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Federal Student Loans

Loans are a helpful way to finance your college experience. Federal student loans are financial aid funds that you must repay with interest. It is important to remember that you will be that you will be responsible for the repayment of these funds, typically 6 months, after graduation or if you drop below half-time (6 credit) status during the Fall or Spring semester.

Important Things to Know About Federal Student Loans

  • All student loans are subject to annual maximum amounts, and the student must be the applicant/borrower.
  • Institutions that enter into an agreement with a potential student, current student, or parent of a student regarding a Title IV, HEA loan are required to inform the student or parent that the loan will be submitted to the National Student Loan Data System (NSDLS), and will be accessible by guaranty agencies, lenders, and institutions determined to be authorized users of the data system.
  • For detailed information about your Federal Direct loan borrowing history including contact information for your Federal Direct Loan servicer, visit the National Student Loan Data System (NSLDS).

General Eligibility for Federal Financial Aid Programs

  • Must file a Free Application for Federal Student Aid (FAFSA) each year.
  • Must be admitted as a matriculated student in a degree or certificate program at Pace University.
  • Must be enrolled in at least 6 credits per semester (except for Pell Grants).
  • Must be making Satisfactory Academic Progress towards a degree.
  • Must be a U.S. citizen or eligible non-citizen (permanent residents, certain refugees)
  • Must not be in default of a federal student loan.
  • Must not owe a repayment on a federal student grant.
  • Must have and provide a valid Social Security Number.
  • Combination of federal aid and all other aid received may not exceed the Cost of Attendance.

Undergraduate Loans

Graduate Loans

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Pace University Student Loan Code of Conduct

Pace University is committed to student-centered loan processing. The University has participated in the Direct Loan program in which loans are provided directly from the federal government to students since the 1994-1995 school year. Pace Financial Aid staff certify and transmit all federal loans directly to the Common Origination and Disbursement Center of the Department of Education.

With regard to private/alternative (non-federal) educational loans, Pace Financial Aid staff will certify any loan of the student’s choice. We do not endorse any particular lender. Neither do we participate in any of the following practices with lenders:

  • Revenue-sharing arrangements with any lender
  • Receiving gifts from a lender, a guarantor, or a loan servicer
  • Contracting arrangement providing financial benefit from any lender or affiliate of a lender
  • Directing borrowers to particular lenders, or refusing or delaying loan certifications
  • Offers of funds for private loans
  • Call center or financial aid office staffing assistance
  • Advisory board compensation

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Federal Direct Subsidized and Unsubsidized Student Loans

  • Undergraduate students are eligible for both subsidized and unsubsidized Federal Direct Student loans. These are federally sponsored, low-interest student loans with more flexible repayment options.

    Subsidized loan recipients pay no interest during the period of enrollment and for a six-month grace period after the last day of their final semester or if they fall below continuous fall/spring part-time (six credit) enrollment.

    Undergraduate students who have been accepted to a degree or certificate program and demonstrate financial need may qualify for a Subsidized loan of up to $3,500 for the freshman year (up to 31 credits earned), $4,500 for the sophomore year (32 to 63 credits earned), and $5,500 for junior and senior years (64 or more credits earned).

    Undergraduate students who do not show financial need may receive an Unsubsidized Direct Student Loan for the same amounts in addition to their standard Unsubsidized loan of $2,000. Interest accrues on the Unsubsidized loan as soon as the loan is disbursed.

    Independent undergraduate students (ineligible for Parent PLUS loans) or Dependent undergraduate students whose parents have been credit-denied a Federal Direct PLUS Loan (see below) may borrow an additional Unsubsidized Direct Loan of $4,000 per year as a freshman or sophomore and $5,000 per year as a junior or senior.

    Interest begins accruing on Unsubsidized loans as soon as the loan is disbursed. We strongly recommend that the student make interest payments on these loans while in school to avoid having the interest added to the principal balance of the loan after leaving school.

