Federal Loans

Federal Aid Programs

Saybrook University participates in the William D. Ford Federal Direct Loan Program, in which borrowers obtain loan funds directly from the US Department of Education. The Federal Direct Unsubsidized Loan and the Federal Direct Grad PLUS Loans both fall under this program. The Department of Education acts as the lender and loan funds are delivered directly to students’ accounts through the Business Office. For more information, please go to: http://www.direct.ed.gov/


Federal Direct Subsidized Stafford Loans are no longer available for graduate and professional students effective July 1, 2012. The Budget Control Act of 2011 passed by Congress and signed by President Obama eliminates the subsidy for graduate and professional students and moves this funding to Pell Grants for undergraduate students. As a result, graduate and professional students will be awarded Federal Direct Unsubsidized Loans. The annual limit, however, remains unchanged at $20,500 and the aggregate loan limit for graduate students remains at $138,500.

Termination of Direct Loan Borrower Repayment Incentives

Effective, July 1, 2012, the up-front rebate that has been provided to Direct Loan borrowers at the time of their loan disbursement will no longer be offered.

Federal Direct Unsubsidized Loans

Direct unsubsidized loans accrue interest while you are enrolled as long as you are enrolled at least half time status. You can choose to pay the interest each month while in school, or allow the interest to accumulate. The interest rate is fixed at 6.8%. Interest accrues from the time of disbursement and is added to the principal one-time upon commencement of repayment. The payment of interest can be deferred until the end of the grace period. The Unsubsidized Direct Loan has a 6-month grace period. To apply for an unsubsidized loan go to: www.studentloans.gov.

Federal Grad PLUS Loans

The Grad PLUS Loan is designed to help graduate students meet their educational costs. Graduate students may borrow up to the cost of education minus any other financial received. Grad PLUS Loans are available to borrowers who do not have adverse credit histories. The interest rate is fixed at 7.9% and repayment begins 60 days after the loan is fully disbursed. Graduate students do not enter repayment while enrolled at least half time status. To apply for an unsubsidized loan go to: www.studentloans.gov.

Understanding Credit

Your credit history is the most important factor used in determining your eligibility for a loan. Your lender reviews the credit report to determine if there are any indications of bad credit. If you have adverse credit, even a credit-worthy cosigner may not be sufficient in securing a Direct Graduate PLUS Loan or an Alternative Private Loan. We recommend that you obtain a copy of your credit report as soon as possible to get a full understanding of your credit-worthiness and have time to correct any errors. To receive a free copy of your credit report, visit www.annualcreditreport.com or call them at (877)322-8228. You may receive a free credit report from each of the three major reporting agencies: Equifax, Experian, and TransUnion, once every 12 months.

Federal Direct Entrance Interview

The US Department of Education requires first-time borrowers in the Federal Direct Stafford Loan Program to complete an online loan entrance counseling session before loan funds will be credited to your account. The session provides you with useful tips and tools to develop a budget for managing educational expenses and understand loan responsibilities. Students are required to complete an entrance interview for the Federal Direct Stafford Loan and one for the Federal Direct Grad PLUS Loan. The session takes 20 to 30 minutes to complete. The website address is: www.studentloans.gov

Private/Alternative Loans

Students are always encouraged to fully utilize all federal student loan programs first as they offer better consumer protection for borrowers. If you choose not to apply for federal aid, there are programs that offer alternate loan resources. Students who are receiving financial aid can also utilize these programs to finance all or part of their calculated expected family contribution (EFC). Borrowers must be credit-worthy to participate in these programs. However, a credit worthy co-signer can be used for students who are not credit-worthy by program guidelines.

Under recent revisions to the Truth in Lending Act (TILA), a lender will be required to provide you with disclosures at several points during loan application and consummation. You will also be required to submit to the lender Private Loan Self-Certification Form as part of the application (which will be provided in the lenders’ material).

Saybrook University does not have a Preferred Alternative Loan Lender Relationship with any private/alternative loan program. You have the right to choose any lender you want who provides private/alternative student loans. Saybrook University legally cannot recommend any one lender to students.

Other Federal Benefit Programs

Additionally, some students may be eligible for education benefits from the following federal programs:


Please contact Financial Aid with any questions.

Financial Aid/Student Accounts: