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U.S. Students - U.S. Federal Loans

The Student Funding Service, c/o The Base, A-Floor, University House deals with pre and post entry administration relating to U.S. students applying for U.S. federal loan (Title IV) funds at both Undergraduate and Postgraduate level.

Student Funding Service staff are individually authorised, on behalf of "The University of Lancaster," a foreign school recognised by the U.S. Department of Education, to access official systems and participate in the U.S. Government student loans system.

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NB Note:

The passing of the U.S. Health Care and Education Reconciliation Act of 2010 (HCERA) means that from July 1, 2010, all new Stafford, PLUS, and Consolidation loans for eligible U.S. students attending Lancaster University, U.K, can only be made under the William D. Ford Federal Direct Loan (Direct Loan) Program, rather than the the U.S. Family Federal Education Loan Programme - FFELP. This means the U.S. Government, rather than private lenders, provide these funds to students through Lancaster University. Students may, depending on assessments of loan eligibility and amounts, be able to take out Direct PLUS Loans on top of Direct (subsidised and unsubsidised) loans.

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The guidance and FAQ's below were last updated on 2nd August 2010 to reflect changes associated with the introduction of Direct Loans for students commencing study in Oct 2010 onward and may be subject to change. Please refresh this page for the latest version.

Overview US Direct Loans

Overview US Direct PLUS Loans

1) How do I apply for a US Direct (Stafford) loans?

For applications for 2012/2013 apply before 30th June 2013.

The process is:-

 
a) You complete a free application for federal student aid (FAFSA) on-line and receive a Federal Student Aid PIN.

b) Once completed you will receive an electronic version of your Student Aid Report (SAR)

c) Complete our cost of attendance (COA) calculator (FAQ4) and email it to us (FAQ4)

The calculator adds the different costs you will face and subtracts estimated family contribution(EFC) and expected financial aid(EFA) to give educational financial need(EFN) and how this splits into subsidised/unsubsidsed/plus loans.

d) Our School (Lancaster University) will use the information you provide on your FAFSA application combined with DIRECT loan scheme criteria (FAQ3) and the COA data to approve the correct loan amounts for which you qualify.

Our school uses the U.S. Government central processing (CPS) and common origination and disbursement system (COD) and guidance (IFAP) to do this.

The amount you borrow in DIRECT Loans is usually split into DIRECT subsidised and DIRECT unsubsidised loan amounts. You may be entitled to borrow extra amounts up to your cost of attendance via DIRECT PLUS loans (DIRECT Parent PLUS for Undergraduates and DIRECT Graduate PLUS for Postgraduates). You should take out the direct loans before the PLUS loan as they are a cheaper form of borrowing.

The case studies in FAQ4 provide an example of determining what level of direct (subsidised and unsubsidised) and PLUS loans you'll be entitled to.

e) Once we have received and reviewed the COA file we will email you to request you visit www.studentloans.gov to

• apply for your PLUS Loans Credit Check (if you are taking this loan type out)
• complete master promissory notes (e-MPNS)
• complete entrance counselling

f) The electronic Master Promissory Note (e-MPN) is the legal document through which you promise to repay your DIRECT Loans and any accrued interest and fees to the Department. It also explains the terms and conditions of your loans.

g) Entrance counselling (FAQ7a) must also be completed to help you be fully aware of your loan commitments before we approve your application.

h) After you have been accepted by our school and your student loans have been set-up by the Student Funding Service (SFS) we will issue you with an official "Notification of Student Loan letter" to use for VISA application purposes. This letter has been approved by the UKBA and only the original issued and signed by SFS staff will be accepted by them. (See the last worksheet in the COA calculator for an example)

The letter will detail the loans funds available to you and the disbursement dates. UK Immigration Visa guidance (Tier IV) states that for students applying from overseas, the loan funds must be available to the student before he/she travels to the United Kingdom, unless that loan will be an academic/student loan from his/her countries national Government and the loan will be released to the student by his/her national Government or via his/her Tier IV sponsor on arrival in the UK. The above letter will therefore be proof that you will have the necessary student funding to enter the UK.

i) When you arrive in the U.K. and register at our school on the specified degree programme we confirm this registration (using CORA) to the U.S. Government (and any PRIVATE loan provider). We are also required to complete regular attendance reporting and ensure you make satisfactory academic progress. (SAP - FAQ 7b)

j) We request approved DIRECT Loan funds in a minimum of 3 termly amounts. These are remitted to our School's dollar account from the U.S. Goverment grant system.(G5) Once the amounts for University charges have been deducted (e.g. fees, accommodation etc) the balance is paid electronically to your bank account (by BACS) if they are DIRECT federal loan funds. If a DIRECT Parent PLUS loan the U.S. Government requires the school pay balance of loan funds to the parent of the student, rather than the student directly.

k) You must complete exit counselling before we will release the final instalement of your DIRECT loan in your final year to you. (FAQ7b)

2) What type of DIRECT loans are available?

There are two main types of DIRECT (Stafford) loans, these are:-

3) What is my initial loan limit - based on the scheme eligibility criteria?

The initial loan limit depends on your level of study, year of study and whether you have dependant or independent status. Rates are subject to annual revision.

How do I work out if I am dependent or independent?

If you can answer "yes" to any one of these questions, then you are deemed INDEPENDENT.

• Will you be at least 24 years old by December 31 of the award year?
• Will you be working on a master’s or doctorate program?
• Are you married (students who are separated but not divorced should answer "yes")?
• Do you have children who receive more than half of their support from you?
• Do you have dependents (other than you children or spouse) who live with you and who receive more than half of their support from you now and through the award year?
• Are you an orphan or ward of the court or were you a ward of the court until age 18?
• Are you a veteran of the US Armed Forces?
• Active Duties in US Military?

