Loan Details

Subsidized/Unsubsidized Stafford Loans

Perkins Loans

Purdue Loans

Graduate PLUS Loans

Health Professions Student Loans

Parent PLUS Loans

Federal Loans: Interest Rate Maximums

Private Loans: Private Loan Vendors

Preparing for Student Loan Repayment

Borrower Rights

Borrower Responsibilities

Consequences of default

Grace period

Repayment

Deferment

Forebearance

Consolidation

Debt Management

Right to Cancel Loans

Subsidized/Unsubsidized Stafford Loans

Stafford Loans are Federal Direct Loans for undergraduate, graduate and professional degree students.

There are two types of Stafford Loans: Subsidized and Unsubsidized. You must have financial need to receive a Subsidized Stafford Loan. Financial need is not a requirement to obtain an Unsubsidized Stafford Loan. The U.S. Department of Education will pay the interest that accrues on Subsidized Stafford Loans during certain periods. The time limits on the Subsidized interest subsidy can be found here.

Eligibility

  • Must be undergraduate, graduate, or professional student enrolled at least half time as a degree-seeking student. Note: Graduate and professional students are no longer eligible for the Subsidized Stafford Loan, effective July 2012.
  • Must be a U.S. citizen, U.S. national, or permanent resident of the United States.
  • Cannot be in default on a Federal education loan or owe a repayment of Federal Title IV aid.

Award Amounts

Federal Direct Loan Limits - Purdue University 2016-17

Year / Classification

SGASTDN

Total Annual Grade

Level Limit

Maximum Subsidized Amount

Calculate Annual 

Unsubsidized Eligibility

Interest Rate for 

Loans Disbursed Between

7/1/16 - 6/30/17

Aggregate Limits
Dependent Undergraduate Students
Freshman $5,500 $3,500 = $5,500 - Awarded Sub Amount 3.76%

$31,000

(no more than $23,000 can be subsidized)

Sophomore $6,500 $4,500 = $6,500 - Awarded Sub Amount 3.76%
Junior or Senior $7,500 $5,500 = $7,500 - Awarded Sub Amount 3.76%

Independent Undergraduate Students1 

Freshman $9,500 $3,500 = $9,500 - Awarded Sub Amount 3.76%

$57,500

(no more than $23,000 can be subsidized)

Sophomore $10,500 $4,500 = $10,500 - Awarded Sub Amount 3.76%
Junior or Senior $12,500 $5,500 = $12,500 - Awarded Sub Amount 3.76%
Graduate and Professional Students Are Not Eligible for Subsidized Loans
Graduate Students $20,500 $0 $20,500 5.31% $138,500
Pharmacy Professional Students
Pharmacy P1, P2, & P3

$33,000

(9 mo)

$0 $33,000 5.31%

$224,000

Applies to all DP & VM students

Pharmacy P42 2 BBAY ($33,000) $0 $33,000 5.31%
Vet Med Professional 
Vet Med P1, P2, & P3 $40,500 (9 mo) $0 $40,500 5.31%
Vet Med P43

$40,500

2BBAY ($40,500)

$0 $40,500 5.31%

Teacher's License

Students

$12,500 $5,500 = $12,500 - Awarded Sub Amount 3.76%

Dependent $31,000

(no more than

$23,000 subsidized)

Indep $57,500

(no more than

$23,000 subsidized)

Subsidized Calculation = COA - EFC - All gift funds and remissions - Purdue/Perkins Loan(s) - FWS
Unsub Calculation = COA - All gift funds and remissions - Purdue/Perkins Loan(s) - FWS - Sub
PLUS or Private Calculation = COA - All other sources of aid
Prior Year Interest Rates (disbursed July 1, 2015 to July 1, 2016 The 2016-17 Parent and Grad PLUS Interest Rate is 6.31%
4.29% for Undergraduate Direct Loans 1 Also Applies to Dependent Students with a current Parent PLUS Denial
5.84% for Graduate and Professionals Direct Loan - Unsibsidized

Purdue 4th Year Vet Med consists of 11 month blocks

6.84% for Parent and Grand PLUS Loans Purdue 4th Year Pharmacy consists of 10 month clerkship rotations
Loans disbursed between 7/01/16 - 6/30/17 for undergraduates have an interest rate of 3.76%.lInterest Rate and Loan Fees
  • Loans disbursed between 7/01/16 - 6/30/17 for graduate students have an interest rate of 5.31%.
  • Refer to Interest Rate Maximums to see the limits in place.
  • Loan fee: 1.069% of accepted amount. The Department of Education's website and systems may not reflect this update immediately.
  • For example, for every $1,000 of Stafford Loans borrowed, the origination fees will be $11.00 (rounded up).

Loan Deadline

  • Fall term only (August-December) requests for 2016-17 Federal Stafford Loans may be processed if accepted by Thursday, December 8, 2016 at noon.
  • Spring only (January-May) or academic year (August-May) requests for 2016-17 Federal Stafford Loans may be processed if accepted by Thursday, May 4, 2017 at noon.
  • Summer loan deadlines depend upon the module(s) of enrollment. Loans must be accepted by the date indicated for the latest module you attend.
    • Module 1: June 7, 2017 at noon
    • Module 2: July 5, 2017 at noon
    • Module 3: August 3, 2017 at noon

Steps to Apply

  1. File the Free Application for Federal Student Aid (FAFSA) at www.fafsa.gov (this is a requirement) and submit all documents requested by the Division of Financial Aid (DFA); check for required documents via the online Financial Aid Self Service system at myPurdue.
  2. DFA will send the student an Award Notice that the borrower can use to determine loan period, the type of eligibility, and the amount of eligibility.
  3. The borrower needs to determine how much they want to borrow and will have the option to accept the full amount offered or reduce the loan amount at myPurdue.
  4. First time borrowers need to complete a Stafford Master Promissory Note (MPN) and Loan Entrance Counseling online. Red flags will appear, even if these requirements have been complete, until we begin processing loans in July.
  5. DFA certifies eligibility with the Direct loan servicer.
  6. Stafford loan funds are processed electronically through the Purdue Bursar. The student will be notified by the Bursar's Office that funds have been processed. Funds are applied first to fees, then to any housing costs (if the Bursar bills for housing). Any remaining Stafford funds are sent to the student via paper check or direct deposit.

