About Stafford Loans At LCCC

Federal Stafford Loan

LCCC participates in the Federal Family Education Loan Program (FFEL), which includes the Federal Subsidized Stafford Loan, Federal Unsubsidized Stafford Loan and the Parental Loan to Undergraduate Students (PLUS). Unlike grants, student loans are not free but are federally guaranteed loans that must be repaid. Repayment begins six months after the student graduates or stops going to school at least half-time (6 credit hours or more). The typical expense period for student loans is the first day of fall semester and the last day of spring semester (August through May). However, student loans may be processed for eligible semesters of enrollment of less than a full academic year including summer or on a borrower based academic year. Pre-loan counseling is conducted for all student loan applicants.

Subsidized Stafford Loan
Subsidized means that interest (which accrues on a loan while a borrower is in school, grace, or authorized periods of deferment), is paid by the government. Students do not have to make principal or interest payments while enrolled in an eligible academic program for at least half time (six credit hours).

Unsubsidized Stafford Loan
Unsubsidized means that the borrower is fully responsible for paying the interest that accrues on the loan. Interest on an unsubsidized loan accrues from the date of disbursement and continues throughout the life of the loan. Students do not have to make principal payments but ARE responsible for accrued interest while enrolled in an eligible academic program for at least half-time (six credit hours). Interest payments may be deferred until the student is in repayment.

Interest Rates
The interest rate for subsidized Stafford loans first disbursed on or after July 1, 2008 is fixed at 6.0 percent. For all unsubsidized Stafford loans first disbursed on or after July 1, 2006, the interest rate is fixed at 6.8 percent. This change from a variable to a fixed interest rate does not affect a borrower's variable interest rate on loans made before July 1, 2006.

Interest rates for Stafford loans are capped by federal law at 8.5%.

Loan Limits
Review the chart below for annual and aggregate limits for the Federal Stafford Loan.

* Loan eligibility is based on the federal loan calculation.

Loan Fees
Certain loan fees may be deducted from your loan.  Up to a 1% origination fee and a 1% default fee may be deducted from each disbursement of your loan, with a maximum of 2% total fees.

Origination Fee –Federal law requires the lender to collect an origination fee, effective July 1, 2008 of up to 1 percent to be paid to the federal government. This fee offsets the government’s costs of administering the student-loan program. Neither lenders nor guarantors receive any benefit from origination fees. 

Default Fee - Federal law requires that student-loan guarantors collect and deposit into their federal reserve funds a federal default fee.  The federal default fee is used by the guarantor of a loan to maintain reserve funds to reimburse lenders in the event a student- or parent-borrower defaults (fails to repay a loan).

How to Apply for a Student Loan
To apply for student loans, your first step is to complete the Free Application for Federal Student Aid (FAFSA) and comply with any request(s) for additional information. Next, complete the online Entrance Loan Counseling via the Internet and follow the instructions to select a lender and complete the process.

Click here for application instructions

Choosing a Federal Stafford Loan Lender
Funds for Federal Stafford Loans are provided by private lending agencies. LCCC has identified recommended lenders; we encourage you to review the borrower benefits with the lender before selecting your lender of choice. Students have the right to select any lender who participates in the Stafford loan program. If the lender you wish to choose is not listed, please select the "Other" option when attempting to complete your MPN (Master Promissory Note). You will need to enter the six digit lender code when prompted.

Lorain County Community College's Preferred Lender List
LCCC’s recommended lender list has been developed to help students and their families choose a loan provider.  Below, we have listed several factors that have been reviewed when creating our list:

• Reputable company that is financially sound and has longevity in the student loan industry
• Savings to students on the total cost of their borrowing
• Excellent level of customer service provided to LCCC’s borrowers in previous years
• Wide variety of services and products available to borrowers

Please note LCCC's Preferred Lender List is only a suggestion of potential loan providers.  LCCC receives no compensation, income or in kind support from these lenders in return for being placed on our Preferred Lenders List.   Students and families are highly encouraged to select a lender that best suits their individual needs regardless of whether or not that lender appears on LCCC’s Preferred Lender List.

Please note: if your lender of choice is not listed, please contact the Financial Services Center for information on how to process your loan request. LCCC is committed to processing all loan requests for the student’s lender of choice.

Loans will be awarded based on your maximum eligibility. If a student would like to borrow less than the maximum amount, please contact the Financial Services Center.

Additional eligibility requirements for Federal Stafford Loan borrowers are:

• Must be enrolled for a minimum of six credit hours for each semester you wish to borrow funds
• Must possess a minimum 2.0 LCCC cumulative grade point average to receive your loan funds
• Must be meeting the College’s satisfactory academic progress standards
• Must be meeting all other U.S. Department of Education eligibility requirements 
• At the time of disbursement, must be enrolled in and commenced attendance in a minimum of 6 credit hours.