Educational Loans

Federal Direct Student Loans

The most common types of student loans that are offered to students are Federal Direct Loans. There are two types of Federal Direct Loans; Federal Direct Subsidized Loans and Federal Direct Unsubsidized Loans. Federal Direct Student Loans are offered after a student has been admitted to UNK and completes their Free Application for Federal Student Aid (FAFSA).

Students may accept the amount of Federal Direct Student Loans that they have decided to borrow by logging into MyBLUE. Students do not have to accept the full amount of the loans, and may enter any partial amount that is decided to be borrowed. A borrower may also contact the Office of Financial Aid to reduce the amount of loan that has been accepted.

Federal Direct Subsidized Loans

Federal Direct Subsidized Loans have slightly better terms to help out students with financial need. 

• Federal Direct Subsidized Loans are only available to undergraduate students with financial need. 

• Your school determines the amount you can borrow, and the amount may not exceed your financial need. 
• The U.S. Department of Education pays the interest on a Federal Direct Subsidized Loan: 
  • While you’re in school at least half-time, 
  • For the first six months after you leave school (referred to as a grace period), and 
  • During a period of deferment (a postponement of loan payments). 

Federal Direct Unsubsidized Loans

• Federal Direct Unsubsidized Loans are available to undergraduate and graduate students; there is no requirement to demonstrate financial need. Graduate students only qualify for Federal Direct Unsubsidized Loans. 
• Your school determines the amount you can borrow based on your cost of attendance and other financial aid you receive. 
• You are responsible for paying the interest on a Federal Direct Unsubsidized Loan during all periods. 

• If you choose not to pay the interest while you are in school,during grace periods, or deferment or forbearance periods, your interest will accrue (build) and be capitalized (that is, your interest will be added to the principal amount of your loan). 

*Note: Interest payments to a Federal Direct Unsubsidized Loan do not have to be made while in school. However, the Office of Financial Aid encourages borrowers to begin making the interest payments in order to minimize the total debt owed when finishing school. Making the interest payments keeps the loan debt from inflating beyond the original principle amount borrowed. 

Students who are borrowing a Federal Direct Student Loan for the first time* are required to complete Entrance Loan Counseling and a Master Promissory Note before the loan can be disbursed out to their account. (*If you previously borrowed a Federal Direct Loan as a current undergraduate student, you should have already completed the Entrance Loan Counseling and Master Promissory Note and will not be required to complete these items again.) 

Entrance Loan Counseling 
Students may access the entrance loan counseling session on the Department of Education's StudentAid.gov website. Once you complete this online session, the UNK Financial Aid Office is notified. If you want to check to see if your confirmation has been received in our office, please review your MyBLUE To-Do List. Once this requirement has been met, it will be removed from your checklist.  

Master Promissory Note 
As you begin to borrow for your educational expenses, it is important that you are aware of the loan's terms and conditions. These stipulations govern the rights and responsibilities you have as a borrower. When you sign the Master Promissory Note (MPN), you enter a legal and binding contract (according to the terms and conditions listed). 

Annual Student Loan Acknowledgement 
The Annual Student Loan Acknowledgment is a tool to help you understand how your loans will affect your financial future. 

Completing the Annual Student Loan Acknowledgment will help to: 

• Make informed choices by showing students (and parents) how much they owe in Federal debt before agreeing to borrow more money to pay for their higher education. 

• Learn the borrower’s obligations by calculating the monthly payments and the median salary that students can expect to receive after graduating from a specific program. 
• Understand the balance for repayment by breaking down basic loan concepts such as interest accrual and capitalization and the difference between private and Federal loans. 

While this is not a requirement, we highly recommend that you complete the online Annual Student Loan Acknowledgement for your benefit. 

