Direct Loan Program (Federal aid for students)
Direct Loans are low-interest loans for students and parents to help pay for the cost of a student's education after high school. The lender is the U.S. Department of Education rather than a bank or other financial institution.
With Direct Loans, you:
- Borrow directly from the federal government and have a single contact - the Direct Loans Servicing Center - for everything related to the repayment of your loans, even if you receive Direct Loans at different schools.
- Have online access to your Direct Loan account information 24 hours a day, 7 days a week at Direct Loans on the web.
- Can choose from several repayment plans that are designed to meet the needs of almost any borrower, and you can switch repayment plans if your needs change.
Comparison of Federal Loans
Various loan options exist. The Federal Direct Student Loans, PLUS and Grad PLUS are all federal loan programs. In addition, there are private (sometimes called “alternative”) loan options available to you. The federal loans often have the best interest rates, deferment options, and repayment plans. You should maximize your eligibility especially for the Direct Loan program prior to considering other loans.
Subsidized vs. Unsubsidized
During in-school periods (enrolled at least half-time) and in grace periods*, no interest accrues on Federal Subsidized Direct Loans. Repayment of principle on Unsubsidized Direct Loans also begins six months after the student graduates or ceases to be enrolled at least half time, but there is no interest subsidy (meaning the student is responsible for paying the interest that accrues during in-school and grace periods, as well as in repayment). Students can begin repayment even while still in school. Beginning repayment early may reduce some of the overall interest charged on a loan. Students should update all their demographic information as it changes to all of their lenders in order to receive important information regarding their loans
*Effective July 1, 2012 any new subsidized loan disbursed on or after July 1, 2012 and before July 1, 2014 will have interest accrued during grace period.
Parent PLUS Loans (Federal aid for parents of dependent students only)
The Direct Parent Loan for Undergraduate Students (PLUS) is available to credit-worthy parents of dependent, undergraduate students. PLUS loans are not subsidized and parents are responsible for all interest that accrues on the loan from the day it is disbursed until the loan is paid-in-full. Current interest rates are available in the information above. Proceeds are normally disbursed electronically to the school in multiple disbursements (usually one per semester). Parent borrowers begin repayment 30 days after the loan is fully disbursed, and standard repayment lasts ten years.
More information is available at the Federal Government web site. You can apply for a Direct Parent Loan at www.studentloans.gov.
Alternative Loans (other lending programs, not Federal aid)
Many alternative educational loans are available. These are consumer loans, not federal aid, and may have income requirements and credit checks.
Davenport has provided a list of possible lenders and these are not considered preferred lenders. This list represents lenders that Davenport University students have chosen to apply with for private educational student loans. Davenport does not and will not recommend a lender for private educational loans. The list is provided in alphabetical order and does not indicate that one lender is more preferred over another.
- 5/3 Educational Lending
- Charter One
- Discover Student Loans
- PNC Bank
- Sallie Mae
- Wells Fargo
We encourage student and parent borrowers to select a lender based upon their educational and financial needs. This list is provided to student and parent borrowers for informational purposes only. Student and parent borrowers may select any lender they wish which may or may not be included in this list.
- Davenport University encourages you to maximize your Federal Direct Loan eligibility prior to pursuing a private loan.
- Private loans should be viewed as supplemental to other financial aid.
- Private (i.e., Alternative) loans generally require a credit check and are not guaranteed by the Federal government.
- Thoroughly read through repayment guidelines, interest rate information, and other details before applying for a private loan.
- Loan Fees -- Most lenders do not charge loan origination fees. Be sure to check all fees and interest rates before applying.