    All applicants, regardless of income level, are required to file the Free Application for Federal Student Aid (FAFSA). The Financial Aid Office will calculate the student's eligibility for Federal Direct Loans based on the student's estimated family contribution (EFC), as determined by the FAFSA, and include them in the Financial Aid Offer. Once the student accepts a Federal Direct Loan, the Financial Aid Office will originate the loan with the Department of Education's Common Origination and Disbursement Center (COD) beginning approximately June 1st and on a daily basis thereafter.

    • The student will then need to sign the Master Promissory Note (MPN) for the Direct Stafford Loan on the Federal Student Aid website (if the student has not previously borrowed a Direct Loan and signed an MPN).
    • First time borrowers must also complete Loan Entrance Counseling before the loan funds can be disbursed to their college accounts. This requirement can also be satisfied online on the Federal Student Aid website.

    To qualify for a Federal Direct Stafford Loan, students must meet all of the general eligibility requirements listed above on this page.

    Students are currently charged an origination fee that is assessed on the face value of each loan borrowed. This fee is deducted prior to disbursement of funds. Repayment of the principal on these loans begins six months after graduation or after the student ceases to be enrolled for at least 6 credits per semester. The minimum monthly installment is generally $50 including interest. The interest rate for new Subsidized and Unsubsidized Direct Stafford loans first disbursed on or after July 1, 2016, is a fixed rate. The standard repayment period is 10 years, but students may extend repayment under the Consolidation Loan Program or by selecting the Graduated, Extended, Income-Based, Pay as you Earn, or Income-Contingent repayment plan. The aggregate borrowing limit for undergraduate study is $31,000 for Dependent students and $57,500 for Independent students. Of those aggregate amounts, up to $23,000 may be borrowed in the form of a Subsidized Stafford Loan.

    Repayment of the whole or part of the loan may be made in advance at any time without an interest penalty. Borrowers may defer repayment for up to three years while the student serves in the Armed Forces, Peace Corps, or as a full-time volunteer in VISTA.

  • Graduate students may borrow Federal Direct Unsubsidized Student loans while they complete their program of study. Interest accumulates on unsubsidized loans while the student is attending college. Students should pay this interest while they are in school. Students may receive unsubsidized loans regardless of financial need.

    Graduate students may borrow a maximum of $20,500 per academic year in unsubsidized loans.

    For more information about interest rates and Stafford loans, visit Federal Student Aid.

Federal Direct Parent and Graduate (PLUS) Loans

  • Eligible parents of a dependent, undergraduate student may borrow up to the full Cost of Attendance minus other financial aid, for each academic year for a child matriculated into to a degree or certificate program. Parent loans have a fixed interest rate. Loan repayment begins within 60 days after disbursement. However, parents may request a deferment (from the federal Loan Origination Center) until six months after the student graduates or cease to be enrolled in at least 6 credits. The standard repayment period is 10 years, however alternate repayment options are available. All borrowers are required to pay an origination fee. A loan origination fee is also deducted from the face value of each loan borrowed. For more information on up-to-date loan interest rates and origination fees, visit the Federal Student Aid website's Interest Rates and Fees for Federal Student Loans page.

    Parents (biological or adoptive) or step-parents (currently married to the parent) of dependent matriculated students may borrow through this program. The student must be enrolled at least half-time (6 credits per semester) and must maintain Satisfactory Academic Progress. The parent/ step-parent must have a positive credit history. Both the parent/step-parent and the student must be U.S. citizens or eligible non-citizens. Neither the parent/step-parent nor the student may be in default of a federal student loan or owe a repayment on a federal grant. The student must have filed a Free Application for Federal Student Aid (FAFSA) for the parent to be eligible for a PLUS loan.

    If credit-approved, the parent must sign a Master Promissory Note (MPN) if not previously completed. The MPN can be signed online on the Federal Student Aid website. There is no ‘Need” requirement for this loan. The parent/step-parent may borrow up to the cost of attendance per student minus financial aid available to the student. Funds are disbursed twice during the loan period. However, PLUS loans cannot be used to replace the student’s eligibility for the Stafford Loan, so it is generally to the family’s advantage to have the student borrow the lower interest rate Stafford Loan. Parents must reapply each year if they want a PLUS loan.

