Financial Aid Basics - Loans

Student Loans

Unlike grants and work-study, are borrowed money that must be repaid, with interest.  Being loans are a legal responsibility, it is important to look at them as a last resource to pay for your education. 

Aims Community College participates in the William D. Ford Direct Loan Program, also known as Direct Loans.  Eligible students and parents borrow directly from the U.S. Department of Education.  Direct Loans include subsidized and unsubsidized Direct Stafford Loans and Direct PLUS Loans. 

The interest rate for these loans depends on when the loan was borrowed.  Loans borrowed as of July 1, 2008 have the following rates:

• Subsidized Stafford Loans: fixed rate of 6.0%
• Unsubsidized Stafford Loans: fixed rate of 6.8%
• Plus Loans: fixed rate of 7.9%

Current interest rate information for loans borrowed prior to July 1, 2008 can be found on the Direct Loan website at www.dl.ed.gov

In addition to interest, there are fees associated with these loans.  Loans borrowed after July 1, 2008;

• Subsidized and Unsubsidized Stafford loans have an origination fee of up to 2.0% of the loan amount borrowed  
• PLUS loans have an origination fee of up to 4% of the loan amount borrowed

The fee will be deducted proportionally from each payment of the loan to the school. This means the amount paid to school will be slightly less than the amount you have borrowed and must repay.

Subsidized Stafford Loans: 

The student must show financial need, as determined by the Financial Aid Office, and be enrolled at least half-time to receive a Subsidized Stafford Loan.  The U.S. Department of Education will pay the interest that accrues on this loan type during periods of half-time enrollment, the grace-period and periods of deferment.  Once the loan goes into repayment, the borrower is then responsible for the payment of the loans principal and interest.

Unsubsidized Stafford Loan: 

Financial need, as determined by the Financial Aid Office, is not required for the Unsubsidized Stafford Loan.  However, the student must be enrolled at least half-time.  The borrower (student) is responsible for the payment of the interest, in addition to the amount borrowed, from the times the loan is paid on his/her behalf until it is paid in full. 

PLUS Loan: 

Parents of dependent students can borrow from this loan program to help pay the cost of their student’s undergraduate education.  This loan is credit based.  Aims requires that a FAFSA be filed for students whose parents would like to borrow through the PLUS Loan program.  In addition, the student and parent must complete an Aims PLUS Request form.