Requirements

Master Promissory Note (MPN)

The Stafford Loan Master Promissory Note is a multi-year or serial loan feature of the Stafford program. It allows borrowers to receive future Stafford Loan funds without completing and signing additional promissory notes as long as the borrower remains eligible and completes appropriate loan request processes. By signing only one promissory note, the delivery of Stafford Loan funds will occur even faster because it eliminates the time it takes for a promissory note to be mailed, completed, and returned to the loan service provider. Borrowers use their Federal Student Aid (FSA) ID to sign their promissory note at studentloans.gov.

Loan Entrance Counseling

Entrance Counseling, which should not be confused with Financial Awareness Counseling, will walk you through the Direct Loan process and explain your rights and responsibilities as a borrower. If you have not previously received a particular loan type (subsidized/unsubsidized or PLUS),  the Federal Government requires you to complete loan counseling at www.studentloans.gov to ensure that you understand the responsibilities and obligations you are assuming. 

You will need to log in using your Federal Student Aid (FSA) ID. You will need about 30 minutes to complete the counseling session.

Repayment

Loans are in deferred status as long as the student remains enrolled at least half time in a degree seeking program. If you would like more information regarding repayment, see Preparing for Student Loan Repayment section.

See repayment examples here assuming a 4.66% fixed interest rate for Undergraduates and 6.21% fixed interest rate for Graduates and 10 year repayment term. Borrowers can calculate payments at www.studentloans.gov

Amount Borrowed Payment
$5,000 $58
$10,000 $115
$20,000 $230
$30,000 $345
$50,000 $575

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Perkins Loans

A low-interest federal loan available to undergraduate and graduate students who complete the FAFSA by March 1, demonstrate financial need, and enroll at least half-time in a degree-seeking program. This loan program has numerous borrower benefits that are described in the Repayment Information section. Choose a section below for additional information.  Please note that the Perkins Loan program is currently scheduled to end after September 30, 2017.  No new Perkins loans will be offered to any student after that date.  Until then, Perkins loan may be available to students that have borrowed them before while attending Purdue, subject to additional eligibility criteria as described in the section below.

Eligibility

Must be  anundergraduate or graduate student enrolled at least half time (6 credit hours for an undergraduate student, 4 credit hours for a graduate student) as a degree-seeking student.

For an undergraduate, the student must have borrowed a Perkins loan at Purdue before, and have remaining financial need after all Direct Subsidized Stafford Loan aid for which the student is eligible, has been awarded.

Note:  Any awarded Direct Subsidized Stafford Loan does not have to be accepted by the student in order to accept the Perkins loan offer, but declining the Stafford Loan does not mean that the Perkins loan offer can be increased instead.

For a graduate, the student must have borrowed a Perkins loan at Purdue before, and must be enrolled in the same academic program as when he or she received his or her most recent Perkins loan.

Must be a U.S. citizen, U.S. national, or permanent resident of the United States.

Must have a current Free Application for Federal Student Aid (FAFSA) filed.

Award Amounts

Loan Amounts Annual Maximum: Depends on financial need as calculated by the Division of Financial Aid. Maximum award is usually $4,000. Up to $5,500 may be awarded on an exception basis.

Aggregate Maximums: Undergraduate - $27,500 | Graduate - $60,000.

Interest Rate

Perkins loans have a fixed interest rate of 5%. The borrower pays no interest while enrolled in school at least half time or during the nine-month grace period after leaving school.

Loan Deadline

Loan Deadline: Perkins Loans may be processed if accepted within 45 days of the start of the fall semester.

Timeframe from Acceptance to Crediting the Balance on Tuition or Housing or a Refund: Accepted Perkins Loans will credit any outstanding balance within 2 business days of accepting it on your myPurdue account. It will take approximately 1 week after accepting the Perkins Loan before any excess funds are refunded to the student. 

Steps to Apply 

  1. File the Free Application for Federal Student Aid (FAFSA) by March 1 for consideration and submit all required documents (as noted on the student’s myPurdue account) to the Division of Financial Aid (DFA). Eligibility for this loan is based on demonstrating a high level of financial need (as determined by the FAFSA) and available funding.
  2. DFA will send the student an Award Notice that the borrower can use to determine loan period, the type of eligibility, and the amount of eligibility.
  3. The borrower needs to determine how much they want to borrow and will have the option to accept the full amount offered or reduce the loan amount at myPurdue.

