All Stafford Loans are financial aid.  They are either subsidized (the government pays the interest while you're in school) or unsubsidized (you pay all the interest, although you can have the payments deferred until after graduation). To receive a subsidized Stafford Loan, you must be able to demonstrate financial need.

With the unsubsidized Stafford loan, you can defer the payments until after graduation by capitalizing the interest. This adds the interest payments to the loan balance, increasing the size and cost of the loan. All students, regardless of need, are eligible for the unsubsidized Stafford Loan.

Stafford Loans allow dependent undergraduates to borrow up to $3,500 their freshman year and $4,500 their sophomore year. Students may not borrow more than a total of $12,000 for dependent students and $18,000 for independent students during their entire JWCC education.

Stafford Loans have variable interest rates (based on 91-day T-bill rate + 1.7% during school with an additional .6% increase upon graduation) capped at 8.25% or less, depending on yearly adjustments. All lenders offer the same rate for the Stafford Loan, although some give discounts for on-time and electronic payment. The current interest rate is 6.8%. However, this rate does change every July 1st.

1. Your financial aid file must be complete before we can process a loan (i.e. FAFSA, verification, appeal, etc).
2. Appeals for Satisfactory Academic Progress and Hour Limits must be received and processed.
3. All requested verification information must be received and reviewed.
4. You must be in a degree-seeking program that is financial aid eligible.
5. You must be enrolled in at least 6 credit hours that count towards your degree.
6. Complete Stafford entrance loan session at http://mapping-your-future.org/
7. Contact our financial aid office to set up a personal loan appointment.

Note: If you’ve received a loan at JWCC within the last 2 years, you will only need to fill out a loan renewal form which you can pick up in the enrollment services office.

Parents of dependent students can take out loans to supplement the student's aid packages. The federal Parent Loan for Undergraduate Students (PLUS) lets parents borrow money to cover any costs not already covered by the student's financial aid package, up to the full cost of attendance.  PLUS loans are the financial responsibility of the parents, not the student.

PLUS loans have variable interest rates (based on 52 week T-bill rate + 3.10%) capped at 9%. Repayment begins 60 days after the funds are fully disbursed, and the repayment term is up to 10 years. Some lenders offer a slight discount for automatic payment plans. The current interest rate is 8.5%, however this rate will change every July 1st.

You may borrow student loan funds from any participating lender.

Consider the following before determining your lender:

• Does the lender sell its loans to other lenders or secondary markets?
   
• Does the lender offer money saving incentives? A common offering is an interest rate reduction after a number of on-time payments.
   
• Does the lender capitalize interest, that is add it to the principal?
   
• Does the lender offer a toll-free telephone number to contact them and customer service when you need it?

The John Wood Community College lender list has been created to assist student borrowers and their families. The lenders that appear on this list were selected by our institution because of superior customer service. Each student has the right to select any lender of their choice regardless of the preferred lender list. We recommend that you choose your lender wisely.

Your student loan is a debt you owe for your education and you should treat your loan as you would any other kind of debt -- for example, a loan used to buy a car or a house. As with any debt, you are responsible for repaying your loan -- in full -- even if you did not (as sometimes happens) complete school, cannot get a job, or feel you did not receive the educational or other services you purchased.

If you are uncertain who your lender is, the National Student Clearinghouse. can provide information about the identity of your primary loan contact.

To repay your student loan successfully, you will need to manage your finances. If you plan for repayment now, you will reap big benefits in terms of future financial freedom and present peace of mind.

Start by getting organized. If you have not already assembled all of your loan documents in one place, do it now! Review these documents to make sure you understand all of your financial obligations.

Next, develop a budget. Begin by estimating both your starting salary and your living expenses. When figuring your expenses, do not forget to budget the monthly payment on your student loan.

The terms that you and your lender establish for repaying your student loan have to meet certain federal guidelines. These guidelines were outlined to you on the promissory note signed when you first obtained your loan. Here is a summary of those guidelines:

• Your payments are expected each month.
   
• The minimum monthly payment is $50, but can be higher if the amount of interest you owe on your loan is more than $50 each month.
   
• Your lender must give you at least five years to repay your loan, unless your minimum monthly payment pays off your loan before that time, or you request a shorter repayment period.
   
• You may prepay your loan at any time without penalty.
   
• Your loan obligation will be canceled if you become totally and permanently disabled or you die.
   
• You may be eligible for a graduated or income-sensitive repayment schedule on your loan, where you pay less in the beginning while you are getting established and pay more later as your earnings increase.
   
• Stay in touch with your lender. It is your responsibility to let your lender know if any of your personal circumstances change (i.e.. change of address, name, etc.).

Before your first payment is due, your lender will send you a repayment schedule telling you how much you owe, the amount of interest you will pay during your repayment period, what your monthly payments will be, when your payments will be due, and how long it will take to repay your loan in full.

You will have a grace period -- a time period after you graduate or leave school and before any payments are due on your loan. Your grace period is a transition period that allows you to prepare for the repayment of your loan. The length of the grace period typically lasts for six months after you graduate or leave school. It is important to note that the grace period may vary depending on the type of loan you received.

If you have any questions about repaying your student loan, contact your lender.

For student loans authorized under Section 435(i) Title IV of the Higher Education Act, default occurs on a student loan after a failure to make payments has persisted for 270 days in the case of a loan repayable in monthly installments or 330 days in the case of a loan repayable in less frequent installments. During the delinquency period, the lender must exercise "due diligence" in attempting to collect the loan; that is, the lender must make repeated efforts to locate and contact you about repayment. If the lender's efforts are unsuccessful, it will usually take steps to place the loan in default and turn the loan over to the guaranty agency in your state. Lenders may "accelerate" a defaulted loan, which means that the entire balance of the loan (principal and interest) becomes due in a single payment.

Once your loan is assigned to a guaranty agency or the U.S. Department of Education for collection, the following steps may be taken to recover the outstanding balance due:

• Credit bureaus may be notified, and your credit rating will suffer.
   
• The U.S. Treasury (IRS) may withhold your tax refunds as payments toward repayment of your loan.
   
• You may have to pay additional collection costs.
   
• Also, you may be subject to an administrative wage garnishment, whereby the Department will require your employer to forward 10% to 15% of your disposable pay toward repayment of your loan.
   
• Federal employees face the possibility of having 15% of their disposable pay offset by the Department toward repayment of their loan through the Federal Employee Salary Offset Program.
   
• Finally, the Department may take legal action to force you to repay the loan.

Once a loan is declared in default, you are no longer entitled to any deferments or forbearances. In addition, you may not receive any additional Title IV Federal student aid if you are in default on any Title IV student loan.