If you applied for financial aid, you may have read about loans. A loan is money you borrow and must pay back with interest. If you decide to take a loan, make sure you understand who is making the loan and the terms and conditions of the loan. Student loans can come from the federal government or from private sources such as a bank or financial institution. Loans made by the federal government, called federal student loans, usually offer borrowers lower interest rates and have more flexible repayment options than loans from banks or other private sources. Learn more about the differences between federal and private student loans
Federal Direct Loan Program
All federal Stafford student loans are through the U.S. Department of Education’s (ED) Federal Direct Loan (FDL) program. This means that if you borrow money toward educational expenses, you will make repayment to a federal government servicer instead of a private lender. For FDL information, visit their Student Loans website.
Who is Eligible to Apply for a FDL?
BMCC does not package loans at the time of initial award. Once a student has been issued an Award Letter or an Eligibility Notification from BMCC (via the student's Wolf Web account), the FDL application process can be started. Enrollment of 6 or more aid eligible credits is required.
Types of Loans- BMCC participates in the following Department of Education types of loans:
Direct Subsidized Loans are loans made to eligible undergraduate students who demonstrate financial need to help cover the costs of higher education at a college or career school.
Direct Unsubsidized Loans are loans made to eligible undergraduate, graduate, and professional students, but in this case, the student does not have to demonstrate financial need to be eligible for the loan.
Direct PLUS Loans are loans made to parents of dependent undergraduate students to help pay for educational expenses not covered by other financial aid.
To check per term loan application deadlines or other important dates, visit Financial Aid Dates And Deadlines
Complete the Master Promissory Note (MPN)- Required for First Time Borrowers only.
Complete and submit the Federal Direct Loan Request/Revision Form.
BMCC can only create your loan after being notified by the U.S. Department of Education that an accepted Master Promissory Note (MPN) is on file and the student has completed Entrance Counseling. Check your MPN and entrance counseling status by logging on to your BMCC Student WolfWeb account or https://studentloans.gov.
2. Loan Award: After the Financial Aid Office receives the Federal Direct Loan Request/Revision Form and confirmation of completion of MPN and entrance counseling, the loan will be awarded within 5 business days. The Financial Aid Office will send notification of a revised award letter to the student.
Note: Loans are transmitted to the Department of Education for approval when originated and before the disbursement date. System errors or frequent student changes, may cause delays.
Loans will also be submitted to the National Student Loan Data System (NSLDS), and will be accessible by guaranty agencies, lenders, and schools determined to be authorized users of the data system.
3. Loan Disbursement: The loan net disbursement (term award less origination fee) will be divided over the number of terms of the loan period (or by two for a single-term loan period) and applied to the student's account. Funding will first be applied toward any tuition and fees, or authorized non-institutional charges, that may have accumulated on your BMCC student account. See dates and deadlines for specific loan disbursement schedule.
First-Time Borrowers: Before the first disbursement can be released, federal regulations require BMCC to confirm the student is still eligibly enrolled 30-days into the first term of the loan period. See dates and deadlines for specific loan disbursement schedule.
Single Term borrowers: Federal regulations require that your loan be disbursed in two equal payments. The first disbursement for returning borrowers is made at the same time as other financial aid refunds. The second disbursement is the mid-point of the term. If your enrollment drops below 6 eligible credits before the second disbursement, further refunds will be cancelled for the term. See dates and deadlines for specific loan disbursement schedule.
Loan Limits and Direct Loan Maximum Time Eligibility: These documents contain information on the loan limit amounts (subsidized and unsubsidized) a student may be eligible to receive each academic year and for the duration of their declared degree.
Loan cancellation/reduction: You can cancel or reduce your loan at any time. If you have already received your student loan, it is strongly recommended you speak with a financial aid advisor before cancelling or reducing your loan. Cancelling or reducing your loan can create a balance on your BMCC account, which may impact your ability to register for classes and prevent your from completing your degree. Loan Cancellation Request Form.
4. Exit Counseling: If you have received a subsidized, unsubsidized, or PLUS loan under the Direct Loan Program, Federal regulations require that you complete exit counseling each time you a) Drop below half-time enrollment, b) Graduate, or c) Leave school. BMCC will send you a reminder of this requirement if you drop below 6 credits, leave school, or at the end of each academic year. For more information about the Exit Counseling process, visit https://studentloans.gov/
Private (Alternative) Loans
These loans are nonfederal loans, made by a lender such as a bank, credit union, state agency, or a school. BMCC does not offer private loans. Students wishing to have BMCC certify a private loan must:
- Be enrolled in at least 6 financial aid eligible credits
- Be a degree/certificate seeking student
The Financial Aid Office can only certify up to the unmet need or the cost of attendance. The Financial Aid Office will contact the student before certifying a private loan to ensure understanding of possible Federal Direct Loan Eligibility.
Private loans are not federally guaranteed or governed by the US Department of Education. BMCC does not make lender or loan program recommendations. Borrowers should carefully review terms and conditions, which vary by lender and loan. To be eligible, a student must often have a co-signer with qualifying income, time-on-job, debt-to-income-ratio, and other considerations. In the student's best interest, BMCC's Financial Aid Office generally certifies this type of loan only after the student has exhausted all FDL options. BMCC retains the right to refuse certification based on professional judgment.
Private Education Loan Applicant Self-Certification: Pursuant to Section 155 of the Higher Education Act of 1965, as amended, (HEA) and to satisfy the requirements of Section 128(e)(3) of the Truth in Lending Act, a lender must obtain a self-certification signed by the applicant before disbursing a private education loan. The school is required on request to provide this form or the required information only for students admitted or enrolled at the school.
Additional Information and Resources:
Be a Responsible Borrower - Plan ahead and Graduate with Less Debt.
Ombudsman Group - A neutral, informal, and confidential resource to help resolve disputes about federal student loans.
I3 Group- Free membership program provided by BMCC. The i3 Group is a counseling service that will answer questions as well as assist current and former students with their Federal Student Loans.
How to Repay Your Loans - Understanding how to repay your federal student loans can save you a lot of time and money. The Department of Education has many resources to assist you.