation based upon a projected monthly payment. However, understand that interest rates are likely to increase during the life of your loan, so your total cost is likely to increase significantly as well.
A typical repayment period for a student loan is ten years from when repayment begins. Find out precisely how long the repayment period is, and ask whether you will face a penalty if you choose to repay the loan before the end of the repayment period.
"Bear in mind that you may be able to consolidate your student loans down the road. Consolidation may enable you to lower your monthly payments by extending the period over which you will be repaying your loans. However, extending the repayment period increases the total amount of interest paid over the life of your loan, increasing the loan's overall cost .
Some lenders impose stiff penalties on borrowers who miss payments or pay late. Find out what those penalties are before your choose a loan.