WHAT TITLE IV FINANCIAL AID PROGRAMS ARE AVAILABLE?
Students interested in applying for financial aid to assist them with tuition and school related expenses, need to file the Free Application for Federal Student Aid (FAFSA) at www.fafsa.ed.govthen contact the Financial Aid Office at 740-289-5869 for an appointment to review eligibility.
Note: Financial Aid is not automatic, STUDENTS MUST FILE THE FAFSA IN ORDER TO RECEIVE TITLE IV AID
FINANCIAL AID OFFICE CONTACT INFORMATION
Financial Aid Office: (618)-939-0322
Pat McDonald, Financial Aid Administrator
Office Hours: Wednesday after 5pm
(best reached by e-mail)
Federal Pell Grant Program
Students wishing to apply for financial aid may visit the Financial Aid Office at the school where students are encouraged to apply for the Federal Pell Grant Program. The Pell Grant is a Federal grant given with no repayment expected. This program is designed to provide a “floor”upon which other financial aid programs are built. Any student wishing to receive a Federal Pell Grant, as well as, Federal Direct Loan must meet the eligibility requirements established by the U.S. Department of Education. To be considered for a Federal Pell Grant a student must complete the Free Application for Federal Student Aid(FAFSA). The FAFSA may be completed on-line at www.fafsa.ed.gov or a paper application may be used. FAFSA forms are available in the Financial Aid Office or other public places such as a library. Not all students will qualify for a Federal Pell Grant.
An Award Notification letter will be provided to the student indicating the type and the amount of aid awarded.
Federal Loan Programs
William D Ford Federal Direct Loan Program
Subsidized Loan – A subsidized loan is awarded on the basis of need. A student may be eligible to request a maximum of $3,500 per year for the first year of undergraduate study. Programs of less than 900 clock hours will be prorated down based on the number of hours in the student’s program. The federal government pays the interest during authorized periods of deferment. Repayment will begin six months after the borrower ceases to be enrolled at least half-time.
Unsubsidized Loan – An unsubsidized loan is not awarded on the basis of need, and the student is responsible for paying the interest during in-school, deferment, grace, and repayment periods. The unsubsidized loan is the difference between the cost of attendance and other aid (including subsidized loan) not to exceed $5,500 for a dependent student and $9,500 ($3,500 Sub & $6,000 Unsub) for a first year independent student. Repayment will begin six months after the borrower ceases to be enrolled at least half-time.
Federal Parent Loan to Undergraduate Student (PLUS) -PLUS loans are meant to provide additional funds to dependent students for education related expenses. Parents may borrow up to the cost of education, minus other aid received by the student. Repayment begins approximately sixty days after final loan disbursement is made.
To receive a Federal Loan, a student must complete the FAFSA and loan application (Master Promissory Note). If the student is dependent, and the parentis borrowing loan funds on behalf of the student, the parent must also complete entrance counseling and the Master Promissory Note on-line at www.studentloans.gov. Some of the information a borrower must provide are his or her name, address, date of birth, Social Security Number, and driver’s license number, e-mail address, as well as next of kin and two personal references. The loan application is the promissory note in which the student or borrower must read and sign 2) It takes about 20-30 minutes for the student to complete the entrance counseling quiz. The FA Officer instructs the student to take the quiz on their own.
All Federal loans will be reported to the U.S. Department of Education’s National Student Loan Data System as part of the student’s financial aid history. This information will be accessible to authorized agencies, other post-secondary institutions, lenders and Federal loan servicing agencies.
ENTRANCE AND EXIT LOAN COUNSELING SESSIONS
Recipients of the subsidized and the unsubsidized Family Federal Education Loans must attend entrance and exit loan counseling. Information provided to students includes but is not limited to:
- Entrance Interview
- Exit Interview
- Overview of all sources of aid.
- Financial planning for loan repayment
- Terms/conditions of various loan programs.
