Discover the ins and outs of student loans.
Even though Monroe Community College offers an affordable education, you may need to apply for a loan to help pay for your tuition, books, food and other necessities. There are several loan programs available, which can help fund all your educational needs.
Before you apply for a loan, it’s important to know that loans need to be paid back and you’ll also be charged interest on the money you borrow.
MCC recommends a Direct Loan from the federal government, which offers low interest rates to students and their families.
MCC federal school code: 002872
MCC TAP school code: 2180
First time applying for a loan?
Federal Direct Stafford Loan
The William D. Ford Federal Direct Stafford Loan is a loan for students made through the U.S. Department of Education. Direct Loans are either subsidized or unsubsidized.
- A subsidized loan is awarded on the basis of financial need. If you qualify for a subsidized loan, the federal government pays interest on the loan until you begin repayment.
- An unsubsidized loan is not awarded on the basis of need. If you qualify for an unsubsidized loan, you’ll be charged interest from the time the loan is disbursed until it is paid in full. You can choose to pay the interest or allow it to accumulate. If you allow the interest to accumulate, it will be capitalized – meaning, the interest will be added to the principal amount of your loan and will increase the amount you have to repay. If you pay the interest as it accumulates, you’ll repay less in the long run.
If you’re receiving Federal Title IV Financial Aid, you may attempt up to a maximum of 150% of the credits necessary to complete your degree/certificate program. For example, for a program requiring 64 credits for graduation, you may attempt up to 96 credit hours. When your attempted hours are equal to or exceed 150% of the credits required for the degree/certificate, you’re no longer eligible for Federal Title IV Financial Aid.
If you’re enrolled at least on a half-time basis, six or more credit hours, and if you’re a dependent undergraduate student, you can borrow up to:
- $5,500 if you’re a first-year student (0 – 23 credits earned)
- $6,500 if you’re a second year student (24+ credits earned)
If you’re enrolled at least on a half-time basis, six or more credit hours AND you are an independent undergraduate student or a dependent student whose parents are unable to qualify for a PLUS loan, you can take out an additional $4,000 unsubsidized loan annually.
NOTE: The amounts above are the maximum yearly amounts you can borrow in both subsidized and unsubsidized Direct Loans. However, you cannot borrow more than your cost of attendance minus any other financial aid for which you're eligible. This means that you may receive less than the annual maximum amounts.
The total debt you can have outstanding from all Direct Loans and Federal Family Education Loans combined is:
- $31,000 as a dependent undergraduate student (no more than $23,000 of this amount may be in subsidized loans)
- $57,500 as an independent undergraduate student (no more than $23,000 of this amount may be in subsidized loans)
The current interest rate for the Federal Direct Stafford Loan can be found on the calculators section of the Federal Student Aid website. There is also a 1.0% fee that will be deducted from each disbursement of your loan.
To apply for a Federal Direct Student Loan, you must first file a Free Application for Federal Student Aid (FAFSA). All students will be packaged with the maximum subsidized and unsubsidized loans that they are eligible for.
If you’re taking out a Federal Direct Student Loan at MCC for the first time, you’re required to complete Loan Entrance Counseling, which explains the obligations you agree to meet as a condition of receiving a Direct Loan. You’ll learn about managing your spending, making a repayment plan and other important topics.
Once the Loan Entrance Counseling session is completed, our Financial Aid Office will receive an electronic confirmation. You should print the confirmation form at the end and keep it for your records. If you do not complete the Loan Entrance Counseling session, you will NOT receive your Direct Loans.
Also, if you’re taking out a Federal Direct Student Loan for the first time, you’re required to sign a Master Promissory Note (MPN). By signing the MPN, you agree to the terms and conditions of the loan. Signing the MPN is done electronically using your FSA ID. Our Financial Aid Office will notify you if you need to sign a MPN.
Complete the Loan Entrance Counseling and sign your Master Promissory Note at the Federal Student Aid site.
MCC strongly recommends that you only accept the loan amounts that you need in order to financially support the completion of your coursework.
The U.S. Department of Education will pay your student loan funds through MCC. Your loans will be disbursed in two equal installments, one approximately 30 days after the first day of classes AND once your attendance has been reported for those classes.
The second disbursement will be at the midpoint of the semester, as long as you are attending classes. If you’re a first-year, first-time borrower, your first disbursement will be delayed until 30 days after the start of the loan period.
Your loan money must first be applied to your school account to pay for tuition, fees and other school charges. If loan money remains, you can receive the funds directly in your bank account by signing up for E-Refunds through the Student Accounts Office. If you do not sign up for E-Refunds you'll receive a paper check in the mail, but please note the paper process takes much longer than E-Refunds.
After you graduate, leave school, or drop below half-time enrollment, you have six months before you begin repayment of your federal student loans. This is called a grace period. After you leave school or drop below half-time enrollment, you will receive information about repayment and will be notified of the date repayment begins. However, you are responsible for beginning repayment on time, even if you do not receive this information.
For more information on repaying your student loans, visit the repaying section of the Federal Student Aid website. In addition, the repayment plans are further explained during your online entrance and exit counseling sessions.
For more information on the Federal Direct Student Loan program, visit the Federal Student Aid site.
Federal Direct Parent Loan for Undergraduate Students (PLUS)
Families who need additional money to pay for an MCC education may apply for the Federal Direct PLUS program, made through the William D. Ford Federal Direct Student Loan Program. This loan allows parents to borrow money from the U.S. Department of Education to help pay for their child's educational expenses.
Parents of dependent students enrolled at least on a half-time basis, six or more credit hours, can apply for a Federal PLUS loan through the Federal Direct Loan Program. Parent borrowers must have good credit histories or an endorser: someone willing to repay the loan if the parent borrower fails to do so.
The yearly limit on a PLUS loan is equal to the student's cost of attendance minus other financial aid received. The interest rate is set by the government each year. Borrowers are notified of interest rate changes each year on July 1. There is up to a 4% fee charged by the government for processing the loan. This fee is deducted from each disbursement of the loan.
PLUS funds are disbursed to the school in two equal installments, one at the beginning of the loan period and one at the midpoint of the loan period. The funds are first used to pay school charges and any remaining funds are refunded to either the parent or the student, based on an authorization completed by the parent.
Repayment of PLUS loans begins 60 days after the loan is fully disbursed. There are three different repayment plans: standard, extended or graduated. More information on these plans will be sent to parent applicants.
NOTE: You must accept, adjust or decline every student loan you’re offered. You can do this through the MCC Banner Student Self-Service System.
Private educational loans
Banks and other financial institutions offer private institutional loans to help with the cost of your education. These loans are not guaranteed student loans and are generally based on income and credit history. Interest rates and fees are set by each individual lender. Most students would be required to have a cosigner to obtain one of these private loans.
If you’re considering taking out a private educational loan, you should research each individual program carefully. These loans are generally at a higher interest rate and you should consider them only as a last alternative, after you have explored all federal aid options. To explore some of your Private Loan options, please visit the FASTChoice website.
For more information watch our Financial Aid Videos: