Direct Loans are available to all US citizens or permanent residents with a valid social security number who have a high school diploma and are not in default on any previous student loans. Male students also have to be registered for Selective Service.
Step 1: Free Application for Federal Student Aid
You will need to complete the Free Application for Federal Student Aid (FAFSA). We will use the information from your FAFSA to assist in determining your eligibility for a Direct Subsidized Loan and/or a Direct Unsubsidized Loan.
In addition to completing a FAFSA, you will need to be accepted in a degree-granting program (ie BA or MA) at our school on at least a half-time basis and meet other eligibility requirements such as maintaining Satisfactory Academic Progress (SAP) and being within the borrowing limits for Direct Subsidized Loans and Direct Unsubsidized Loans.
Step 2: Award Notification
Once you Student Aid Report (SAR) is available email email@example.com, we will review your SAR and after we determine your eligibility for a Direct Subsidized Loan and/or a Direct Unsubsidized Loan, we will email you with the loans and amounts for which you are eligible.
This will depend upon your intended program of study, Estimated Family Contribution, other funding and Cost of Attendance. If you do not wish to borrow the full amount indicated in the email, you must contact Student Services to cancel or reduce your loan amounts.
Depending on your status, we may also include information about a Direct PLUS Loan award for which you or your parent may be eligible. (If you are a graduate/professional student, you may be eligible for a Direct PLUS Loan; if you are a dependent undergraduate student, your parent may be eligible for a Direct PLUS Loan.)
Step 3: Direct Loan Master Promissory Note Completion
You will need to confirm the loans you wish to take out, including PLUS loans.
Once the loan amounts have been agreed you must complete a Master Promissory Note
You must complete a new Direct Loan Master Promissory Note (MPN) for each loan type you wish to borrow. Although you may have previously signed an MPN to receive FFEL or Direct Loan Program loans, these MPNs cannot be used to make Direct Loans at LCDS.
The MPN is the legal document through which you promise to repay your Direct Loans and any accrued interest and fees to the Department. It also explains the terms and conditions of your loans. In some cases, a Direct Loan MPN can be used to make loans for up to ten years. However, you will need to complete a new Direct Loan MPN each academic year that you receive a Direct Subsidized Loan and/or a Direct Unsubsidized Loan at our school.
Step 4: Direct Loan Entrance Counseling Completion
You must complete Direct Loan Entrance Counseling each year before you can receive a Direct Loan.
You will also be required to complete Exit Counseling shortly before you complete your studies.
Federal Student Aid also have Financial Awareness Counseling at StudentLoans.gov Whilst this is not compulsory you may find it of use when planning your borrowing and spending.
Step 5: Loan Certification
Once you have completed the required processes as outlined above, we will originate (certify) the loans and send a confirmation letter to you. You will be able to use this letter to support your visa application.
Federal loans will be disbursed in 3 instalments and must be allocated to any due Tuition Fees first.
Please note that once originated loan information will be sent to the National Student Loan Data System.
As you can see this is a long process. In order for you to have your payment disbursed in time for the start of session you will need to have completed your FAFSA and signed the MPN by early July if possible. You will also need proof of funding for your visa application.
Step 6: Disbursement of Funds
The first instalment will not be available to LCDS until you have completed the first month of your course of study. Subsequent instalments will be available at the beginning of each term.
Before each disbursement LCDS is required to confirm you are still eligible to receive funds. This includes ensuring you are making Satisfactory Academic Progress and are studying 'at least half time'.
The loans will be disbursed to LCDS who will then arrange to convert the loans to pounds sterling. Once we know the amount in pounds received the money is allocated to tuition fees as laid down in the US Dept of Education regulations before any excess is returned to you. You will then be notified of how the loan has been allocated.
Excess funds are returned to you in GBP.
Please note any PLUS loan is allocated to your Institutional charges before the subsidized and unsubsidized.