How to Accept/Decline 

View instructions for accepting or declining an offer on myPurdue

Promissory Note

As eligibility for future Perkins loans now includes the requirement that the student has borrowed before, no additional promissory note should need to be signed as all awardees will most likely have an open Master Promissory Note (MPN).  Purdue has an automated process that checks for a previously completed Perkins MPN, and when confirmed it will satisfy the outstanding promissory note requirement on the student’s myPurdue account.  Note that after acceptance of a Perkins loan offer, it may take 2-3 business days for this process to complete, so please allow at least that much time before contacting the Division of Financial Aid about an outstanding promissory note requirement.  In the unlikely event that a Perkins awardee no longer has an open MPN (for example, a student completely paid off his or her balance and the MPN was subsequently closed), a new note will need to be signed.  This can be done at www.ecsi.net/prom3P.  In such cases, ECSI will e-mail the student with notification and instructions on how to complete this process

Repayment

Grace Period: The nine-month period from the date student ceases half-time enrollment status. No interest accrues during grace period. No payments due, but voluntary payments may be made to reduce interest after grace period.

Repayment: $40 minimum monthly payment. Larger amount may be required, if necessary, to repay loan within time limit.

Early Repayment Penalty: None.

Consequences of Delinquency (on Defaulted Loan made by Purdue): Account will be listed with a collection agency. Report will be made to a credit bureau. Readmission to Purdue University will be denied and official transcripts withheld. All further aid at Purdue University will be denied to student. Legal action will be taken on extended default.

Borrower's Responsibilities

Entrance/Exit Interview: Handled through Educational Computer Systems, Inc. (ECSI). Report to ECSI prior to dropping below half-time status or withdrawing. See instructions for completing the Exit Interview obligation.

Notification of Change of Name and/or Address:
Notify ECSI. ECSI's contact information is listed below.
Educational Computer Systems, Inc.,
181 Montour Run Road,
Coraopolis, PA 15108;
Phone 1-888-549-3274

http://www.heartlandecsi.com/ 

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Purdue Loans

A low-interest institutional loan available primarily to undergraduate students who complete the FAFSA by March 1, demonstrate financial need, and enroll at least half-time in a degree-seeking program. This loan program has numerous borrower benefits that are described in the Repayment Information section. Choose a section below for additional information.

Eligibility

  • Must be undergraduate, graduate, or professional student enrolled at least half time (6 credit hours for an undergraduate student, 4 credit hours for a graduate student) as a degree-seeking student.
  • Must be a U.S. citizen, U.S. national, or permanent resident of the United States.
  • Must have a current Free Application for Federal Student Aid (FAFSA) filed.

Award Amounts

Loan Amounts Annual Maximum: Depends on financial need as calculated by the Division of Financial Aid. Maximum award is generally $3,000. Up to $8,000 may be awarded on an exception basis.

Aggregate Maximums: Undergraduate - $30,000 | Graduate - $50,000

Interest Rate

Purdue loans have a fixed interest rate of 5%. The borrower pays no interest while enrolled in school at least half time or during the six-month grace period after leaving school.

Loan Deadline

Loan Deadline: Purdue Loans may be processed if accepted within 45 days of the start of the fall semester.

Timeframe from Acceptance to Crediting the Balance on Tuition or Housing or a Refund: Accepted Purdue Loans will credit any outstanding balance within 2 business days of accepting it on your myPurdue account. It will take approximately one week after accepting the Purdue Loan and signing the Promissory Note before any excess funds are refunded to the student. 

Steps to Apply

  1. File the Free Application for Federal Student Aid (FAFSA) by March 1 for consideration, and submit all required documents (as noted on the student’s myPurdue account) to the Division of Financial Aid (DFA). Eligibility for this loan is based on demonstrating a high level of financial need (as determined by the FAFSA) and available funding.
  2. DFA will send the student an Award Notice that the borrower can use to determine loan period, the type of eligibility, and the amount of eligibility.
  3. The borrower needs to determine how much they want to borrow and will have the option to accept the full amount offered or reduce the loan amount at myPurdue.
  4. The student will be required to sign a Promissory Note 1-2 business days after accepting the loan.

How to Accept/Decline 

View instructions for accepting or declining an offer on myPurdue

Promissory Note

You will be required to sign a promissory note 1-2 days after accepting your loan. ECSI, the third party loan servicer, will send you an email in this timeframe indicating when your promissory note is available. You must sign a new promissory note each time you accept a Purdue Loan or an increase to an existing Purdue Loan. Borrowers can complete this requirement at www.ecsi.net/prom3P. Please allow 3-4 business days for our office to download the completed requirement and update your myPurdue account. (Please note: This promissory note is separate from any Stafford Loan requirement)

Repayment 

Grace Period: The six-month period from the date student ceases half-time enrollment status. No interest accrues during grace period. No payments due, but voluntary payments may be made to reduce interest after grace period.

Repayment: $50 minimum monthly payment. Larger amount may be required, if necessary, to repay loan within time limit.

Early Repayment Penalty: None.

Consequences of Delinquency (on Defaulted Loan made by Purdue): Account will be listed with a collection agency. Report will be made to a credit bureau. Readmission to Purdue University will be denied and official transcripts withheld. All further aid at Purdue University will be denied to student. Legal action will be taken on extended default.

Borrower's Responsibilities

Entrance/Exit Interview: Handled through Educational Computer Systems, Inc. (ECSI). Report to ECSI prior to dropping below half-time status or withdrawing. Review instructions for completing the Exit Interview obligation.

Notify ECSI if there is a Change of Name and/or Address:

Educational Computer Systems, Inc.,
181 Montour Run Road,
Coraopolis, PA 15108;
Phone 1-888-549-3274

http://www.heartlandecsi.com/  

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Graduate PLUS Loans

Graduate and professional students are eligible to borrow under the Federal Direct PLUS Loan Program. The Graduate PLUS loan amount is limited to the cost of attendance minus other estimated financial assistance. Interest will accrue after full disbursement of the loan. The borrower cannot have an adverse credit history.