    As with all student loans, Parent Loans for Undergraduate Students are to be used exclusively for educational expenses.

  • Full or part-time graduate students can borrow money equal to their cost of attendance minus other estimated financial assistance.

    Applicants must demonstrate that they do not have an adverse credit history. There is no limit to the amount of money a student can receive – students may borrow (up to the cost of attendance) minus any funds covered by existing financial aid.

    The first payment on a Direct PLUS Loan is due within 60 days after the loan is fully dispersed. Students may, however, postpone payments on the loan while they are in school. Fill out a FAFSA (Free Application for Federal Student Aid) to apply.

    More information about this loan can be found on the Direct PLUS Loans for Graduate Students website.

How to Apply for and Secure Your Federal Direct Loans

The US government offers various federal student loans for undergraduate students, graduate students, and parents of dependent students who file the Free Application for Federal Student Aid.

The Federal Direct PLUS Loan is a credit-based unsubsidized federal education loan for graduate students and eligible parents of dependent undergraduate students. Additional Federal Direct Loan Program information is available at the Federal Student Aid Website.

If you accepted a Direct Subsidized or Unsubsidized Loan you must complete the following steps:

  • You will need a unique Federal Student Aid ID (FSA ID). If you do not have one, create an account.
    • This is the same account used to electronically complete and sign the FAFSA.
  • Complete your Subsidized/Unsubsidized Master Promissory Note (MPN) for Students.
    • Master Promissory Notes (MPN) for the 2023-2024 academic year will be available in April 2023.
  • Complete your Loan Entrance Counseling on the Federal Student Loan website.

If you and your parent accepted and applied for a Direct Parent PLUS Loan your parent borrower must complete the following steps:

  • The parent borrower will need a unique Federal Student Aid ID (FSA ID). If you do not have one, create an account.
  • Complete the PLUS Master Promissory Note (MPN) for Parents.
    • Master Promissory Notes (MPN) for the 2023-2024 academic year will be available in April 2023.
  • Plus Loan Credit Counseling must be completed if the Department of Education determined the parent borrower has an adverse credit history and the borrower is originally credit-denied.

If you accepted and applied for a Direct Graduate PLUS Loan you must complete the following:

  • You will need a unique Federal Student Aid ID (FSA ID). If you do not have one, create an account.
    • This is the same account used to electronically complete and sign the FAFSA.
  • Complete your PLUS Master Promissory Note (MPN) for Students.
    • Master Promissory Notes (MPN) for the 2023-2024 academic year will be available in April 2023.
  • First-time Graduate PLUS loan borrowers must also complete Loan Entrance Counseling on the Federal Student Loan website.
  • Parent PLUS Loan Applications will now be completed and submitted using the PLUS Loan Application on the Federal Student Aid website.

    (A Pace University application is still required for the Spring and Summer of 2023 - see the above bullet.)

    The Federal Direct Parent PLUS loan is a credit-based, unsubsidized, federal education loan for eligible parents of dependent, undergraduate students. To ensure the Parent PLUS loan will be available for the start of the semester, the below steps must be completed a minimum of two (2) weeks before the bill due date.

    To apply for a PLUS loan beginning in Fall 2023, follow the steps below:

    1. You, the parent borrower, and your student must log into their MyPace Portal and accept the Parent PLUS Loan offer to confirm the amount you wish to borrow.
      • Plus Loan eligibility is determined by using the student’s Cost of Attendance minus other aid (total of gift aid and accepted student loans).
    2. Eligible parents/step-parents/adoptive parents of dependent, undergraduate students must complete the Federal Parent PLUS Loan Application and consent to obtain a credit report on the Federal Student Aid website.
      • You, the parent borrower, will need:
        • Your unique FSA ID.
        • Your and your student's social security number.
        • Decide if you are securing a loan for the entire Fall 2023/Spring 2024 academic year or for a specific Fall 2023 only or Spring 2024 only term.

    The Department of Education’s Common Origination and Disbursement Center (COD) will notify the parent via mail/email if they are credit approved or denied.

