LTS' federal school code: G03286An Introduction to Federal Stafford LoansFederal Stafford loans are made available to students at a relatively low fixed interest rate (6.8%) by the U.S. Department of Education, to cover educational costs including tuition, books, fees, housing, food, living expenses and transportation. Graduate students can be eligible to borrow up to $20,500* per year through the Stafford loan program. There are 2 kinds of Stafford loans: interest is not charged on Need-Based (Subsidized) loans until you finish studying or drop below 6 credits per semester, whereas it is charged on Non-Need-Based (Unsubsidized) loans throughout. The $20,500 maximum includes both need-based and non-need-based loans. Of this total, the maximum portion that the government permits to be need-based is $8,500. You must begin repaying your federal Stafford loans when you finish studying or drop below 6 credits per semester.
The purpose of the federal Stafford loan program is to cover educational expenses. Loans are issued to students with the expectation that they will attend, and through their attendance gradually "earn" the funds. When a student is no longer attending (due to completion of studies, leave of absence or withdrawal), or drops below 6 credits per semester, s/he is no longer "earning" those funds. If a student's enrollment status changes after the semester has already begun, s/he may be required to return a portion of the loan, depending on the timing of the enrollment change.
To learn the finer points on Stafford loans, visit http://www.studentaid.ed.gov/ and consult the LTS Financial Aid Handbook.
* By law, M.Div. students without a Bachelor's degree are subject to lower annual borrowing limits. For full details, see Section 2 of the LTS Financial Aid Handbook.
To qualify for a federal Stafford loan, you must. . .
Stafford loans for LTS students are certified through the LTS Office of Financial Aid. Full Step-by-step instructions are provided on the LTS Financial Aid Application Form and in the LTS Financial Aid Handbook.
First use our Seminary Student Cost Calculator and refer to the LTS Fee Schedule to project seminary charges. For financial planning tips and step-by-step guidance in assessing your projected expenses and income, use the Determining Your Financial Need worksheet. Then consult our guidance sheet, Keeping Your Education Debt Manageable. Finally, make an informed decision on how much Stafford to request. Enter this on the LTS Financial Aid Application form. Borrow only what you need. Avoid borrowing money to subsidize an enhanced lifestyle; loan funds disappear and are quickly replaced by loan repayment.
While it is possible to change the amount of your loan later (see 10 below), plan carefully as you complete your LTS Financial Aid Application Form before you begin studies. Changing the amount of your loan after school has started can add stress for you.
Your LTS Financial Aid Application Form helps us to see your larger financial picture, and provides space for you to comment on aspects of your particular situation that may not be evident on your FAFSA. Your responses to the FAFSA questions are entered into a federal formula to yield your Expected Family Contribution. The EFC measures your family's financial strength for the purposes of determining financial aid eligibility. After completing the FAFSA, you will receive a Student Aid Report from the U.S. Department of Education telling you your EFC. LTS then follows federal procedures to calculate your borrowing eligibility based on the following variables:
For a copy of the standard Cost of Attendance budget associated with your program/enrollment status (tuition, books, fees, housing, food, living expenses, transportation), contact the Financial Aid Officer. Because federal funds are reserved for expenses that the individual student incurs for his/her educational program, the U.S. Department of Education stipulates that a standard single-student budget be used for all students. A few core components of ours are based on the College Board's regional nine-month Moderate Living Expense Budget. Allowances for household size and other factors that could affect how much you are able to pay towards your education are taken into account in the federal formula used to determine your EFC.
For new students, your LTS Financial Aid Award Letter (sent with your acceptance letter, if you've applied for financial aid as part of the process of applying for admission to LTS) shows how much you qualify to borrow, up to the amount you have requested on your LTS Financial Aid Application Form. After we have received your entrance deposit and confirmation that you'll be attending LTS, we will proceed with certifying your loan ("connecting the dots" between you and the lender you have chosen). Certification is the final step in preparing loans to be disbursed when school begins. For returning students, loans are processed over the summer between academic years, and notices generally sent mid-summer (loans for students enrolled in summer classes are processed first). When your loan is certified, you will receive in the mail:
...READ AND FILE THESE so you can plan ahead for when the money will arrive.
Federal regulations require you to be in attendance at the time your Stafford funds are delivered to you. Be sure to plan your course registration and personal finances accordingly.
LTS’ academic year is composed of 2 semesters. Semester 1 includes 3 modules: Summer, September, and Fall. Semester 2 also includes 3 modules: January, Spring, and May. When your loan is certified, your disbursement dates are scheduled according to the modules you projected you would attend on your LTS Financial Aid Application form. If your actual registration changes, your disbursement dates will be adjusted.
Disbursements come in 2 equal amounts at the beginning of each semester: 50% in Fall and 50% in Spring. For single-semester loans (like those starting in Spring), 50% of the money comes at the beginning of the semester, and 50% after the midpoint.
Before the disbursement arrives, our Business Office will contact you to ask, in the event that your loan results in a credit balance on your account, how you would like the credit to be handled: kept in your account, refunded to you, returned to your lender, or a combination. As scheduled, the disbursement will come directly to our Business Office, and within 3 days it is credited to cover any charges on the account. Within 14 days, a check for any credit balance can be picked up from the Business Office if you have requested it.
You can request to change the amount of your loan (increase or decrease) by completing a Loan Revision Request Form. Within 1-2 weeks, we will let you know whether your request is approved, and when the additional money will come (in the case of an increase) or be cancelled.
Understanding loan repayment up front is a key to making wise borrowing decisions. As you consider how much you can afford to borrow while in school, be sure to review the repayment projection charts on our Keeping Your Education Debt Manageable guidance sheet. After you graduate, leave school, or enroll for fewer than 6 credits per semester, you will have a six-month "grace period" before you begin repayment. During this period, you'll receive repayment information and notification of your first payment due date. Payments are due monthly. Visit www.youcandealwithit.com/ for information on Stafford loan repayment as well as other financial planning resources designed for students by American Education Services.
While you are in school, it makes good sense for you to regularly pay the interest for your Unsubsidized loans to avoid having it capitalized (added to the loan principal) at the end of your grace period.
These changes can affect your eligibility at any time before or during the academic year:
Each time such changes occur, we re-check your eligibility. If a change necessitates a reduction or allows for an increase in your borrowed amount, we will contact you regarding how to proceed. Loan eligibility will only be reduced if needed to keep your total aid within federal limits. Keep in mind: it's always better to receive scholarships and contributions (which you don't have to pay back) and end up having to return some of your loan money (which you do have to pay back).
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