Eligibility

  • Creditworthy graduate and professional students are eligible to borrow in the PLUS program as long as student is enrolled at least half time, is degree seeking, and does not have an adverse credit history.
  • The applicant will be ineligible if the credit history indicates "he or she is 90 days or more delinquent on any debt or has been the subject of a default determination, bankruptcy discharge, foreclosure, repossession, tax lien, wage garnishment, or write-off of a Title IV debt during the five years preceding the date of the credit report". The credit history will not be reviewed by the Federal Direct Loan processor until Purdue has processed the accepted PLUS award.
  • Borrower must be a U.S. citizen, U.S. national, or permanent resident of the United States.
  • Borrower cannot be in default on a federal education loan or owe a repayment of Federal Title IV aid.
  • Financial need is not a requirement to obtain a PLUS Loan, but the borrower is responsible for interest that accrues.

Award Amounts

PLUS Loan limits are determined by the estimated cost of attendance less any other aid. For the Grad PLUS program it is assumed the student will borrow the maximum amount available in the Federal Stafford Loan program.

Interest Rate and Fees

Loans disbursed between 7/01/16 - 6/30/17 have an interest rate of 6.31%. Refer to Interest Rate Maximums to see the limits in place. 

The effective up front loan origination fee is 4.276% of the accepted amount. The Department of Education's website and systems may not reflect this update immediately.
For example, for every $1,000 of PLUS Loans borrowed, the origination fees will be $43 (rounded).

Loan Deadline

Federal Graduate PLUS Loans may be processed if applied for online at www.studentloans.gov by the last Monday of the enrolled term. Applications for the 16-17 school year will be available online beginning in mid-April. 

Steps to Apply 

  1. File the Free Application for Federal Student Aid (FAFSA) and submit all documents requested by the Division of Financial Aid (DFA); check for required documents via the online Financial Aid Self Service system at myPurdue.
  2. DFA will send the student an Award Notice that the borrower can use to determine loan period, the type of eligibility, and the amount of eligibility; the borrower needs to determine how much they want to borrow. Grad PLUS borrowers must complete a separate application online at www.studentloans.gov.
  3. DFA will certify borrower eligibility with the Direct Loan service provider. The loan service provider approves the loan once the borrower has completed a PLUS Master Promissory Note (MPN) at studentloans.gov (if not already on file).
  4. Grad PLUS Loan funds are normally sent electronically to the Purdue Bursar by the loan service provider. The borrower will be notified by the Bursar’s Office that funds have arrived. Funds are applied first to fees, then to any housing costs (if the Bursar bills for housing). Any remaining Grad PLUS funds are sent to the borrower. Please note that it is important that students keep their address up-to-date via myPurdue and read all email from facontact@purdue.edu.

Options if the Graduate PLUS Loan is Denied

If the Graduate PLUS Loan application was denied due to adverse credit as determined by the Federal Direct Loan Center, two borrowing alternatives are in place to help compensate for the denial.

  • You can appeal the credit decision with the Federal Direct Loan Center. This process will require you to complete PLUS Credit Counseling at the studentloans.gov website. If you appeal the credit decision with the Federal Direct Loan Center and are granted a credit override, please email facontact@purdue.edu and include the loan application number, any reference number given to your case by the Direct Loan servicer, and your Purdue ID (PUID) number.
  • You can apply with an endorser. This process will require you to complete PLUS Credit Counseling at the studentloans.gov website. Currently, Purdue only receives notifications of approved endorsed loans if the endorser application was completed electronically. Endorsed loans require manual intervention, so if you have completed a paper endorser application you must email facontact@purdue.edu and include the loan application number, any reference number given to your case by the Direct Loan servicer, and your PUID. Providing us the above information may speed up processing if you submitted your endorser application electronically. Note:  Endorsed loans require the parent borrower to sign a promissory note after the endorser has been approved.

Master Promissory Note

The PLUS Loan Master Promissory Note is a multi-year or serial loan feature of the PLUS program. It allows borrowers to receive future Federal PLUS Loans without completing and signing additional promissory notes as long as the borrower remains eligible for Federal PLUS Loan and completes appropriate loan request processes. By signing only one promissory note, the delivery of PLUS loan funds will occur even faster because it eliminates the time it takes for a promissory note to be mailed, completed, and returned to the loan service provider. Borrowers will use their Federal Student Aid (FSA) ID to sign their promissory note at studentloans.gov.

Repayment 

Loan repayment may be deferred in the PLUS program if the student remains enrolled at least half time (but interest accrues). For information regarding in-school deferments and payment plans please contact the Direct Loan Servicer at www.studentloans.gov or 1-800-557-7394.

See repayment examples here assuming a 7.21% fixed interest rate and 10 year repayment term. Borrowers can calculate payments at www.studentloans.gov

Amount Borrowed Payment
$5,000 $60
$10,000 $121
$20,000 $242
$30,000 $362

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Health Professions Student Loans

A low-interest federal loan available to professional students in Doctor of Pharmacy or Veterinary Medicine who complete the FAFSA by March 1 including parent income information, demonstrate financial need, and enroll full-time in one of the eligible degree objectives. Choose an option below to expand and see more information.

Award Amounts, Interest Rate, and Loan Fees

The award amount depends on financial need as calculated by the Division of Financial Aid from FAFSA results. The interest rate is 5% annually on the declining balance. The Health Professions Student Loan program does not have origination fees or an aggregate maximum.

Steps to Apply 

  • File the FAFSA every year by March 1 for consideration; award based on level of financial need.
  • Once the loan is offered, accept offer on your myPurdue.
  • Sign the promissory note at http://www.ecsi.net/prom3P 1-3 business days after accepting the loan.
  • Students in Veterinary Medicine or Pharmacy and Pharmaceutical Sciences must enroll in at least 12 credit hours each semester.