    • If the loan is credit-approved, the parent borrower must complete a PLUS Master Promissory Note (MPN) for Parents using their FSA ID.
      • The PLUS MPN for Parents for the 2023-2024 academic year will be available to complete beginning April 2023.
      • For assistance with completing this MPN please call (800) 557-7394.
    • If the loan is credit-denied:
      • The parent borrower may follow the directions included in the credit decision notification to seek an endorser or appeal the credit decision.
      • Or, the student may be eligible for an additional Direct Unsubsidized loan of $4,000 for students with 0-64 completed credits (Freshman/Sophomore), or $5,000 for students with 65+ credits completed (Junior/Senior).

    Should the parent borrower wish to make any changes to their approved Parent Plus loan (increase, decrease, cancel, etc.) they must complete a Loan Change Request form. Once an original Parent Plus loan application is credit-approved, you do not need to submit a new application.

    When applying for a Parent PLUS loan please consider:

    • If a parent borrower is applying for a PLUS loan to finance off-campus, non-Pace University housing, they must provide the Financial Aid Office with a copy of their completed, lease agreement, signed by all parties, with the student listed as a lessee, prior to submitting the loan application.
    • If you have borrowed a Federal Direct PLUS loan for the same student at a different school in the past, you may not need to sign a new Master Promissory Note (MPN).

    IMPORTANT INFORMATION REGARDING FEDERAL DIRECT PARENT LOANS (PLUS)

    • Your parent must be a US citizen or permanent resident to apply for this loan.
    • It is not guaranteed and is subject to credit approval.
    • The current interest rate on a Direct PLUS loan is 7.54%.
    • The amount of the loan disbursed will be reduced by the origination fee, which is currently 4.228%. Both rates are subject to change.
    • Payment on a Direct PLUS loan can be deferred until six months after the dependent student (for whom the loan is borrowed) graduates or falls below half-time (six credits) by contacting the servicer of the loan.
  • Graduate PLUS Loan Applications will now be completed and submitted using the PLUS Loan Application on the Federal Student Aid website.

    (A Pace University application is still required for the Spring and Summer of 2023 - see the above bullet.)

    The Federal Direct Graduate PLUS loan is a credit-based, unsubsidized, federal education loan for Graduate level students. To ensure the Graduate PLUS loan will be available for the start of the semester, the below steps must be completed a minimum of two (2) weeks before the bill due date.

    To apply for a PLUS loan beginning in Fall 2023, follow the steps below:

    1. Graduate students must complete the Federal Graduate PLUS Loan Application and consent to obtain a credit report on the Federal Student Aid website.
      • You, the borrower, will need:
        • Your unique FSA ID.
        • Your social security number.
        • Decide if you are securing a loan for the entire Fall 2023/Spring 2024 academic year or for a specific Fall 2023 only or Spring 2024 only term.
        • Plus Loan eligibility is determined by using the student’s Cost of Attendance minus other aid (total of gift aid and accepted student loans).

    The Department of Education’s Common Origination and Disbursement Center (COD) will notify you via email if you are credit approved or denied.

    • If the loan is credit-approved, you must complete a PLUS Master Promissory Note (MPN) for Students.
      • The PLUS MPN for Students for the 2023-2024 academic year will be available to complete beginning April 2023.
      • For assistance with completing this MPN please call (800) 557-7394.
    • If the loan is credit-denied:
      • You may follow the directions included in the credit decision notification to seek an endorser or appeal the credit decision.

    Should you wish to make any changes to your credit-approved Graduate Plus loan (increase, decrease, cancel, etc.) you must complete a Loan Change Request form. Once an original Graduate Plus loan application is credit-approved, you do not need to submit a new application.

    IMPORTANT INFORMATION REGARDING FEDERAL DIRECT GRADUATE LOANS (PLUS)

    • It is not guaranteed and is subject to credit approval.
    • The current interest rate on a Direct PLUS loan is 7.54%.
    • The amount of the loan disbursed will be reduced by the origination fee, which is currently 4.228%. Both rates are subject to change.
    • Payment on a Direct PLUS loan can be deferred until six months after you graduate or fall below continuous fall/spring half-time (six credit minimum) enrollment by contacting the servicer of the loan.