Federal Direct Loans

2019-20

Federal Direct Loans are available to students enrolled at least half-time.

The federal government offers loans with an interest subsidy (subsidized), and without a subsidy (unsubsidized). Borrowers of the Federal Subsidized Direct Loan are eligible for an interest subsidy while they are enrolled in school at least half-time and during their 6-month grace period.

If eligible for a Federal Direct Unsubsidized Loan, you will remain responsible for the interest charge upon receipt of the loan, but may defer payment of that interest until you leave school. Interest that has accrued on the Federal Direct Unsubsidized Loan will be capitalized upon repayment. The interest rates for Federal Direct Subsidized Loan and Unsubsidized Loans disbursed between July 1, 2019 and June 30, 2020 for undergraduate students is a fixed rate of 4.53%. For students enrolled in the Graduate Program, the interest rate will be 6.08% for loans disbursed between July 1, 2019 and June 30, 2020.

There is an origination fee of 1.062% for loans disbursed on or after October 1, 2018-September 30, 2019.   A new rate will be set for loans certified on or after October 1, 2019 and will be in effective from October 1, 2019-September 20, 2020.  Visit the Direct Loan Servicing website for more information.

Borrowers are normally allowed 10 years to repay the loan, making the investment affordable for most students.

Repayment

To understand your repayment responsibilities before you borrow, go to the Repayment Estimator.

Go to the following links to find out about federal loan forgiveness programs:

Grace Period Interest Subsidy

Borrowers of the Federal Subsidized Direct Loan are eligible for an interest subsidy while enrolled at least half-time and during their six month grace period. The subsidy during the grace period had been temporarily removed by the fiscal year 2012 budget bill for loans first disbursed on or after July 1, 2012, and before July 1, 2014.

Loss of Subsidized Loan Eligibility for Graduate and Professional Students - The Budget Control Act eliminated the availability of Federal Direct Subsidized Loans to graduate and professional students effective for loans made for periods of enrollment (loan periods) on or after July 1, 2012 and the availability of certain repayment incentives for loans made on or after July 1, 2012. The annual loan limit for graduate and professional students remains unchanged at $20,500, but this amount will now be limited to Federal Direct Unsubsidized Loans.

 

The Definition of Half-Time Enrollment Status at BVU

Students must be enrolled at least half-time to receive the Federal Direct Loan. See the following for each programs definition of half-time status:

1. Storm Lake Campus Undergraduate Program

  • 6 hours in a semester = 1/2 time status

2. Storm Lake Graduate Program

  • 3 hours in a semester = 1/2 time status

3. Online, Site, and Graduate Programs

  • Undergraduate Program
    • Fall Semester- Combine Terms 1 & 2 (6 hours = 1/2 time status)
    • Spring Semester - Combine Terms 3 & 4 (6 hours = 1/2 time status)
    • Summer Semester - Combine Terms 5 & 6 (6 hours = 1/2 time status)
  • Graduate Online Program
    • Fall Semester - Combine Terms 1 & 2 (3 hours = 1/2 time status)
    • Spring Semester - Combine Terms 3 & 4 (3 hours = 1/2 time status)
    • Summer Semester - Combine Terms 5 & 6 (3 hours = 1/2 time status)

Federal Direct Loan Program

Federal student loans, from the William D. Ford Federal Direct Loan (Direct Loan) Program, are low-interest loans for eligible students to help cover the cost of higher education. Eligible students borrow directly from the U.S Department of Education.

Buena Vista Students that have borrowed through the Federal Direct Loan Program previously and signed a Federal Direct Stafford/Ford Master Promissory Note (MPN) will not be required to sign a new MPN. If you did not borrow the Federal Direct Loan previously and now wish to borrow, go to Studentloans.gov to complete the Federal Direct Loan MPN and entry counseling.

When completing your MPN and entry counseling, you will be asked for your FSA (Federal Student Aid) ID.  If you need a FSA ID, you can create one at studentloans.gov.

Prior Federal Loans and Financial Aid History - Federal Loans that have been disbursed will 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 NSLDS system.

If you currently have a federal student loan and would like to check the interest rate, servicer information, and other financial aid history, go to the National Student Loan Data System (NSLDS) and use your FSA ID to access your information.

Steps To Complete The Process For First Time Borrowers

Entrance Counseling

All first-time borrowers are required to receive entrance counseling before loan funds will be disbursed. This counseling will provide you with your rights and responsibilities as a student loan borrower. To complete this requirement online, please visit Studentloans.gov being sure to request that confirmation be sent to BVU.

Master Promissory Note

As a first-time borrower you will also be required to complete a Federal Direct Loan Master Promissory Note (MPN). The MPN will be used for all Federal Direct Subsidized and/or Unsubsidized Loans that you borrow. You will only need to complete one MPN while enrolled at Buena Vista University.

You will be asked for your FSA (Federal Student Aid) ID when completing the MPN. You can create a FSA ID by going to studentloans.gov.

Federal Direct Loan Master Promissory Notes (MPN) remain valid and on file with the guarantee agency for up to 10 years after the date you executed the note.

To complete the electronic MPN, go to StudentLoans.gov.

A Federal Direct Loan will not disburse until the Master Promissory Note and entry loan counseling have been completed.

Transfer Students

If you have previously borrowed a Federal Direct Loan and completed a MPN at another institution, you do not need to complete a new MPN. However, if you completed a Federal Direct Master Promissory Note (MPN) more than 10 years ago, a new MPN will be required.

Federal Direct Loan Interest Rates disbursed starting July 1, 2019

  • Undergrad Program

Federal Direct Subsidized & Unsubsidized Loans fixed @ 4.53%

  • Graduate Program

Federal Direct Unsubsidized Loan rate fixed @ 6.08%

 

Federal Direct Loan Benefits 

  • Rate Reduction for Auto Payment

Electronic Debit Account (EDA) If you repay your loans through the EDA repayment option, you will receive a quarter point (.25%) discount on your interest while in repayment.

If you need assistance, contact the Office of Financial Assistance at 712.749.2164 or email finaid@bvu.edu.

FSA ID

The FSA ID - a username and password - has replaced the Federal Student Aid PIN and must be used to log in to certain U.S. Department of Education websites.  Your FSA ID confirms your identity when you access your financial aid information and electronically sign Federal Student Aid documents.  If you do not already have an FSA ID, you can create one when logging in to FAFSA.gov, The National Student Loan Data System, Studentloans.gov, and Agreement to Serve (ATS).