Repayment

Grace Period: The 12-month period from date student ceases full-time student status. No interest accrues during grace period. No payments due, but voluntary payments may be made to reduce interest after grace period.

$40 minimum monthly payment. Larger amount may be required, if necessary, to repay loan within time limit. (Must remain in 12 credit hours or grace period begins immediately).

There is no penalty for early repayment.

The maximum repayment period is 10 years.

Consequences of Delinquency

Account will be listed with a collection agency. Report will be made to a credit bureau. Loans made from Purdue will result in readmission to Purdue University being denied and official transcripts withheld. All further aid at Purdue University will be denied to student. Legal action will be taken on extended default.

Special Application Requirements

Students must file FAFSA for consideration. All professional students will be considered independent according to the need analysis formula in Title VII of the Higher Education Act. Nonetheless, institutions still must take parents' information into account for the purpose of awarding HPSL funds. This requirement cannot be waived. In cases where the parents refuse to provide income information, an affidavit documenting such a refusal cannot be accepted in lieu of the required information. Unless the parents are deceased, a student who does not provide parental income information may not be considered for HSPL funds.

Use of parental data on the FAFSA does not guarantee the student is awarded the HPSL as these funds are limited each year.

Borrower's Responsibilities

Entrance/Exit Interviews are handled through ECSI (Educational Computer Systems, Inc). Report to ECSI prior to dropping below half-time status, withdrawing, graduating, transferring, or if there is a change of name and/or address:

ECSI, 181 Montour Run Road, Corapolis, PA, 15108-9408. Phone 1-888-549-3274. http://www.heartlandecsi.com/ 

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Parent PLUS Loans

A Federal Parent PLUS Loan is a Federal Direct Loan for parents that can be used to help pay for the college education of a dependent undergraduate child.

Eligibility

  1. The parent of a dependent student is eligible to borrow in the Direct PLUS program as long as the student is enrolled at least half time, the student meets satisfactory academic progress requirements, and the parent does not have an adverse credit history.
  2. The parent applicant will be ineligible if the credit history indicates "he or she is 90 days or more delinquent on any debt or has been the subject of a default determination, bankruptcy discharge, foreclosure, repossession, tax lien, wage garnishment, or write-off of a Title IV debt during the five years preceding the date of the credit report".
  3. The borrower must be a U.S. citizen, U.S. national, or permanent resident of the United States.
  4. Financial need is not a requirement to obtain a PLUS Loan.
  5. The PLUS borrower is responsible for interest that accrues on a PLUS Loan.

NOTE: A parent is defined as a biological parent or custodial step-parent.

Award Amounts

PLUS Loan limits are determined by the estimated cost of attendance less any other aid.

Interest Rate and Fees 

Loans disbursed between 7/1/15 - 6/30/16 have an interest rate of 6.31%. Refer to Interest Rate Maximums to see the limits in place. 

The effective up front loan origination fee will be 4.276% of the accepted amount. The Department of Education's website and systems may not reflect this update immediately.
For example, for every $1,000 of PLUS Loans borrowed, the origination fees will be $43 (rounded).

Loan Deadline

Federal Parent PLUS Loans may be processed if applied for online at www.studentloans.gov by the last Monday of the enrolled term. Applications for the 16-17 school year will be available online beginning in mid-April.

Steps to Apply

  1. File the Free Application for Federal Student Aid (FAFSA) and submit all documents requested by the Division of Financial Aid (DFA); students can check for required documents via the online Financial Aid Self Service system through myPurdue.
  2. DFA will send the student an Award Notice that indicates the loan period, the type of eligibility, and the amount of eligibility; the parent borrower should use this information to determine how much they want to borrow.
  3. The parent PLUS Loan borrower (not the student) should go to the www.studentloans.gov website sign in under Manage My Direct Loan using their Federal Student Aid (FSA) ID and select "Start PLUS Application Process" to complete a PLUS Loan application for Purdue University (West Lafayette).
  4. In the application, the borrower will have several options to select regarding the amount of the loan, who should receive any excess funds as a refund (if applicable), and whether to defer the loan or not.
    • Notes about the loan application options:
      • The borrower may either request the maximum amount offered or a specific amount. Requests for the maximum amount will only be processed for the academic year.
      • Only a specific requested amount may be processed as a loan for one semester.
      • The parent borrower may direct the excess funds of the Parent PLUS Loan (if applicable) to be refunded to the student or the borrower.
      • A Parent PLUS Loan is not automatically deferred like the student Stafford Loans are. If the deferment is selected in the application, interest will accrue while the student is in school, but no payments are required until after the student graduates. If deferment is not selected, repayment will begin 60 days after disbursement of the funds. For example, if the student is attending for the fall and spring semester, repayment would begin 60 days after the spring disbursement. If the student is only attending the fall semester, repayment would begin 60 days after that disbursement.
      • A Parent PLUS Loan may be used to pay for tuition and fees or room and board if billed through the university. At this time, Purdue University is not able to support paying other incidental expenses with Parent PLUS Loan proceeds.
  5. The Direct Loan servicer will pull credit and approve the loan after the borrower completes the PLUS application and PLUS Master Promissory Note (if not already on file). If the loan is credit-denied, see the borrowing alternatives in the next section.
  6. DFA will then certify borrower eligibility with the Direct Loan servicer. This certification process begins around July 1 each year. Note that the PLUS loan status in myPurdue system will continue to display an offered status until DFA begins the PLUS loan certification process.
  7. PLUS Loan funds are processed electronically through Purdue Bursar's Office once the student has registered for classes, been invoiced, and confirms their enrollment in the myPurdue system. The Bursar applies PLUS funds to fees first, then to any housing costs (if the Bursar bills for housing). Any remaining PLUS funds are sent to the borrower via a paper check no earlier than 10 days before the start of classes.

