For many Emory University students, loans are an important way in which they pay for a portion of their educational costs. Loans are available from two primary sources:

1. Federally sponsored loan programs such as the William D. Ford Federal Direct Loan Program, which includes the Stafford Loan, and the Graduate PLUS Loan.
2. Private (alternative) loan programs.

The Office of Financial Aid will serve as the intermediary between you, the student and the lender(s). The office will transmit your loan information electronically and will receive the disbursement of your loan funds on or after the schedule disbursement dates. (Disbursement dates are available in the financial aid section of the OPUS Student Center and are also provided to borrowers by lenders as part of loan disclosure statements.)

Federal Direct Loan Borrowing

The lender is the U.S. Department of Education, and eligibility requires U.S. Citizenship or Permanent Residency, and at least half-time enrollment. Details on these loan programs can be found under the ‘Types of Aid’ link on the left of this page. Maximum federal loan eligibility should always be exhausted before borrowing from a private loan program.

Federal Direct Loans include the following:

1. Direct Unsubsidized Stafford Loan is a non-need based loan. The government does not pay the interest while the student is enrolled. The student has the option to either pay the accruing interest monthly or allow the interest to capitalize (to be added to the principal). Either way, required payments do not begin until 6 months after graduation or 6 months after the student drops below half-time enrollment. Unsubsidized Stafford Loans are not based on financial need and therefore may be used to finance the family contribution. See Instructions for applying.

2. Direct PLUS Loan for Graduate Students is a credit based loan with a fixed interest rate. This loan is for graduate or professional students to meet educational cost after borrowing full Stafford eligibility. See Instructions for applying.

Private (alternative) Loan Programs

Private educational loans are consumer loans that should only be considered after exhausting full eligibility from the Federal Direct loans available. Selection of a private lender requires careful consideration and planning.

The items below may be important factors in selecting a private loan lender:

1. Interest Rates and Terms—Some loan rates on some loans are tied to LIBOR, London Interbank Offered Rate, while others are tied to the U.S. prime rate. The term of repayment may vary from one program to another.

2. Borrower Benefits – These are the financial incentives provided by lenders to reduce the price of your loans over time. There are two categories of these benefits:

• Front-end Benefits –These primarily include origination fees charged at the time the loan is processed.

• Back-end Benefits – These incentives may include an actual reduction in the interest rate or a rebate on the principal amount. The following questions may be useful in a lender comparison:

1. What is the actual (calculated) benefit and how much money will you save?
2. Is it easy to qualify for the savings?
3. Does the benefit begin immediately without restrictions or does it go into effect after a specified number of consecutive on-time payments?
4. Are you required to sign up for ACH (automatic withdrawal or “auto-debit” from your savings or checking account) in order to qualify for the benefit?
5. How do you lose the benefit (thereby losing the savings) and once lost, can you regain the benefit?

3. Customer Service – It is important that you select a lender with a demonstrated record of excellent customer service. Educational borrowing is a long-term commitment and the service provided by the lender is an important factor in that relationship.

In an effort to assist students and families in choosing a lender, the Office of Financial Aid has compiled a list of institutions we consider to offer competitive products, solid customer service, electronic payment of loan funds and a variety of savings programs during loan repayment. The Office of Financial Aid surveys lenders annually to provide the latest information regarding products and benefits. The information presented in our Lenders Lists was compiled from information received from the lenders as of February 2011 and is available in the Office of Financial Aid upon request. Reasons for selecting a particular lender will vary from person to person. This list should only be used as a guide or starting point for analysis. Some choose a lender based on name recognition, immediate benefit of lower front end fees, or the long-term advantage of back end benefits. You should review each loan disclosure statement (mailed to you after the loan has been approved). You should also confirm that there have not been any changes and that the terms and benefits are consistent with the information provided to Emory University.

Please note that you are not required to use any of these lenders – the choice of lender is yours.The Office of Financial Aid will process your loan with any lender you choose. Further, the list of lenders is not in any order of preference. Choose your lender carefully with the intent that you will remain with that lender throughout your studies at Emory.

The U.S. Congress recently mandated that private loan lenders collect a self-certification form before disbursing a private educational loan. The Applicant Self-Certification Form contains both the form and the instructions on where to locate the required financial aid information for Section 2. The form must be returned back to the lender and should not be submitted to the Office of Financial Aid.