What is a student loan?
A student loan is borrowed money that must be repaid with interest. Loans can be used by the student to supplement educational expenses that were not covered by institutional grants, or to assist students who are not eligible for grants. When a student is awarded a loan they are not required to accept it. Students also have an option of reducing the loans that they were offered. In order to be eligible for loans, the student must be enrolled at least half-time. Students will need to contact the financial aid office and lender if they graduate, withdraw, or drop below half-time. A six month grace period begins once the student falls into any of these categories before the first payment is required.
Direct Loans are low-interest loans that are lent to the student from the U.S. Department of Education rather than from a bank or other financial institution. As with other federal student aid, Direct Loans are applied for by filling out the FAFSA. Law students are awarded unsubsidized loans.
Direct Loan Program
The University of North Texas participates in the William D. Ford Federal Direct Loan program which allows you to borrow loan funds directly from the U.S. Department of Education. This program will give you and your parents a more stable, streamlined, and predictable borrowing experience. Read the FAQ's about the Direct Loan program.
- Direct Stafford Loan (Unsubsidized) – This loan is not based on need. Interest on this loan is charged during all periods, even during the time a student is in school and during grace and deferment periods.
- Direct Loan Grad (PLUS) – This is an unsubsidized loan for the student. Plus loans assist in the educational expenses up to the cost of attendance minus all other financial assistance that is awarded to the student. Interest on this loan is charged during all periods. Payments can be deferred for this loan.
- Private/Alternative Loan Information – Alternative or private loans are initiated by the borrower through a private lender. Interest rates on these loans can vary depending on the lender and the credit history of the borrower. Repayment terms can also vary depending on the lender. Once the credit is approved and the promissory note is received by the lender they will send a certification request to UNT Dallas. Alternative loan funds will be released to the students account only if all loan eligibility requirements are met at the time of disbursement. This loan cannot be consolidated with Direct Loans.
Evaluating the Option of Private Loan Financing
If you are considering borrowing through a private lender, we encourage you to:
- Be sure you have exhausted all other possible sources of financial aid.
- Consider all ways to reduce your expenses before you decide how much to borrow.
- Borrow only what you absolutely need.
Steps to Apply for Private Loans
It is the student’s choice to select: which private lender, amount of educational loan, and the type of educational loan from among those offered by the lender or lenders. The Office of Student Financial Aid & Scholarships will work with any lender you have selected in taking the steps such as certifying cost of attendance, processing, etc... University of North Texas at Dallas Student Financial Aid & Scholarships Code of Conduct.
Here are the basic steps entailed in applying for a private loan. Please note that this is general information. More specific information relating to your particular financial aid will appear through the myLaw portal at the appropriate time.
Step 1. Review the basic background on private loans.
Step 2. Review different lenders, keeping in mind important questions to ask.
After you have been admitted to College of Law:
Step 3. Choose a lender and complete the application to the lender.
Step 4. Go through and complete on-line loan counseling. (A link to this will appear in your myLaw student portal.)
Step 5. Review and accept/reduce/cancel the loan. (The information about your loan and the location for taking this step will appear in the myLaw portal.)
Required Documents Before the Direct Loan Will Disburse
Federal Regulations require that an entrance counseling and Master Promissory Note be completed for all first time borrowers. The entrance counseling is used to educate the student of the entire borrowing process and their repayment options. UNT Dallas requires all new borrowers to complete an entrance counseling if they are borrowing from UNT Dallas for the first time to ensure that they understand the rights and responsibilities that the student will incur when they accept their loan. This can be completed after the student has accepted their loan by visiting www.studentloans.gov. The online loan counseling session provides very useful information and guidance about private loans. The session covers: private loan basics, private versus federal loans, eligibility, choosing a lender and loan, repayment, and delinquency and default. If you apply for a private loan to attend the College of Law, you will be notified about how to complete the online loan counseling.
Federal Regulations also require borrowers to complete a Master Promissory Note (MPN). The MPN is a legal document in which the student promises to repay the loan and any interest or fees that have accrued on the loan. This document also explains the terms and conditions of the loan. An MPN is good for 10 years from the date that it was endorsed. The MPN can be completed at www.studentloans.gov approximately one day after the loan has been accepted.
Direct Loan Aggregate Limits
The federal government has an annual and lifetime limit on unsubsidized loans of $138,500. This is the maximum amount of unsubsidized loans a student can receive during their entire academic career. Graduate PLUS loans currently do not have a lifetime aggregate limit.