Loan Information

Many students rely on federal government loans to help finance their education. These loans have low interest rates and do not require credit checks of collateral. Student loans also provide a variety of deferment options and extended repayment terms.

Whether you are a new or returning JWCC loan borrower, we strongly recommend that you take the time to read and understand all the loan information provided. Understanding all loan details and planning now will benefit you throughout college and beyond.

Student Loan Repayment Rights & Responsibilities

Your student loan is a debt you owe for your education and you should treat it 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 complete school, get a job, or feel you did not receive the educational or other services you purchased.

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 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 chosen lender establish for repaying your student loan have to meet certain federal guidelines.  These guidelines are outlined for you on the master promissory note when you first obtain 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 depending on the total principal amount & interest.
  • 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.

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 they will be due, and how long it will take to repay your loan in full.

You will have a grace period of no payments for six months which starts the day you drop below half-time status.

Student loans are not dischargeable through bankruptcy.

If you are unable to make monthly payments, contact your lender immediately to avoid default.  Alternative repayment options may be considered, as well as deferment or forbearance depending on your circumstances.

Once you drop below half-time status or anticipate graduating/transferring from JWCC, you are required to complete Exit Loan Counseling.  This will explain what to expect after “exiting” school including repayment options. You may complete Exit Counseling at the Direct Lending site:

Consequences of Default

  • Your credit rating and ability to borrow any loans will be seriously damaged.
  • You may lose future eligibility for financial aid and/or student loans.
  • You may be sued and court costs and legal fees will be added to what you owe.
  • Your Federal Income Tax refund may be withheld.
  • Your professional license renewal for certain occupations may be denied.
  • Your employer may withhold part of the salary for payment of your loan.
  • Your assets may be taken away from you.
  • Once a loan is declared in default, you are no longer entitled to any deferments or forbearances.

Frequently Asked Questions

Does it matter if you have received student loans in the past?

Yes. If you have student loans from more than one lender or from other federal student loan programs, you are responsible for informing the Financial Aid Office and your lender(s) about your other student loans. In some cases, you may not be eligible for loans for which you have applied.

What is the current interest rate?

Rates are subject to change July 1 of each year.

           As of July 1, 2022, the Direct Subsidized and Unsubsidized Loans are fixed at 4.99%.  Direct Parent PLUS Loans are fixed at 7.53%.

Are there fees associated with borrowing a Stafford Loan?

Fees are subject to change October 1 of each year.

As of October 1, 2020, the Direct Subsidized and Unsubsidized Loans have a 1.057% origination fee.  Direct Parent PLUS Loans have a 4.228% origination fee.

What is the school’s Cost of Attendance (COA)?

The COA is the estimated cost for you to attend JWCC.  Included in the COA are estimated costs for tuition, books, transportation, personal expenses, and room & board.  Your total financial aid award from all sources cannot exceed your COA.

What is the Expected Family Contribution (EFC)?

The EFC is determined by the information you submit on the Free Application for Federal Student Aid (FAFSA).  The EFC represents a reasonable figure a family is expected to invest in the student’s future, based on current income and assets.  It is not the amount you must pay the school.

What will happen to the existing loans that I have borrowed from other lenders?

Any previous loans you borrowed from another lender will be serviced by the lender/servicer you selected when you signed your original MPN. After graduation, you have a choice to make individual payments to your previous lender(s) and to the Department of Education for your Direct Loans, or you can consolidate your loans into one payment with the Department of Education.

Will the student loans I borrowed through my lender in prior years still be deferred?

As long as you are enrolled in school on at least a half-time basis, your prior year federal loans will continue to be deferred. Enrollment information is reported to lenders by the school on a regular basis.

What are the student loan repayment options?

There are several repayment options available for student loans:

    • Standard
    • Extended
    • Graduated
    • Income Contingent
    • Income-Based
    • Income-Sensitive
    • Pay as You Earn (PAYE)
    • Revised Pay As You Earn (REPAYE)

Please visit the Federal Student Aid website for more information as well as a repayment estimator!


What steps should I take to obtain a Parent PLUS loan?

Under the Federal Direct PLUS loan program, parents may borrow up to the full cost of their student’s education minus other financial aid received.  Credit checks are required.  However, the Direct Lending Program uses a more lenient credit assessment.

Application instructions are provided on our website to apply for a PLUS loan.

After you have completed an application for the PLUS loan, JWCC will submit your information to the Department of Education for a credit check.

How do I contact the Direct Loan Program?

The U.S. Department of Education Direct Loan Program Customer Service phone number is (800) 848.0979.

Direct Loan Program Website:

Student Loan Facts

  • Satisfactory academic progress must be maintained in order to receive the loan funds.
  • You are required to notify the Financial Aid Office of any changes to your schedule, whether adding or dropping classes. Schedule changes may impact your eligible loan amount.
  • All financial aid money received must be used for educational expenses related to your program of study at JWCC. Financial aid will be used first to pay tuition and fees at JWCC.
  • If you withdraw from classes after receiving Federal financial aid funds, you may be required to return all or a portion of the funds received. You may owe charges on your account not covered by the adjusted awards.
  • You must report in writing to the Financial Aid Office scholarships or grants received from sources other than John Wood Community College. (WIA, GAMM, DORS, Foundation Scholarships, etc.)
  • You may not receive financial aid from two schools at the same time.
  • All financial aid is awarded for one academic year only. You must reapply for financial aid each year.
  • Classes that begin late within a semester may delay disbursement of a loan.
  • Open Learning Center class start dates must be confirmed before financial aid may be disbursed.
  • Loan funds are delivered in two equal disbursements per semester.

After Loans are Processed

  •  You will receive an email notification once your loans have been processed.
  • Be sure to carefully read through ALL the information that is sent to you and keep it together for future reference.
  • If you do not understand some or all of the information, please contact us and we will do our best to explain the information.
  • Loan funds come directly to the school for further processing. Two disbursements are issued for each semester.
  • Problems and delays could always occur, so try not to plan your living expenses around your expected loans.
  • Once the school has received your loan funds, you will receive an email notification stating the loan has been officially applied to your account.

Exit Counseling

  • Student borrowers are required to complete exit counseling shortly before graduating or otherwise leaving school.
  • These online sessions explain the basic facts about subsidized and unsubsidized loans along with the student’s rights and responsibilities as a borrower.
  • This information will help you understand how to manage your student loan and the commitment that comes with the acceptance of a student loan.
  • You may start your exit loan counseling session by visiting the Direct Loan website.