STCC Financial Aid - Loans

Springfield Technical Community College participates in the William D. Ford Federal Direct Stafford Student Loan program administered by the U.S. Department of Education and STCC. Students awarded a Direct Loan will borrow directly from the federal government. Loans are financial assistance that must be repaid six (6) months after you leave school or drop to less than six credits. Students must also maintain satisfactory academic progress as defined by the financial aid satisfactory academic progress policy. To obtain more information on the Federal Direct Lending program, please call 1-800-848-0979 or visit their web site at www.direct.ed.gov.. To track your academic loans throughout your career at STCC or elsewhere, please visit the National Student Loan Data System at www.nslds.ed.gov. *Please note that the Federal Direct Stafford Student Loan program is different from FFELP (Federal Family Education Loan Program). STCC does NOT participate in any other loan program other than Direct Lending for the Stafford Loan. Alternative loans are available to students; for more information on alternative loans, please see the bottom of the page.

There are two types of Federal Direct Loans. Subsidized loans are based on financial need. Interest is not charged while you are in school enrolled for at least six (6) credits. Unsubsidized loans are non-need based. Interest accrues from the time the loan is disbursed until it is paid in full with interest. Effective July 1, 2014, subsidized and unsubsidized loans disbursed on or after this date will accrue at an interest rate of 4.66%. You have the option of paying the interest quarterly or deferring it until repayment.   Please check your Webadvisor account for the type and amount you are eligible for.

You have the option of borrowing the entire amount offered in your award letter, reducing the amount(s) offered, or declining the loan. Your decision about what and how much to borrow does not affect your future eligibility for financial aid or future loan amounts. There are maximum loan limits that you cannot exceed based on your dependency status and number of credit you have completed at STCC.

  • Annual Amounts - The amount a student is eligible to borrow appears on the award letter and is based on the chart below:

Dependent Student

Credits Completed                                                       Amount

0-26 credits                                        $3,500*Sub/$2,000 additional Unsub**

27 or more credits                              $4,500* Sub/$2,000 additional Unsub**

Independent Student

Credits Completed                                                       Amount

0-26 credits                                        $3,500* Sub/$6,000 additional Unsub**

27 or more credits                              $4,500* Sub/$6,000 additional Unsub**

*There is a 1.072% origination fee for loans disbursed after December 1, 2013. Check your Disclosure Statement from Direct Loan to see exact amounts.

**Discretion of the Financial Aid Office to award any additional loan monies.

  • Aggregate Limits - The maximum amount a student may borrow during their academic career is listed below:
    • Dependent Students: $31,000 (no more than $23,000 of which can be subsidized)
    • Independent Students: $57,500 (no more than $23,000 of which can be subsidized)
  • To Decline the Loan(s) - Email loans@stcc.edu stating you want to decline your loan.
  • To Reduce the Amount Offered - Email loans@stcc.edu with the award amount change.
  • Receiving Loan Funds - In order to process a direct loan you must complete a Master Promissory Note (MPN). The (MPN) is the legal agreement you make to borrow and repay this money.  All students must electronically complete their Master Promissory Notes (MPN) at www.StudentLoans.gov. In addition to the completion of the promissory note, all first time borrowers at STCC must complete entrance counseling.
  • Entrance Counseling - All first time borrowers at STCC must complete an entrance counseling session. This session provides you with valuable information on your rights and responsibilities as a direct loan borrower. Please plan to be in the office for at least 30 minutes to complete this requirement. Students who do not attend Entrance Counseling (if required) or submit their MPN's will have their loans cancelled. All charges on your account will then become your full responsibility. You must be enrolled at least half-time (6 credits) and continue to attend 6 credits at the time of disbursement to be eligible for a Direct Loan.
  • Leaving School or Falling Below Six Credits - This will begin the 6-month grace period leading to repayment of your loan(s). You must complete Exit Counseling, which is a review of your borrower rights and responsibilities. If you return to STCC or another school on a half-time or more basis you should request an in-school deferment form to notify the servicing agency that you are able to postpone repayment of your loan. Contact your servicer for this form and submit it to the school's Registrar Office to verify your enrollment status.
  • Repayment - Direct Loan assigns you to a Servicer who will contact you by mail. The Servicer is your direct point of contact until the loan is paid in full. If you are unsure who your servicer is call 1-800-433-3243. Examples of servicers are: Pheaa, Great Lakes, Sallie Mae and Nelnet. Your Servicer will contact you at your last known address to inform you about going into repayment. There are different repayment options to choose from that will determine your monthly payments and length to pay off your loan. Once you enter repayment, Direct Loans will send you a monthly payment or coupon booklet with information where to send your payment. You can also sign up for online payments. You are responsible for notifying Direct Lending and the Financial Aid Office of any changes to your name or address. Failure to make payments will result in a default that will affect your ability to obtain further financial aid at any school and will directly impact your ability to obtain consumer credit in the future.

Borrowing money for your education is a serious and binding legal obligation. You are advised to use care in determining if and how much you should borrow. Please do not hesitate to ask for assistance in making this decision. Your loans are a part of your present and your future.

The average loan debt for STCC's 2012-2013 graduates is: $7,977.85.

  • Deferments - A deferment is a period in which repayment of the principal balance is postponed. During a deferment, if the loan is subsidized, the government pays the interest charged. For Direct Unsubsidized, PLUS, Unsubsidized Consolidation, and PLUS Consolidation Loans in deferment, you are responsible for the interest that accrues during the deferment period. If you have unsubsidized loans, when you re-enter repayment at the end of the deferment period, any unpaid interest capitalizes (is added to the principal balance). You may go online to get an estimate of how much interest might capitalize at the end of your deferment by going to www.finaid.org/calculators. There are several deferment types; for a listing of all deferments available, please click on https://www.dl.ed.gov/borrower/DefermentFormList.do?cmd=initializeContext.
  • Alternative Loans (Student & Parent PLUS) - Student alternative loans (also called private loans) are different from federal student loans in that they are not guaranteed by the federal government and require a credit check and often a co-signer. Alternative loans should be used as a last resort after exploring all other forms of financial aid. Some programs such as noncredit programs are ineligible for financial aid. Parent PLUS loans are available to parent(s) of dependent students attending at least half time. The interest rate is fixed at 7.21% with credit history being  reviewed by the lender.
    • Forbearance  A postponement of repayment due to economic hardship. Interest on both subsidized and unsubsidized loans are charged during this time.
  • If you need more information regarding an alternative loan, please contact the STCC Financial Aid Office at (413) 755-4214.