- Loan repayment obligations
- Loan application process
- Repayment options
- Repayment obligation
- Deferment/Forbearance/Cancelation provision
- Obligation to keep lender informed
- Obligation to keep lender informed
- Obligation to maintain satisfactory progress
- Consequences of delinquency/default
- Personal financial planning
- Name and address of lender
- Importance of keeping loan documents
- Estimated monthly payment information
- Borrower’s rights and responsibilities
- Consequences of delinquency/default
SAMPLE MONTHLY LOAN PAYMENT CHART
The chart below gives estimated payment amounts for Stafford and Plus Loans. It is based on immediate repayment and a maximum repayment period of ten (10) years. Numbers are approximate due to rounding.
||Number of Payments
||5.00% Mo. Pymt.
||6.00% Mo. Pymt.
||7.00% Mo. Pymt.
||8.25% Mo. Pymt
||9.00% Mo. Pymt
Federal Loan Repayment Plans
- Standard Repayment Plans Under this plan, you will pay a fixed amount of at least $50 each month for up to 10 years. This plan results in the lowest total interest paid of any repayment plan. If you have not selected a repayment plan by the time repayment begins, your loan(s) will be placed on the Standard Repayment Plan.
- Graduated Repayment Plan Under this plan, you will pay a minimum payment amount at least equal to the amount of interest accrued monthly for up to 10 years. Your payments will start out low, and then increase every two years. Generally, the amount you will repay over the term of your of your loan will be higher under the Graduated Repayment Plan than under the Standard Repayment Plan. This plan may be beneficial if your income is low now but is likely to steadily increase.
- Income Contingent Repayment (ICR) Plan ICR is a repayment plan that bases your monthly payment on your annual adjusted gross income (AGI), family size and total Direct Loan amount. As your income increases or decreases, so do your payments. After 25 years, any remaining balance on the loan will be forgiven, but you may have to pay taxes on the amount forgiven.
- Income Based Repayment (IBR) Plan Income-Based Repayment (IBR) plan bases your monthly payment on your yearly income and you must have a partial financial hardship to enroll. This plan is an alternative to the Income Contingent Repayment (ICR) Plan and is designed to make repaying education loans easier for students who intend to pursue jobs with lower salaries, such as careers in public service. It does this by capping the monthly payments at a percentage of your discretionary income. Like ICR, after 25 years of qualifying repayment, any remaining balance on the loan will be forgiven, but you may have to pay taxes on the amount forgiven
Extended Repayment Plans
- Fixed Monthly Payment Option Under this plan, you will pay a fixed amount of at least $50 each month for up to 25 years. To be eligible for this plan, your Direct Loan balance must be greater than $30,000. Repayment under this plan will result in lower total interest paid when compared to graduated plans with similar terms.
- Graduated Monthly Payment Option Under this plan, you will pay a minimum amount of at least $50 or the amount of interest accrued monthly, whichever is greater, for up to 25 years. Your payments start out low and then increase every two years. To be eligible for this plan, your Direct Loan balance must be greater than $30,000. Repayment under this plan may provide lower initial monthly payments, although the total interest paid may be greater when compared to plans with similar terms with fixed payments. This plan may be beneficial if your income is low now but is likely to steadily increase.
Pay as You Earn
Borrower pays the lesser of 10% of discretionary income (income –based payments) or what they would have paid under the standard repayment plan (non-income based). Currently for Direct Loan program only and for new borrowers and 2008 borrowers who received loans in FY 2012.
Additional, more specific information about loan repayment will be available from Direct Loan Servicing prior to you entering repayment.
Deferment and Forbearance
- Deferments A deferment is a postponement of payment on a loan, during which interest does not accrue if the loan is subsidized. You may qualify for a deferment while you are:
- Enrolled at least half-time in an eligible post secondary school or studying full time in a graduate fellowship program or an approved disability rehabilitation program.
- Unemployed or meet our rules for economic hardship (limited to 3 years).