Options if the PLUS Loan is Denied

If the Parent PLUS Loan application was denied due to adverse credit as determined by the Federal Direct Loan Center, three borrowing alternatives are in place to help compensate for the denial.

  • The student can receive an additional Unsubsidized Stafford Loan. Unless you indicated on your application that you are planning to pursue the endorser option, your student will automatically be reviewed for the additional Unsubsidized Stafford Loan. If eligible, an offer for the additional Unsubsidized Stafford Loan of $4,000-5,000 (dependent upon grade level) will appear on their myPurdue account within 7-10 days. If your student wants this loan, they must accept it online.
  • The parent can appeal the credit decision with the Federal Direct Loan Center. This process will require the parent borrower to complete Parent PLUS Credit Counseling at the studentloans.gov website. If you appeal the credit decision with the Federal Direct Loan Center and are granted a credit override, please email facontact@purdue.edu and include the loan application number, any reference number given to your case by the Direct Loan servicer, and your student’s Purdue ID (PUID) number.
  • The parent can apply with an endorser. Currently, Purdue only receives notifications of approved endorsed loans if the endorser application was completed electronically. Endorsed loans require manual intervention, so if you have completed a paper endorser application you must email facontact@purdue.edu and include the loan application number, any reference number given to your case by the Direct Loan servicer, and your student’s PUID. Providing us the above information may speed up processing if you submitted your endorser application electronically.

As noted above, if you indicated on your application that you will pursue an endorser, we will wait 7-10 days before reviewing your student’s eligibility for the additional Unsubsidized Stafford Loan.

Master Promissory Note

The PLUS Loan Master Promissory Note is a multi-year or serial loan feature of the PLUS program. It allows borrowers to receive future Federal PLUS Loans without completing and signing additional promissory notes as long as the borrower remains eligible for Federal PLUS Loan and completes appropriate loan request processes. By signing only one promissory note, the delivery of PLUS loan funds will occur even faster because it eliminates the time it takes for a promissory note to be mailed, completed, and returned to the loan service provider. Borrowers will use their Federal Student Aid (FSA) ID to sign their promissory note at www.studentloans.gov

Repayment

Loan repayment may be deferred in the PLUS program if the student remains enrolled at least half time (but interest accrues). For information regarding in-school deferments and payment plans please contact the Direct Loan Servicer at www.studentloans.gov or 1-800-557-7394.

See repayment examples here assuming a 7.21% fixed interest rate and 10 year repayment term. Borrowers can calculate payments at www.studentloans.gov.

Amount Borrowed Payment
$5,000 $60
$10,000 $121
$20,000 $242
$30,000 $362

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Federal Loans: Interest Rate Maximums 

The Federal Direct Loan interest rates are variable with the market each year but fixed for the specific loan once it is disbursed. This means the rates will change each year, but once a loan is made it will be fixed for the life of the loan. So, if you are an undergraduate student taking out Stafford Loans for the 2016-17 academic year, your interest rate on those loans will stay at 3.76% for the lifetime of the loan. If the interest rate were to jump up the next year, the interest rate on your 2016-17 Stafford Loan would not change; it would only affect the loans taken out for the 2017-18 academic year.

All loans have a maximum interest rate: Undergraduate Stafford 8.25%, Grad Stafford 9.5% and PLUS 10.5%. This means that the loan interest rates cannot exceed the interest rates listed as of Congress passing the bill.

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Private Loans: Private Loan Vendors

Purdue University students borrow from a variety of private lenders.  The Division of Financial Aid Office does not recommend any particular lender; these tools are provided to assist you in looking for a private education loan that best fits your needs.  Listed below are application tools that will provide access to multiple lenders.  Both tools have the lenders application conditions and Truth In Lending disclosure information. Not all lenders participate in both tools: ELMSelect provides a range of rates and ISM Marketplace provides actual rates. Neither tool is an actual application for a loan.  Once borrowers have chosen a lender, an application will have to be completed on the lender’s website.  As a borrower, you have the option to select any lender you choose.  Please understand that we will process a loan with a lender that is not listed.  If you have questions regarding the process, please contact our office.

General Information about Private Educational Loans

  • Private loans may have higher interest that accrues while the student is enrolled.
  • Require good credit history for student (or co-borrower) in order to be approved for the loan.
  • Lenders require international borrowers to have an U.S. Citizen or permanent resident co-signer.
  • Most lenders require that you be enrolled at least half time in a degree-seeking program.
  • Must complete a Self-Certification Form to provide financial aid information to your lender. This can be accessed on the Accept Award Offer and Cost of Attendance tabs of the student’s myPurdue account.
  • Due to requirements of the private lenders, we recommend that you apply at least three weeks prior to the date you need the funds and comply quickly to information requests from your lender.
  • Some lenders have products where parents and/or other willing persons can borrow on behalf of the student.

ISM Marketplace

ELM Select

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Preparing for Student Loan Repayment

General Repayment Questions

Q: Who do I repay?

A: Your lender or a loan servicer is responsible for billing and receipt of payments. Many times a lender will hire a company to perform the billing functions for its loans, and this company is referred to as a loan servicer. You can contact your lender or loan servicer for information.

Q: When do I start repayment?

