May 1, 2009

Important financial aid news for 2009-2010

The Office of Financial Aid has important information to share with the campus and the community. Beginning with the fall 2009 term, WSU will participate in a different loan program for students and parents. WSU recently researched and compared two student loan programs for our students, the Federal Family Educational Loan Program and the Federal Direct Student Loan Program. It became evident that the Direct Loan program was the better loan program for our students for a number of reasons.

1. FFELP funds are disbursed through private lenders (such as Bank of America, Commerce Bank, Sallie Mae, Wells Fargo etc.). The Direct Loan program is funded directly by the federal government, eliminating the middle man and the confusion.

2. There are more repayment plans through the Direct Loan program, specifically, the income contingent plan.

3. Direct Lending has the new Public Service Loan Forgiveness program that will forgive remaining debt after 10 years of eligible employment and qualifying loan payments for people working in key public service professions such as teaching, government, social work, law enforcement and nonprofit 501(c)(3) organizations.

4. The Direct Loan program is fully integrated with the federal financial aid process, streamlining the administration and oversight of the government funds. WSU already has the software and business processes in place to administer this program due to the other federal aid programs we administer.

5. Benefits advertised are part of your Master promissory note, unlike the benefits advertised with the FFEL program that are not apart of the FFEL promissory note. Borrowers are assured to receive Direct Loan borrower benefits as they are part of the signed promissory note.

6. Loans can be sold in FFEL, negating their borrow benefits. Loans are never sold in the Direct Loan program.

7. Direct Loans can be consolidated in the Direct Loan program, or in the FFEL program. There is still a choice in repayment options for WSU students.

We will begin the Direct Loan program in Fall 2009. When award letters are sent for the 2009-2010 academic year this spring, all new and returning student borrowers will have to sign new Master Promissory Notes and complete Direct Loan Entrance counseling. The new MPN can be completed at http://www.dlenote.ed.gov and entrance counseling can be completed at http://www.dl.ed.gov/borrowe/EntrCounselingStart.do.

Entrance Loan Counseling must be completed by all students even if one has been completed in the past. Effective July 1, 2008 all students receiving Graduate PLUS loans must also complete the PLUS Entrance Loan Counseling online session.

Please let us know if you have any questions regarding the Federal Direct Loan program. Contact the Office of Financial Aid at 978-3430 or finaid@wichita.edu