- You may also be eligible for a deferment based on qualifying active duty service in the U.S. Armed Forces or National Guard. Refer to the MPN for your loan or contactyour service for more information about the specific qualifications fordeferment based on military service. In most cases, you need to submit adeferment request to your loan servicer along with documentation of you religibility for the deferment. If you’vegone back to school and your loan servicer receives enrollment information thatshows you’re enrolled at least half-time, it will automatically put your loansinto deferment and notify you. You have the option of cancelling the deferment and continuing to make payments on your loan.
- If you are in default on your loan, you are not eligiblefor a deferment or forbearance.
- Forbearance If you can’t make your scheduled loan payments, but don’t qualify for a deferment, we may be able to give you forbearance. Forbearance allows you to temporarily stop making payments on your loan, temporarily make smaller payments, or extend the time for making payments. Some common reasons for getting forbearanceare illness, financial hardship, or serving in a medical or dental internshipor residency. See your copy of theBorrower’s Rights and Responsibilities Statement for more examples. You can also get more information by contacting your loan servicer.Under certain circumstances, we can automatically give you forbearance, for instance, while we’re processing a deferment, forbearance,cancellation, a change in repayment plan or consolidation, or if you’reinvolved in a military mobilization or a local or national emergency.
- School-related discharges In certain cases, you may be able to have allor a part of your loan cancelled because:
- Your school closed before you completed yourprogram.
- Your school forged your signature on yourpromissory note or falsely certified that you were eligible to get the loan.
- Your loan was falsely certified because ofidentity theft (additional requirements apply).
- You withdrew from school but the school didn’tpay a refund that it owed under its written policy or our regulations. Check with the school to see how refundpolicies apply to federal aid at the school.
In general, you must repay your loan even if you don’t graduate, can’t find work in your field of study, or are dissatisfied with the education program.
Disability, Bankruptcy, or Death
Your loan may be discharged if you are determined to betotally and permanently disabled and you meet certain requirements during a 3-year conditional discharge period. To apply for this discharge, you must provide a physician’s statement that youbecame totally and permanently disabled after the loan was made. See your copy of the Borrower’s Rights and Responsibilities Statement for more information on the procedures and conditionsfor this discharge.
Your loan may be cancelled if it is discharged in bankruptcy. This is not an automatic process—you must prove to the bankruptcy court that repaying the loan would cause undue hardship.
For a student that dies, the loan will be cancelled if a family member or other representative provides acceptable documentation to the student’s servicer.
Contact your servicer for more information or to get a cancellation form. You can also findmore information in your copy of the Borrower’s Rights and Responsibilities Statement.
There may be advantages to consolidating (combining) your federal student loans into one loan, starting with the convenience of making a single monthly payment. Consolidation generally extends the repayment period, resulting in a lower monthly payment. This may make it easier for you to repay your loans. However you will pay more interest if you extend your repayment period through consolidation since you will be making payments for a longer period of time. Contact the Direct Loan Consolidation Centerfor more information at: 1-800-557-7395, TTY for the hearing-impaired at: 1-800-557-7395. The Direct Loans Consolidation website also has an online calculator that you can use tofind out how much you’ll pay each month if you consolidate.
If you want additional information on loan default, visit the Department’s Debt Resolution website.
The Creative TouchCosmetology School does accept some scholarships as tuition and feespayment. The student must submit theproper paperwork to the financial aid office, such as the name of contactperson, agency, copy of proof of scholarship etc. so the financial aid officewill know who to contact and where to collect the scholarship funds from. Note:The student will be responsible to pay for any tuition and other school relatedexpenses not paid by the scholarship.
The Creative Touch Cosmetology School does accept payment of tuition and fees from a student’s employer. The student must notify the Financial Aidoffice of the contact person, place of employment, etc. to invoice forpayment. Note: The student will be responsible to pay for any tuition and other school related expenses not paid by the employer.