A: You may be entitled to one 6-month grace period after you stop attending a school at least half time; however, there are variable grace periods depending on your individual situation - check with your servicer for more information. During this grace period, the lender or loan servicer will contact you and tell you how much your payments will be and how to make them. If you go back to school, you can obtain a deferment so you can temporarily postpone payments.

Q: Can Purdue answer my loan questions after I graduate?

A: We can help you with general questions, but the best source for you to contact is your loan servicer.

Q: Where and when will I receive information about payments due?

A: Your loan servicer or lender must provide you with a loan repayment schedule that states when your first payment is due, the number and frequency of payments, and the amount of each payment. Keep in mind that your loan may have a grace period. You will receive this information sometime after you graduate. If you have graduated and have not received information from your servicer within a few months, you should contact your servicer to make sure they have your current information such as email and mailing address.

Q: What type of assistance is available once I start repayment?

A: Your lender or loan services can answer almost all loan repayment questions.

Loan Servicer Information

Q: What is the difference between a lender and servicer?

A: The lender provides the money for the loan. A loan servicer is a company that handles the billing and other services on your Federal student loan. The loan servicer will work with you on repayment plans and loan consolidation and will assist you with other tasks related to your Federal student loan. It is important to maintain contact with your loan servicer. If your circumstances change at any time during your repayment period, your loan servicer will be able to help.

Q: How do I know who my servicer is?

A: Your loan is assigned to a loan servicer by the U.S. Department of Education after the entire loan amount is disbursed. The loan has been disbursed when your school transfers your loan money to your school account, gives money to you directly, or a combination of both. Your loan is usually disbursed in at least two payments provided it is an academic year loan. It would be in one payment if you are borrowing for one semester. The servicer(s) assigned to any Federal loans you borrowed will be listed on the National Student Loan Data System (NSLDS) website.

Borrowing history

Q: What if I disagree with the total amount that I owe or loans that I've borrowed?

A: You should first identify your loan problem, and then contact your loan servicer. If you are unable to agree on the amounts after contacting your servicer you have additional options. For more detailed information please visit http://studentaid.ed.gov/repay-loans/disputes. For more information that is not listed here, please visit http://studentaid.ed.gov/repay-loans/understand to understand loan repayments.

Q: Where can I obtain a copy of all of the loans I borrowed?

A: Federal loans you may have borrowed while in school will be listed at NSLDS. Any Parent PLUS Loans and Perkins loans will also be listed. Purdue loans and private loans will not be listed on this website.

Q: How do I know how much I've borrowed and have to repay?

A: Visit the National Student Loan Data System (NSLDS) website to view information about all of the Federal student loans you have received and to find contact information for the loan servicer or lender for your loans. You will need your Federal Student Aid ID to access your information.

Exit counseling

Q: Do I have to complete exit counseling if I am starting another program/degree in the semester following graduation, also at Purdue?

A: Yes. You will need to complete Exit Counseling at this time and then, if needed, process an in-school deferment (if you want to postpone repayment of your loans) once you are registered as a graduate student or have been enrolled for another program.

Q: Which loan requires exit counseling?

A: If you had a Subsidized, Unsubsidized or Graduate PLUS loan, you have 30 days after graduation to complete this federal requirement. You are also required to complete exit counseling for any Perkins or Purdue loans. These two loans are serviced by ECSI, a third party servicer specifically for loans awarded to Purdue students.

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Borrower Rights

As a student borrower, you are entitled to:

  • Repayment period of at least ten years as long as the $50 minimum monthly payment is met;
  • A copy of your repayment schedule and disclosure statement from your lender or guarantee agency;
  • Have any questions about your Federal Loan answered by your lender or guarantor.

As a student borrower, you have the right to:

  • Prepay all or any part of your loan at any time without penalty;
  • Be notified in writing by your lender if your loans are sold or transferred for servicing;
  • Have your loan obligation canceled if you die or be­come totally and permanently disabled;
  • Defer payment for a specified period of time, if qualified.

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Borrower Responsibilities

Acceptance of an educational loan requires:

  1. That you use the loan for educational expenses and repay your loan debt in full even if you:
    • Do not graduate or complete your program of study;
    • Are unable to obtain employment on ending or completing your program;
    • Are dissatisfied with the school or did not receive the education or other services you purchased from the school.
  2. You must make payments on your student loan at the end of your grace period whether or not you have received a repayment schedule. If your first payment due date is nearing and you have not received a repayment schedule, contact your loan service provider.
  3. You must notify your lender if you change schools; name or address; enrollment status (e.g., withdraw, graduate, or enroll less than half time).
  4. Upon leaving school, you must notify your loan service provider of your expected employer and permanent address, the address of next of kin, and any changes in your social security or driver's license numbers.
  5. If you receive notice that your loan is being serviced by an agency other than your lender, you must refer all further correspondence, inquiries, or payments to the servicer.
  6. You should keep copies of all student loan papers, documents, and correspondence.

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Consequences of default

When you accept a student loan, you also undertake the obligation to repay it. This is a serious obligation, as you may not include student loan debt should you ever file bankruptcy.

Contrary to popular belief, default on a student loan is not ignored by colleges, banks, or the government. Default on student loans will affect your credit rating. Extended default eventually can lead to prosecution. Whatever your circumstances, don't default! Lenders would rather work with you if you are finding it difficult to repay and can offer alternatives rather than have you in default. If you fail to repay your loan according to its terms and conditions, your default will be reported to a national credit bureau and you may suffer any or all of the following consequences:

Collection agency action;

  • Withholding of federal income tax refunds;
  • Garnishment of wages;
  • Loss of eligibility for federal student aid;
  • Difficulty in obtaining other credit;
  • In most instances, student loans may not be discharged through bankruptcy.
  • If you’re having trouble making payments, don’t wait! Get help from your loan holder or servicer immediately.

