Private education loans are credit-based consumer loans that can be used to pay for any post-secondary education-related expenses, including tuition, fees, room, board and other related expenses such as books and transportation. Always consider your lowest-cost options first, including grants, scholarships, and federal student loans.
Private education loans are available to help families fill the gap to help pay for college. They should not be your primary funding source. Exhaust all of your other options, including Central's monthly, no interest payment plan, savings, summer work, work study and outside scholarships before you borrow any type of private loan.
Central recommends that students and families read questions to consider before selecting a private loan.
In an effort to provide better counseling services to our students, Central College has entered into a preferred lender arrangement (PLA). Federal and state law mandate that as a preferred lender, we provide the following disclosures:
To determine which lenders and loan options to present, Central College selected lenders who provide excellent customer service, interest rates, origination fees, borrower benefits, electronic application and processing. We also reviewed a historic list used by current and former students and lender reputation.
This list does not contain lenders affiliated with one another.
Students may borrow from any lender they choose and are not required to use a lender on Central's preferred lender list. Central College will process loans from any eligible lender you select.
Central has published a student loan code of conduct that must be followed.
Federal and state law mandates that we disclose the maximum amounts of Federal Grant and Loan assistance that are available. Maximum eligibility for federal financial aid is based on the results of the FAFSA and is outlined on the student's award letter. Federal financial aid has better terms and conditions than private student loans and we strongly encourage students to utilize that aid first. The following is a list of maximum awards in each program:
Pell Grant - $5,550
SEOG - 1,000 (award amounts are dependent on federal funding with a typical Central maximum award being $500)
TEACH Grant - $4,000
Stafford Loan - $5,500 (freshmen); $6,500 (sophomores); $7,500 (juniors and above)
Perkins Loan - $3,000 (the typical Central Perkins loan maximum is $1,000/year - award amounts are dependent on federal funding)
PLUS Loan - a credit-based loan for parent borrowers with a maximum determined by the difference between cost of attendance and the student's financial aid award.
Information on financing options available in the state of Iowa are available by clicking on State Scholarships and Grants.
When financing your education, a Stafford loan should be your first choice once you have already collected any scholarships and grants you may be eligible to receive. Stafford loans are fixed rate federal students loans guaranteed by the government. Subsidized Federal Direct loans have a fixed rate of 3.4% for the 2012-2013 academic year. Unsubsidized Federal Direct Loans have a fixed rate of 6.8%. The interest rate will be fixed for the life of the loan until repayment is complete. The loans can be used to pay for education-related expenses.
Stafford loan repayment plans are designed to provide flexibility for any budget. Once you complete school and enter repayment, you will have the option to pick from a number of helpful plans:
Standard Repayment - A fixed amount each month based on your principle and interest.
Graduate Repayment - Lower payments at the beginning of repayment, then over time, payments increase.
Income Based Repayment - Monthly payments are based on yearly income and loan amount.
Extended Repayment - For loans totaling more than $30,000, this plan offers a choice of fixed or graduated payments over a period of up to 25 years.
Central College has a limited resource of institutional loans. Please refer to your Central College catalog for additional information. You must complete one semester and meet the 2.0 GPA requirement to be eligible for an institutional loan.
The Financial Aid Office is utilizing FASTChoice, a loan comparison tool offered by Great Lakes Higher Education Corporation, which allows students to compare up to three different loans side-by-side. Enter FASTChoice now to view private loan products that are a part of our preferred lender list.
Once a borrower has been approved for a loan, it is very important to complete the necessary paperwork to continue the loan process:
Due to banking regulations, borrowers must complete a self certification form. Self-certification requires the following information:
Notify the Financial Aid Office of both the lender's name and the dollar amount being borrowed. The loan will be added to the student's record as a pending source of financial aid. It will also serve as a mechanism that will allow us to follow up with the lender if the funds are not received in a timely manner.
Lenders require you to actively accept the loan prior to disbursement. Your lender will communicate this process to you directly. Follow up with the lender if loan proceeds are not received. After a certain time frame determined by the lender, the loan will be canceled if it cannot be disbursed due to missing paperwork.
Preferred lender arrangements are reviewed annually to select lenders who provide the best services and loans for our students. Please provide feedback regarding your experiences when working with your particular lender. Feedback can be emailed to Donna Newendorp or call 641-628-5187.
