Loans
OVERVIEW
Loans provide an opportunity for families to spread out college costs over a repayment period. Most student loans provide an opportunity for deferment of principal payment until after graduation or until the student ceases to be enrolled at least half time in a degree-seeking program. Most parent loans require payment while the student is in college.
More information is available in the Student Loan Counseling section of this website.
APPLICATION PROCESSES
The application procedures vary according to the type of loan program. More information is available at each loan program web page.
The Federal Perkins Loan, Federal Health Professions Loan, and Purdue University Loans are awarded by the Division of Financial Aid; you are automatically considered for these programs by filing the Free Application for Federal Student Aid (FAFSA) by March 1 of the year you will be attending Purdue. You will receive promissory notes for these loans from the University Collections Office if you receive an award.
The application process for Federal Loans requires you to file the FAFSA and complete a request form after the Division of Financial Aid determines your eligibility.
Though you are not required to file the FAFSA for Private Alternative Loans, you are encouraged to do so first to allow the Division of Financial Aid to determine your eligibility for other loan programs as well as other sources
RIGHT TO CANCEL LOAN INFORMATION
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 student account at https://mypurdue.purdue.edu.
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.
LOAN HISTORY
Purdue is partnering with The National Student Clearinghouse to provide currently enrolled students access to federal and private loan history in one convenient location. This information is available through the Academic Tab in myPurdue and by clicking on the Enrollment Certification/National Student Clearinghouse link.
This service is not available for students who have graduated or for students who are no longer enrolled at Purdue. These students can access their federal loans through the National Student Loan Database System. Private loan information may be obtained by contacting their lender or servicer.
A WORD ABOUT 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.
A WORD ABOUT ENCUMBRANCES
Encumbrances placed on the student's records by the University before the beginning date of the loan period will prohibit processing of a loan application. It is a student's responsibility to clear the encumbrance and notify the Division of Financial Aid. If unable to repay the encumbrance in full, a student must work with the office that placed the encumbrance to possibly make payment arrangements.
STUDENT LOAN CODE OF CONDUCT
Purdue University has developed a Student Loan Code of Conduct in compliance with federal regulations. Division of Financial Aid staff members comply with the Purdue University Student Loan Code of Conduct. Click here for more information.