undergraduate bulletin - LaGrange College

The Federal William D. Ford Direct Loan is a low-interest, repayable loan available to
undergraduate and graduate degree-seeking students made through the U.S. Department of
Education, the lender. The Federal Direct Loan Program consists of a subsidized and an
unsubsidized loan.
Subsidized loans are awarded on the basis of financial need, with the federal government paying
interest on the loan until repayment begins, and has a fixed interest rate of 3.4% for loans
disbursed between 07/01/2011 and 06/30/2012. An unsubsidized loan is available to students
regardless of financial need. However, interest accrues from the time the loan is disbursed until it
is paid in full. The borrower has the option to pay the accruing interest or to allow the interest to
accrue and capitalize. The interest rate on an unsubsidized Direct Loan is a fixed rate of 6.8%.
Federal Direct Loans are subject to an origination fee of 1% that will be deducted from the loan
amount.
The annual subsidized/unsubsidized Direct Loan limit for a dependent undergraduate is $5,500
for first-year students, $6,500 for sophomores, and $7,500 for juniors or seniors. The annual loan
limits for an independent undergraduate is $9,500 for first-year students, $10,500 for
sophomores and $12,500 for juniors and seniors. Federal Direct Loans are delivered to the
borrower in two (2) separate disbursements, one at the beginning of the enrollment and the
second at the middle of the loan period.
Repayment of a Federal Direct Loan begins six (6) months after the borrower graduates,
withdraws, or ceases enrollment as at least a half-time student. The standard repayment period
for a Federal Direct Loan is ten (10) years; however, there are longer and more flexible
repayment options available to borrowers.
A Federal Direct Parent Loan for Undergraduate Students (PLUS) is available to the parents
of a dependent student to defray remaining educational expenses after all other financial aid
resources are exhausted. Eligible applicants may borrow up to the cost of attendance less other
financial aid. The interest rate is a fixed rate of 7.9%, and interest accrues from the time of
disbursement until the loan is paid in full. Unlike the Federal Direct Loan program, PLUS
borrowers must be credit-worthy in order to qualify for this loan, and repayment begins within
60 days of the loan disbursement. Federal Direct PLUS Loans are subject to an origination fee of
2.5%, which will be deducted from the loan amount before disbursement.
STUDENT EMPLOYMENT
There are part-time job opportunities available to eligible students through the Federal Work-
Study Program and LaGrange College‘s Work Aid Program. Jobs are available on campus and
off-campus in community service activities. Funding in these programs is limited. Students
interested in student employment must complete the FAFSA. The average student assignment is
10 to 15 hours per week. Student employment awards are made on a first-come, first-served
basis until funds are depleted.
Federal Work-Study, a federally-funded student employment program, provides employment
opportunities for undergraduate and graduate students with financial need to defray educational
expenses through employment in on-campus departments or off-campus community service
activities.
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