Loans
Loans
Policy
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Document Number: SFS--119 Revision #: 1.0
Document Owner: Executive VP Date Last Updated: 08/17/2012
Primary Author: Executive Director of Enrollment Services Status: Approved
Date Originally Created: 11/30/2011
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General Description
Description: Information about student loans relative to student financial aid.
Purpose: Delineation of policy.
Scope: Students
Responsibility: VP of Business and Finance
Student Financial Services
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Requirements
Relevant Knowledge: In order to comply with this policy you should know:
Current University policy
Federal statutes
Local statutes
Standard company policies
Standards of good practice
State statutes
Terms and Definitions: Additional training
Corrective Action
Loss of privilege, general
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Policy Provisions
1. Loans
Loans are often included in the financial assistance award package. Loans allow students to defer the cost of their education by borrowing now and paying later. Cumberland University is a borrower-based institution.
1.1 Federal Direct Stafford Loans
Federal Direct Stafford Loans allow students to borrow money for college tuition and expenses. Subsidized Stafford Loans are awarded to eligible students, and no interest accrues while the student is enrolled at least half time. Unsubsidized loans are given to students who do not meet the need-based criteria, and interest accrues while the student is in school.
1.2 The Federal Direct Parent Loan for Undergraduate Students (PLUS)
The Federal Direct Parent Loan for Undergraduate Students (PLUS) a loan available to parents with dependent children in college. Eligibility is not based on need but a credit check is required. Parents may borrow the cost of attendance minus any other financial aid received. Payment on the interest and principal usually begins within 60 days after the disbursement of the loan.
1.3 Federal Perkins Loans
Federal Perkins Loans formerly National Direct Student Loans, are low-interest (5%) loans available to undergraduate students who demonstrate financial need. Repayment and interest charges begin after the student drops below half-time status. All Perkins Loan recipients must participate in an exit interview if they do not plan to return to Cumberland the following academic year. Pell Grant recipients receive priority in Perkins Loan awards.
1.4 Alternative Loans
Alternative Loans are available for students from a number of different lenders. These loans generally do not require the completion of the Free Application for Federal Student Aid (FAFSA). They may be based upon ability to repay and may carry a higher rate of interest than Federal Direct Stafford Loan Program.
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Performance Evaluation
Performance Metrics: Compliance with standard policy and procedure
Compliance with federal mandate
Consequences: Further training
Loss of privileges
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Subject Experts
The following may be consulted for additional information.
Executive Director of Enrollment Services
VP of Business and Finance