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Student Loans

Student Loans are a form of financial aid that requires repayment of the funds received, usually with interest. Some loans may be in either the student's or the parents' name. All loans require a promissory note, and some require a separate application.

Federal Stafford Loans

There are two types of Federal Stafford Loans: subsidized and unsubsidized. Subsidized Stafford Loans are based on financial need as determined by the FAFSA application. Both loans carry a fixed interest rate of 6.8%.

Stafford Loans may be charged a 0 to 3% origination and guarantee fee deducted when funds are disbursed. If a Stafford Loan appears on your award notice, you should anticipate receiving 97 to 100% in net funding. However, different lenders charge different amounts. Lincoln College is pleased to recommend the following commonly used lenders that do not charge an origination fee for the processing and origination of Federal Stafford Loans.

Sallie Mae Education Trust - Lender Code: 802218

National City - Lender Code: 808942

Students must complete Entrance Counseling as a Federal requirement before receiving Stafford loan funds. Entrance Counseling may be completed online at www.mappingyourfuture.org. Contact the Financial Aid Office for more information.

Subsidized Stafford Loans:

Eligibility for a subsidized Stafford Loan is based on financial need as determined by the FAFSA form.

Subsidized Stafford Loans allow for a deferment of principal payments while the student is enrolled as at least a half-time student in a degree-seeking program.

Students are allowed a six-month grace period upon leaving college before making payments on principal and interest of the loan. Interest subsidies while the student is in school are paid by the federal government.

Unsubsidized Stafford Loans:

Unsubsidized Stafford Loans allow for deferment of principal payments while the student is enrolled as at least a half-time student in a degree-seeking program.

Students are allowed a six-month grace period upon leaving college before making payments on the principal of the loan.

Important: With the Unsubsidized Stafford Loan, interest subsidies while the student is in school are assumed by the student borrower, not the federal government. This means that interest will accrue on the loan during the in-school and 6-month grace period. Students are strongly encouraged to make monthly interest payments on the unsubsidized Stafford Loan while in school. Deferring the interest allows it to be capitalized, and this accrued amount will be added to the loan principal when repayment begins.

Federal Perkins Loan
The Financial Aid Office awards Federal Perkins Loans to students based on a combination of significant need as demonstrated on the FAFSA form and the availability of funds.

The interest rate for the Perkins Loan is 5%, and no interest or principal payments are due until 9 months after a student graduates (or drops below half-time status).

Federal PLUS Loans
PLUS Loans are borrowed by parents to assist in paying college costs for their children. The PLUS Loan carries a fixed interest rate of 8.50%. Parents may borrow up to the cost of education minus all other financial aid being received by the student.

A PLUS Loan amount appearing on a student’s financial aid award notice is only a recommendation. A pre-application is available in the Financial Aid Office and also included in the financial aid packet to initiate processing.

PLUS Loans are charged a 3% origination fee when funds are disbursed. Students should anticipate receiving 97% in net funding.

Alternative Loans
Learn more about alternative loans.

Updated 5/1/08

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