Answers to your most frequently asked questions
You must complete the Free Application for Federal Student Aid to be considered for a student loan. The Financial Aid Office staff will process your award, which often includes your loan eligibility amounts. You will be able to view your award and accept or decline aid on My Northeast. If loans are not included in your aid package, contact the Financial Aid Office. You still may have eligibility. Once you know what your eligibility is you must complete the following:
- Accept or decline the loan(s) on My Northeast or by returning a paper award letter. Indicate the amount(s) you wish to borrow for the year.
- Complete a Direct Loan Master Promissory Note (MPN) at https://studentaid.gov/. The MPN is a legal document in which the borrower promises to repay the loan and any accrued interest and fees to the Department of Education. It also explains the terms and conditions of the loan. This only needs to be done when you apply for your first Direct Loan at Northeast.
- Complete online Direct Loan Entrance Counseling at https://studentaid.gov/
Northeast will be notified once you have completed your Direct Loan Master Promissory note and Loan Entrance Counseling and we will certify your loan request for the amount that you accepted in your award notification.
On subsidized Direct Student Loans, the U.S. Department of Education pays (subsidizes) the interest while the borrower is in school at least half time. A student has a grace period of 6 months after they graduate, leave school, or drop below half-time status before they must begin repayment on the loan. Interest will accrue during these 6 months and will be payable by the student rather than subsidized by the federal government.
First-time borrowers: New maximum time for Direct Subsidized Loans:
New federal regulations limit new borrower eligibility for Direct Subsidized Loans to 150% of the published length of an undergraduate program. This limit applies only to first-time borrowers. See the Federal Student Aid Information sheet for a full explanation of this change.
The interest rate of the Direct Federal Subsidized Student Loan for 2020-2021 is 2.75% fixed.
For an unsubsidized Direct Student Loan, the borrower is responsible for paying the interest that accrues. The student does not have to pay any principal, but can either pay the interest as it accrues or it will be capitalized (i.e., added to the principal loan balance later). A student has a grace period of 6 months after they graduate, leave school, or drop below half-time status before they must begin repayment on the loan.
The interest rate of the Direct Federal Unsubsidized Student Loan for 2020-2021 is 2.75% fixed.
Your student must complete the financial aid application process (FAFSA) in order for you to be considered for a Direct Parent PLUS loan. To borrow a Direct Parent PLUS loan for a student, the parent must be the student’s biological or adoptive mother or father. A stepparent is also eligible to borrow a PLUS loan if his/her income and assets were taken into account when calculating the Expected Family Contribution (EFC) on the FAFSA. A legal guardian is not considered a parent for federal purposes. The student must be attending at least half time and maintain satisfactory academic progress. Parent borrowers wishing to apply for a Direct Parent PLUS Loan must complete the following:
- The student is awarded a Federal Parent PLUS loan and needs to accept award on My Northeast account.
- Direct Parent PLUS Loan Application at https://studentaid.gov/. Available after May 1 each year.
- Direct Parent PLUS Loan Master Promissory Note (MPN) at https://studentaid.gov/. The MPN is a legal document in which the borrower promises to repay the loan and any accrued interest and fees to the Department of Education. It also explains the terms and conditions of the loan. In most cases, one MPN can be used for loans that a parent receives over multiple academic years although a new PLUS Loan Application must be filed for each school year. The parent who completes the PLUS Loan MPN must be the same parent who completes the PLUS Loan Application.
The Financial Aid Office at Northeast will be notified once you have completed the MPN and PLUS Loan Application. We must receive this notification before any PLUS loan funds can be disbursed to your student’s account.
PLUS Loan counseling is required for borrowers with an adverse credit history who are nonetheless determined to be PLUS Loan eligible because of meeting the extenuating circumstances provision or obtaining an endorser. Counseling can be completed https://studentaid.gov/.
The interest rate of the Federal Parent PLUS Loan for 2020-2021 is 5.30% fixed.
Payments are made to the U.S. Department of Education for both Direct Student Loans and Direct Parent PLUS Loans.
Students do not have to start repayment of Direct Student Loans until six months after they graduate or they fall below half-time status. However, payments may be made at any time towards your loan. Your loan servicer will provide information about repayment and will notify you of the date loan repayment begins.
The repayment period for all Parent PLUS Loans begins on the date the loan is fully disbursed, and the first payment is due within 60 days of the final disbursement. Parent PLUS Loan borrowers whose loans were first disbursed on or after July 1, 2008, may choose to have repayment deferred while the student for whom the parent borrowed is enrolled at least half-time and for an additional six months after that student is no longer enrolled at least half-time. Interest that accrues during these periods will be capitalized if not paid by the parent during the deferment. Your loan servicer will provide information about repayment.
The U.S. Department of Education's National Student Loan Data SystemSM (NSLDSSM) provides information on your federal loans including loan types, disbursed amounts, outstanding principal and interest, and the total amount of all your loans. To access NSLDS, go to https://nslds.ed.gov.
If you're not sure who your loan servicer is, you can look it up on https://nslds.ed.gov or call the Federal Student Aid Information Center at 1-800-4-FED-AID (1-800-433-3243; TTY 1-800-730-8913). To see a list of Federal Student Aid servicers for the Direct Loan Program and for FFEL Program Loans purchased by the U.S. Department of Education, go to the Loan Servicer page.
On August 2, 2011, Congress passed the Budget Control Act of 2011, which put into place automatic federal budget cuts, known as the “sequester.” While this law does not otherwise change the amount, terms, or conditions of your Direct Federal Loan or the Direct Plus Loan (for both parent and graduate student borrowers) it does increase the loan fees on these loans whose first disbursement is on or after October 1, 2020.
The chart below shows the loan fees for Direct Subsidized Loans, Direct Unsubsidized Loans, and Direct PLUS Loans first disbursed on or after October 1, 2019.
|Loan Type||First Disbursement Date||Loan Fee|
|Direct Subsidized Loans and Direct Unsubsidized Loans||On or after 10/1/2019 and before 10/1/2020
On or after 10/1/2020 and before 10/1/2021
|Direct PLUS Loans||On or after 10/1/2019 and before 10/1/2020
On or after 10/1/2020 and before 10/1/2021
Loans first disbursed prior to Oct. 1, 2019, have different loan fees.
Direct Student Loans are disbursed at the beginning of each term, half in the fall and half in the spring.
Grants and scholarships will be disbursed at the beginning of each term or as funds are received by the College.
The federal government requires students loan borrowers who graduate, withdraw or drop below half time status to complete student loan exit counseling. The purpose of exit counseling is to help you understand your rights and responsibilities as a student loan borrower. Also, you will need to contact your loan servicer to update your contact information and setup a repayment plan.
Loan Exit counseling can be completed online at https://studentaid.gov/.
Your loan history and loan servicer information can be found at https://nslds.ed.gov/nslds/nslds_SA/
For more information check out the Exit Counseling Guide for Direct Loan Borrowers