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Grace period

The Federal Loan grace period begins the day after you leave school ("leaving school" means graduat­ing, withdrawing, or dropping to less than half-time enrollment status). The grace period for most Federal Loans is six months; during this period, no payments are due. 

View more information about grace periods.

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Repayment

With the Subsidized Federal Loan, interest accrues during certain periods. The grace period is 6 months, when no payment is required. Approximately 30-45 days after the grace period ends, your first payment will be due. Thereafter, payments are due once a month until the loan is paid in full. You will receive a repayment schedule and disclosure statement for each of your student loans from your loan service provider. This schedule will tell you how much your payments will be, when they are due, and over what period of time you will be paying.

For Unsubsidized Federal Loans, students are responsible for paying interest during the period of time that the principal is deferred. Because most lenders will permit students to defer interest repayment during school enrollment, the interest accrues during this deferred period.

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Deferment

A deferment is a period of time (varying in length as indicated below) when you are not required to make payments on your loans because you temporarily cannot afford the scheduled payments. If you think you are eligible for a deferment, contact your lender/servicer. A deferment does not apply and you are not excused from making loan payments until the documentation is complete.  

For borrowers with no loans prior to July 1, 1993, the following types of deferment are available:

  • at least half-time study at an eligible school,
  • studying in an approved graduate fellowship or rehabilitation program for the disabled,
  • up to three years, while you are conscientiously seeking but unable to find full-time employment,
  • up to three years, for any reason (in accordance with federal regulations) that has caused you to have an economic hardship.

Deferments for borrowers with an outstanding FFELP loan disbursed before July 1, 1993, include:

  • unemployment,
  • full-time enrollment at an eligible school,
  • half-time enrollment at an eligible school, if you borrow a new Federal Loan during the enrollment period,
  • participation in a rehabilitation program,
  • study under an approved graduate fellowship program,
  • serving an internship necessary for professional practice or service,
  • temporary or total disability, or inability to work because caring for a temporarily or totally disabled spouse or dependent,
  • parental leave to care for a newborn, if you attend school in the six months prior to the leave,
  • mothers who have pre-school age children and are entering or re-entering the work force at less than $1 above minimum wage,
  • service in the National Oceanic and Atmospheric Administration Corps (NOAA),
  • active duty service in the U.S. armed forces or service as an officer in the Commissioned Corps of the United States Public Health Service,
  • full-time teaching in a private, nonprofit, or public elementary or secondary school shortage area. 

View more information about deferments.

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Forebearance

Should you become financially unable to make monthly payments, you may be able to suspend payments, lower payment amounts, or make interest payments only for a short period of time (six-month periods) at the discretion of your loan service provider.

View more information about forbearance.

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Consolidation

Here are some pros and cons to loan consolidation:

  • obtain a fixed interest rate and one monthly payment
  • extend the time for repayment (up to 30 years)
  • reduce the monthly payment amount
  • pay in full one or more of your existing student loans
  • you may pay MORE overall.

The interest rate for the consolidation loan is the "weighted average" of the interest rates on the loans being consolidated and is fixed for the life of the loan. Before committing to loan consolidation, be sure to discuss your particular situation fully with a loan consolidation specialist to see if loan consolidation is best for you.

If you do not have any Federal Direct Student Loans, you must first contact the holders of your loans or loan servicer to see if any participate in the consolidation loan program. If so, they will provide you with the application and an explanation of the procedure.

If the federal loan holder does not offer a federal consolidation loan program, does not offer you acceptable income-sensitive terms, or you intend to apply for the Public Service Loan Forgiveness Program; you can apply for a Federal Direct Consolidation Loan.

View more information about loan consolidation.

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Debt Management

In order to manage your student loan debt, you will need to manage your finances in general. Good money management involves setting goals, setting a time frame to reach those goals, and developing and following a budget. To reach your goals, you should begin thinking about your budget while in college. The amount of your expected starting salary is an important element in creating and managing a budget. You may wish to contact the Purdue University Center for Career Opportunities for up-to-date salary information for your field and the part of the country in which you intend to live.

The U. S. Department of Education has made available to students the office of the FSA Student Loan Ombudsman. This office works with student loan borrowers to informally resolve federal loan disputes and problems. It is best to think of the Ombudsman as a LAST RESOURCE. When you have made a reasonable effort to resolve your student loan problem with your lender/servicer and the problem is still not resolved, contact the Ombudsman. This office may be contacted online for assistance, via e-mail at fsaombudsmanoffice@ed.gov; or via telephone 1-877-557-2575 (toll free)

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Right to Cancel Loans

Federal regulations allow student loan borrowers up to 14 days after disbursement of funds to cancel or reduce the loans.  The following describes the process to request a cancellation or reduction of student loans.

Students may contact the Bursar requesting cancellation of any disbursed loans.

Please be aware that you will be required to replace the funds that applied towards your account with a Cashier’s check or money order payable to Purdue University. You may view financial aid funds applied to your account, (including Federal loan funds), by logging into your myPurdue account.

If you repay your loans directly to the Direct Loan Servicer, your loan account will be credited as a repayment on the loan rather than a reduction/cancel.  This means that your loan fees will not be reduced, nor will it renew you academic year eligibility.  If you had already borrowed your academic year limit, your will not be able to re-borrow this amount later.

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Purdue University Division of Financial Aid, Schleman Hall, Room 305, 475 Stadium Mall Drive, West Lafayette, IN 47907-2050, (765) 494-5050

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