Exit Loan Counseling 
If you have borrowed student loans to help pay for your education and you either apply for graduation from UNK, withdraw from classes, or drop below half-time enrollment, you will be notified of opportunities to attend an Exit Loan Counseling session. Exit Loan Counseling is required for students graduating from UNK. If you will be graduating from UNK and have not yet completed the Exit Loan Counseling session, you will see a reminder on your “To Do List” on MyBLUE. Once you have completed a group counseling session or an online counseling session, the reminder will be removed from your “To Do List.” The purpose of Exit Loan Counseling is to help you become well prepared and knowledgeable regarding the repayment of the student loans you have borrowed.

An interest rate is additional money that you will have to pay on top of your loan. The faster you can repay your student loan, the less amount of interest you will pay. An origination fee is an extra fee added to your loan for the cost of services rendered to set up the loan. Make sure you borrow enough loan to cover your UNK costs as well as the origination fee.

Current Rates: Interest Rates for Federal Direct Loans borrowed July 1, 2023 - June 30, 2024:

Federal Direct Loan Rates

→ Subsidized Undergraduate Loans: 5.49% fixed
→ Unsubsidized Undergraduate Loans: 5.49% fixed
→ Unsubsidized Graduate Loans: 7.05% fixed

List of Past Interest Rates

Federal Direct Loan Origination Fees

→ Subsidized and Unsubsidized Undergraduate Loans: 1.057% origination fee
→ Unsubsidized Graduate Loans: 1.057% origination fee

Federal Direct PLUS Loans are part of the Federal Direct Loan Program and are financed by the federal government. PLUS loans are borrowed by the parents of dependent students as a way to help finance education expenses. A student's cost of attendance minus all other financial assistance (as determined by the school) is the maximum that may be borrowed. Unless the borrower specifies deferred payments in the loan request, repayment begins after the full loan has been disbursed.

The interest rate is fixed at 8.05% for the 2023-24 academic year. Interest is charged during all loan periods, starting on the date of the loan’s first disbursement. An origination fee of 4.228%, will be deducted from the borrowed principal and the resulting net loan will be applied to the student account. 

• The borrower must be a U.S. citizen or an eligible non-citizen who is the student’s current biological, adoptive, or step-parent. 
• The dependent student must be enrolled at least half-time at UNK. 
• The application for the Federal PLUS Loan includes a credit check; borrowers must either have a good credit history or an endorser who has good credit. 

• Borrowers must not be in default on any federal education loans or owe an overpayment on a federal education grant. 
• If denied, parents may appeal, or they may have an endorser co-sign the loan. 
• Additional Federal Direct Loan may be available for students whose parents have completed the loan request and are not eligible for the Federal Direct PLUS Loan. 

If a parent would like to apply for PLUS Loan funding, he or she may do so by: 

• Completing the Parent Plus Loan Application. 

• Ensuring that he or she has completed a Parent Plus Master Promissory Note at studentaid.gov at least once. 
• The UNK Financial Aid Office strongly encourages parents of dependent students to consult with a Financial Aid Counselor before applying for a Parent PLUS Loan by calling the financial aid office at (308) 865-8520 or emailing finaid1@unk.edu.

The Federal Direct Graduate PLUS Loan enables graduate students to borrow additional loan from the U.S. Department of Education to help pay educational expenses. This loan is a more expensive loan with significantly higher interest rates and origination fees, and as such is available to a student only after exhausting all other Federal Direct Student Loan eligibility within a school year. An applicant’s credit is checked by the Department of Education to determine eligibility for this loan. 

Some general terms are as follows: 

• Borrowers must be U.S. citizens or permanent residents. 
• Fixed Interest Rates (set annually) 
• Origination fee of 4.228% reduces net proceeds 
• Deferred repayment while enrolled at least half-time 
• Combined repayment servicing with other federal student loans 

Contact the UNK Office of Financial Aid for more details and for information regarding the application process for this loan. 

An aggregate limit is the total amount of Federal Direct Student Loan that a student can borrow within one academic year (fall, spring, and summer semesters). The chart below shows the aggregate loan amounts per year based off of a student's grade level.

