Loans

Federal Perkins Loan

Students qualify for these loans on the basis of financial need and according to the institution’s Packaging Policy. Eligible students may be assigned Perkins Loans up to $3,000 per year, with an aggregate limit of $15,000 as undergraduates.

For first-time borrowers, repayment of Perkins Loans begins nine months after termination of at least half-time enrollment at an eligible institution and continues over a period of 10 years (or less) with interest charges of 5 percent per year and a minimum monthly payment of $40.

Typical Repayment of Loans

IWU Student Loan

Awards in this institutional loan program range from $200 - $3,000 per academic year to students whose parent has been denied the Parent PLUS Loan and who demonstrate financial need. Repayment of principal and interest begins immediately after the first disbursement of the loan. Interest is charged at a fixed rate of 8.75% and accrues from the point of disbursement, even while the student is enrolled.

Typical Repayment of Loans

Due to the large number of loan accounts, the inherent complexities of the federal Perkins Loan program, and the new importance of loan repayments, Indiana Wesleyan University has contracted with University Accounting Service, Milwaukee, Wisconsin, to handle the billing and collection functions for all federal Perkins Loans and IWU Student Loans administered by the university.

Federal Direct Loan

Direct Loans are need-based and/or non-need-based loans for which a student applies through the Direct Loan Program. Repayment begins six months after the student ceases to be at least a half-time student and is typically spread over a period of up to 10 years. Deferments are available if the student meets certain conditions. Dependent freshmen may borrow up to $5,500 per academic year, sophomores may borrow up to $6,500, and juniors and seniors may borrow up to $7,500, based on financial need. The total amount of undergraduate loans may not exceed $31,000. All students must file the Free Application for Federal Student Aid to qualify for a Direct Loan.

Students with financial need may qualify for a 4.29 percent interest rate subsidized Direct Loan, which means the government is paying or subsidizing the interest while the student is in school. Students without financial need qualify for the unsubsidized Direct Loan at 4.29 percent interest, in which their interest is not paid by the government. Students may pay the interest monthly while in school, or the lender will capitalize the accrued interest each year causing the loan to increase more rapidly.

In order to help each student meet the August 15 payment expectation, the Financial Aid Office recommends that all applicable e-paperwork (Master Promissory Note, Federal Entrance Counseling and Federal Direct Loan Request) be completed and submitted prior to July 1 each year.

Typical Repayment of Unsubsidized Direct Loans

Federal PLUS (Parent Loan for Undergraduate Students)

Parents may borrow funds through this program to assist with their child(ren)’s educational expenses. The limit is the cost of education per child minus other financial aid. The interest rate is a fixed 6.84 percent. Borrowers must be creditworthy and can begin repayment upon disbursement of the funds or request a deferment until the student is no longer enrolled full-time.