Federal Direct Loans

Federal Direct Loans

Federal Direct Loans are either subsidized or unsubsidized. A subsidized loan is awarded on the basis of financial need. If the student is eligible for a subsidized loan, the government will pay (subsidize) the interest on the loan while the student is enrolled at least half-time during school and during the grace period (six months after the student graduates or falls below half-time attendance). Unsubsidized loans accrue interest during school. The student is not required to but may make payments on the interest portion of the unsubsidized loan. Depending on financial need and class level, students may receive a subsidized or unsubsidized loan, or a combination of both.

Accepting the Federal Direct Loan

If you choose to accept the Federal Direct Loan in your financial aid award, you must complete the Entrance Counseling and Federal Direct Loan Master Promissory Note (MPN) at studentloans.gov.

*Please Note: When arriving at the Federal Student Aid website, you will be prompted to login with your FSA ID Username and Password. The FSA ID has replaced what was previously the PIN number and you will need to create an FSA ID if you have not done so already.

Entrance Counseling is designed to help you better understand the terms and conditions of the Federal Direct Loan you are borrowing, as well as your rights and responsibilities before you borrow money from the Federal government.

The Federal Direct Loan Master Promissory Note is the document that makes you legally responsible for repaying your Federal Direct Loans. *Please note: when prompted to select the loan you would like to receive, select “Subsidized/Unsubsidized.”

Federal regulations require that both of these documents be completed prior to the disbursal of the Federal Direct Loans. Both of these documents are completed online at studentloans.gov and are good for up to 10 years. Returning students who have previous loans through the Federal Direct Loan program do not need to complete a new Entrance Counseling or MPN for the Federal Direct Loan program.

For more information on the Federal Direct Loan Program, please visit their website.

Exit Counseling, Repayment and Servicing

You will also be required to complete Loan Exit Counseling upon graduating or upon leaving the University of Redlands. This process is crucial and will provide you with important information in regards to repaying your loan.

You will begin repayment on your Direct Loans six months after you graduate, leave the University of Redlands, or drop below half-time. The Federal Direct Loan program offers options to students who need help with repayment of Federal Direct Loans including consolidation, deferment, forbearance, and income-sensitive repayment.

To view information regarding your Federal loan debt, please access the National Student Loan Data System (NSLDS).

Parent PLUS Loan

Parent Loans for Undergraduate Students (PLUS) are available to parents for their dependent, undergraduate students who are matriculated in a financial aid eligible program and enrolled in at least half-time. Parents of dependent students may borrow up to the cost of attendance minus any other aid through this credit-based loan program each academic year. Each parent who intends to borrow through this loan program must complete a separate application.

Step 1 – Determine actual amount needed

Using the student’s financial aid award offer and the anticipated charges associated with the current academic year, determine how much is needed to help fund the cost of a student’s tuition bill and other expenses.

Step 2 – Apply for a PLUS

To apply, go to https://studentloans.gov. The parent borrower will need their FSA ID and password to sign in. Once signed in, go to “Start PLUS Application Process,” then select “Parent PLUS.” Contact Customer Service at 1-800-557-7394 for online application assistance.

Once the application is completed, you will receive an instant credit check. 

Adverse credit history may cause your credit check to be denied. This can include bankruptcy, foreclosure, tax liens, default determination or one or more debts which are 90 days or more delinquent, in collection or charged off during the previous two years and the total combined outstanding balance of those debts is greater than $2,085.

Step 3 – If approved

If the application is approved, first-time parent borrowers must complete an online Loan Agreement for PLUS Loans (MPN) at https://studentloans.gov.   Notification of your approval will be sent to Angeles College.

If the application is denied, the parent has three options, explained in the following messages that will be displayed after completing the online application:

1. Not pursue the PLUS Loan

If the borrower is not interested in the following other two options, a borrower can select the option (while completing the application online) for their son/daughter to be offered additional Federal Direct Unsubsidized Loans. Additional loan limits are available up to $4,000/academic year for 1st and 2nd-year students.

2. Provide an endorser

The endorser must pass a credit check and sign a promissory note. An email with the Loan Reference ID and an endorser packet will be mailed to the borrower. The endorser will need the Loan Reference ID to complete the paper packet or complete the Endorser Addendum online at https://studentloans.gov. The endorser must create an FSA ID and password to sign in and go to “Endorse a PLUS Loan.”

3. “Credit Appeal — I want to provide documentation of extenuating circumstances” option:

A package of additional information will be automatically sent to the borrower and the parent will be prompted to send an email with contact information to applicant services.

*If you obtain a loan with an endorser or through an appeal you will need to complete online credit counseling (in some cases in addition to entrance counseling) at https://studentloans.gov/.

 Choose When to Pay Back

1. Repayment begins 60 days after the last disbursement of the loan for the academic year. Parent borrowers may choose to pay interest monthly, quarterly or choose to have the interest capitalized. Contact the Loan Servicer to discuss repayment options.


2. A parent may request deferrment of payments until 6 months after student graduates or falls below 6 credits.

We look forward to seeing you!