Undergraduate

*If a student is classified as an independent student as determined by the FAFSA or if the Parent PLUS Loan was denied, he or she would receive the specified additional amount of Federal Direct Unsubsidized Loan eligibility depending on grade level.

**This total amount does not include the extra amount of Federal Direct Unsubsidized Loan a student may qualify for if independent or if the Federal Direct Parent PLUS Loan was denied. To get the total amount for these students, add the number in the independent column for their grade level to the total in their grade level.

Graduate

The annual aggregate amount of loan a graduate student may qualify for each year is $20,500.00. The lifetime aggregate amount of loan a graduate student may borrow is $138,500.00*.

*This amount includes what the student has borrowed as a graduate student and as an undergraduate student.

The Federal Student Aid Website

The Federal Student Aid website, StudentAid.gov, is the U.S. Department of Education's (ED's) central database for student aid. This website is a one-stop location to access almost anything related to federal financial aid. 

How to Use the Federal Student Aid Website 

• StudentAid.gov will keep track of all educational federal loans (i.e. Subsidized, Unsubsidized, Parent PLUS, and Grad PLUS) borrowed by a student or parent from any institution.  
• Parents and students can log on to their dashboard on StudentAid.gov using their FSA ID; the same login information used to access the FAFSA.  
• On your account dashboard, you can view all of your federal loan debts and the interest that has been collected.
• You can view repayment plans, repayment due-dates, and how to repay your loan(s).
• A loan servicer is a company that the federal government assigns to handle the billing and other services on your federal student loan on their behalf. If you want to change your repayment plan or have questions about your loan payments, you will contact your loan servicer. You can click "View Loan Servicer Details" to find out who your loan servicer is.

Sample Loan Repayment Schedule

Once you have graduated, withdrawn from all classes, or drop below half-time enrollment, you will have a six-month grace period before your federal student loans go into repayment. The default repayment plan that you will be put on is the standard, or level, repayment plan. (you can change your repayment plan by talking to your loan servicer) This will spread your payments into equal amounts each month and the repayment plan is for 10 years. This is the least costly plan, as you will pay the least in interest charges. See the sample loan repayment schedules below for the different levels of student loan debt.

Sample Standard Repayment Plan Schedule

Fixed-Interest Rate: 3.99%

A loan servicer is a company that the federal government assigns to handle the billing and other services on your federal student loan on their behalf. To see who your Loan Servicer is, log into studentaid.gov. Below is a list of Loan Servicing Centers for Federal Student Loans and their contact information.

DEPARTMENT OF EDUCATION LOAN SERVICING CENTERS INFORMATION

A private student loan is a loan offered for higher education by banks, credit unions, and online lenders. Private loans require a separate application directly to the financial institution acting as a private lender. Federal loans have fixed interest rates, while the private loan interest rates are largely dependent on credit history. 

UNK uses the ELM Select Tool to provide a historical listing of private student loan lenders students have borrowed from over the past two years. UNK does not recommend any specific lender, but provides this list as a resource and a service to students seeking loan aid above and beyond their federal student loan eligibility. As a borrower, you may use any lender you choose. The lender does not have to be one that appears on this list. You may do a more extensive search for Private Student Loan lenders online or otherwise and UNK will process your loan with any lender you choose to utilize. 

The ELM Select Tool allows you to compare the terms of several Private Student Loan lenders including: interest rates, cosigner requirements, repayment length and other important loan information to help with your borrowing decision. Take these next steps to access our historical listing of Private Student Loan lenders:

• Visit UNK’s ELM Select Tool 
• Select your degree level 
• View the disclosures and additional resources within the ELM Select Tool 
• Select ‘View Loans’ to access the Private Student Loan lender listing and loan terms 

As an important note, students pursuing private educational loans must sign an Applicant Self-Certification form and submit this form to the private lender before the loan may be disbursed.