Loan FAQ’s

How is my eligibility for Direct Federal Loans determined?
Direct Federal Loans (Stafford and Perkins) require that a Free Application for Federal Student Aid (FAFSA) be completed every academic year. Once the Financial Aid Office receives your FAFSA from the government, we will determine your eligibility for different types of federal loans based on your year in school and financial need.

What must I do if offered loans in my financial aid award proposal?
Students who are offered loans must choose to accept or decline them as indicated on their award proposal. After accepting the award package, additional loan documents are required before we are able to process the loan(s). Loan documents (master promissory note and loan counseling guide) are completed online (paper forms available upon request only).

Do I need to complete a master promissory note every year?
You are required to complete a master promissory note every academic year for the Perkins Loan and Illinois Wesleyan Loan.  The Direct Stafford Loan master promissory notes are to be completed and signed the first year only. All loan forms are available online.

When do I have to start repaying my loan(s)?
Direct Federal Stafford Loans (Subsidized and Unsubsidized) repayment begins 6 months after the student leaves the university (graduates or withdraws) or drops below half-time enrollment (less than 2 units). The Federal Perkins Loan repayment begins 9 months after the student leaves the university (graduates or withdraws) or drops below half-time enrollment (less than 2 units). The Illinois Wesleyan Loan repayment begins 6 months after the student leaves the university (graduates or withdraws) or drops below half-time enrollment (less than 2 units).

Can I make payments on my Direct Federal Stafford Loan while I am still in college?
Yes. You can pay a portion (or all) of your Stafford Loan obligation with no prepayment penalties while you are still pursuing your education. Students may also elect to make interest only payments on unsubsidized loans to help further reduce their loan balance.

Can my parents apply for a loan to help finance my education?
Yes. Parents may apply for the Federal Direct Parent PLUS Loan. To apply, parents must go to the government’s website (www.studentloans.gov). The applying parent must complete a master promissory note during their credit application and the Federal PLUS Loan Request Form on the Financial Aid Section of the IWU website.

What are Private Loans?
Private Loans are funded by banks and private lending institutions. These are credit based and the terms will vary depending on the lender. Private loans requiring school certification by the Financial Aid Office can be processed for up to the student’s Cost of Attendance minus other aid received during their enrollment.