The total debt you can have outstanding from all DIRECT (Stafford) Loans combined is:

If you discover that the amount you are entitled to receive from a DIRECT (subsidised and unsubsidised) Loan is not sufficient to support your cost of attendance (COA), you will need to consider taking out a DIRECT PLUS loan. If this is still insufficient you may consider a private loan/lender.

4) What is my actual loan limit - based on (actual) cost of attendance?

Your initial loan limit given by the scheme eligibility (see FAQ3) is usually below your actual cost of attendance (COA). The following spreadsheet allows you to calculate a COA, so that you will know whether the DIRECT loan (subsidised + unsubsidised) is sufficient or whether extra amounts (e.g. from a DIRECT PLUS loan) might be required.

It adds the different costs you will face (E.g. tuition fee costs, accommodation, food, and travel etc) and subtracts estimated family contribution(EFC) and expected financial aid(EFA) to give Educational Financial Need(EFN). The EFN is then compared to the allowed DIRECT Loan subsidised and unsubsidised scheme limits (for independent or dependant students at undergraduate or graduate levels). If it exceeds them you can borrow the maximum applicable amount. We will also approve a DIRECT PLUS loan (should you wish to apply for one) up to the calculated cost of attendance. (COA)

Click here to download the Cost of Attendance (COA) calculator

Save this file to your desktop, add your details, save, then send it to: studentfunding(at)lancaster.ac.uk.

In the above email address please replace (at) with symbol @ - this helps us reduce spam.

Click here for case studies These show some worked examples of how the Educational Financial Need (EFN) is calculated and used to determine level of DIRECT (subsidised / unsubsidised) and PLUS loan.

Please ensure you are fully aware of all costs so that you are able to make adequate financial provision from U.S. Government loans and/or other sources.

5) What is the Lancaster University school name & code?

Our official name is "University of Lancaster"

Federal School code: G09444

OPEID (Office of Postsecondary Education Identifier) Code: 00944400.

6) Can you recommend a private loan provider?

No, it is your responsibility to identify a potential lender if your Federal DIRECT / PLUS loans do not adequately cover your cost of attendance (C.O.A).

7) How and when will my loan funds be paid, are there any conditions?

Once the due process has been completed and you have arrived at and registered with our school the U.S. Government will allow the University to draw down federal funds electronically to our bank account.

We will pay University charges (e.g. for tuition fees, accommodation etc) due and transfer any balance remaining to your bank account (unless the loan is a DIRECT Parent PLUS loan) in termly amounts on the specified dates providing the conditions below have been met.

Where there are no debts owed the cashiers office will arrange for the funds to be sent electronically to a UK account you nominate within 3-5 days. To nominate a UK account for direct credit purposes please see: www.lancs.ac.uk/sbs/funding/account.htm

Disbursement Frequency - U.S. Federal loans are disbursed in 3 equal termly instalments over the course of the academic year.

Loan Disbursements Conditions:

a) Entrance and Exit counselling

It is a U.S. Government legal requirement that applicants complete entrance counselling prior to receiving a loan and exit counselling when all loan disbursements have been made.

The University will not disburse the first instalment of loan funds until entrance counselling has been completed and we have received an email from the website below, confirming it has taken place. The purpose of entrance counselling is to advise you on the different types of loans available, repayment methods/schedules as well as making sure that the applicant is aware of the legal requirements of participating in the programme.

The University will not disburse the last instalment of loan funds until exit counselling has been completed and we have received an email from the website below, confirming it has taken place. The purpose of exit counselling is to advise students of the methods of repayment, deferment and the consequences of defaulting.

To complete entrance or exit counselling please visit the U.S. Government students loans website: https://studentloans.gov/myDirectLoan/index.action

b) Satisfactory Academic Progress (SAP)

U.S. Federal regulations require that a student must be enrolled in an eligible educational programme and making satisfactory academic progress in order to be eligible to receive federal aid (Title IV) funds from the U.S. Department of Education. At the end of each term you must download a SAP confirmation sheet, have it signed by your department or supervisor and submit it to the: Student Funding Advisor (U.S. Loans), Student Funding Service, c/o The Base, A-Floor, University House.

Please note that loan funds for the following term will not be disbursed without this SAP form having been signed and submitted. For the full SAP Policy click here.

8) What if I need to take time out or withdraw from my studies?

Unless this is a short term period of authorised absense (leave of absence) any period of time out will affect payment of further awards. You should notify this office immediately of any intention to either take time out or withdraw from your studies.

The University Return of TitleIV funds policy can be found here, please read this in full.

9) Deferring existing loan repayments

During Postgraduate study you may want to defer re-payment of a loan which you arranged at Undergraduate level. Deferment forms supplied by your lender should be handed into the Student Funding Service, c/o The Base, A-Floor, University House. These will be completed and posted to the relevant lender.

10) Contact Us

If you need more help please contact: Student Funding Adviser, c/o The Base, A-Floor, University House, Lancaster University, LA1 4YW.

E-mail: studentfunding(at)lancaster.ac.uk or tel +44 (0)1524 594848.

11) Further web resources

http://www.fafsa.ed.gov - Free Application for Student Federal Aid

https://studentloans.gov/myDirectLoan/index.action - Student Loans
http://studentaid.ed.gov/students/publications/student_guide/index.html - E-Guide

http://studentaid.ed.gov/students/attachments/siteresources/Loan_Programs_Fact_Sheet_04_2009.pdf - Student Loans fact sheet