Parents of dependent students may apply for the Parent Plus loan. To be eligible, the student must first have completed the FAFSA application at Amarillo College. Federal law requires the Department of Education to perform a credit check before approving a PLUS loan. A pre-approval from the Department of Education must be sent to the college before the PLUS loan will be originated by the Financial Aid Office.

Truth in Lending

All guaranteed student loans at Amarillo College will be processed through the Federal Direct Loan program. Under this program, all guaranteed student loans will be funded by the Department of Education.

The Department of Education establishes an annual maximum loan limit for Direct loans.
Currently the following maximum limits are:

Dependent Students: First Year - $5500 (no more than $3500 may be subsidized)
                                      Second year - $6500 (no more than $4500 may be subsidized) 

Independent Students: First year - $9500 (no more than $3500 may be subsidized)
                                          Second year - $10,500 (no more than $4500 may be subsidized)

For loan limit requirements, students with less than 30 credit hours completed toward their current active degree plan will be classified as first year. Students with 30 or more credit hours completed toward their current active degree plan will be classified as second year.

Students at AC may not be eligible to receive the maximum annual loan limit during the academic year. Students’ loan awards may not exceed the student’s cost of attendance minus any financial aid awarded minus other resources (for example, assistance received from the WIA program, DARS, or other outside resource such as scholarships).

The Department of Education also establishes an overall aggregate limit for Direct loan.
Currently the following maximum aggregate limits are:

Dependent: $31,000
Independent: $57,500

The Department of Education charges a 1.066% origination fee for all subsidized and unsubsidized Direct loans. Students who wish to apply for a Direct loan at AC must submit a loan request through AC Connect. Go to Current Student, Financial Aid, Financial Aid Checklist, and click the Financial Aid tab. You will see an option to 'Request a new loan'. Direct Loans will not be considered until all other aid has been determined.  Loans are awarded for the academic year. To qualify for Direct loan funds, students must complete the FAFSA process, be enrolled at least 6 degree required hours, be meeting the terms of the Satisfactory Academic Progress policy and not currently have a guaranteed student loan in default.  

In-School Information

Loan Disclosure Notice

You will receive a Loan Disclosure notice for each Direct Loan you borrow. The Loan Disclosure notice from your loan servicer contains information about interest rates, origination fees and loan repayment dates. The notice also includes the name, address, and phone number of your loan servicer. It is your responsibility to notify your loan servicer when you move, change your mailing address, email address, or phone number.

Entrance Counseling

If you have not previously received a Direct Loan or Federal Family Education Loan (FFEL), the Federal Government requires you to complete entrance counseling to ensure that you understand the responsibilities and obligations you are assuming. Entrance Counseling will be completed at https://studentaid.gov/fsa-id/sign-in/landing. You will need your FSA ID to log-in. During the counseling session, you will receive information on understanding your student loans, managing your spending, plans for repayment, avoiding default, and making your finances a priority. This counseling has been developed by the Department of Education to help you improve your money management skills.

In-School Deferment

Your loans remain on in-school deferment as long as you enroll in at least half-time hours; half-time enrollment status at AC is 6 credit hours. While on in-school deferment, you are not required to make payments on your loan. Your loan servicer will be notified of your enrollment after the census date of the semester. If you need to obtain Enrollment Verification, please log into AC Connect, look under the Self Service block, click on "Current Student", "Academic Profile" and "Enrollment Verification". After graduating or dropping below half-time enrollment status, your loan(s) will begin their grace period.

Exit Counseling Requirements

Students who have borrowed under the Direct Loan Program must complete Exit Counseling during their final semester when graduating or when withdrawing from classes. The U.S. Department of Education wants to insure that you review the terms of your loan and understand your rights and responsibilities under this program as you enter repayment. To complete the Exit Counseling requirements, go to https://studentaid.gov/fsa-id/sign-in/landing and select the loan exit counseling option from the Loan Repayment heading.

Rights

As a student loan borrower, you have rights.
These rights include:

• Knowing the interest rate you will be charged on your student loan(s).
• Knowing the date you must start repaying the loan(s) based on your anticipated graduation date reported to your loan servicer by the Registrar's Office.
• A complete list of any charges you must pay (originiation fees) and information on how these charges are collected.
• The ability to cancel your loan at any time prior to the disbursement of funds, or the ability to return all or part of your loan disbursement within 30 days of disbursement without penality.
• Having access to information on the types of loan repayment options.
• An explanation of what constitutes a student loan default and its consequences.

Grace Period/Loan Repayment

Each loan will have a 6 month grace period. During your grace period, you should receive additional correspondence from your loan servicer concerning the due date of your payments, and the payment amount that must be repaid each month. There is no penalty for repaying your loan early or for making larger payments than what is required. By paying early and often, you will save yourself money by paying less interest on the loan(s). Once the grace period has expired, your loan(s) will go into a repayment status. Depending on the number of loans you have borrowed, you may have more than one loan servicer. To complete a Financial Aid review of your loans and to obtain contact information for your servicers, go to www.nslds.ed.gov or https://studentaid.gov/fsa-id/sign-in/landing.

Repayment Plans

The Federal Direct Loan Program offers several repayment plans that are designed to meet the different needs of individual borrowers. These plans include:

Fixed Payment Repayment Plans

The fixed payment repayment plans include the Standard Repayment Plan, the Graduated Repayment Plan, and the Extended Repayment Plan. These plans base your monthly payment on how much you owe, your interest rate, and a fixed repayment time period.  If you want to be placed on one of these repayment plans, contact your loan servicer. You can find more information on these fixed payment options at https://studentaid.gov/manage-loans/repayment/plans/standard.

Income-Driven Repayment (IDR) Plans

These plans base your monthly payment amount on how much money you make and your family size. These plans include the Saving on Valuable Education (SAVE) Plan, Pay As You Earn (PAYE) Plan, Income-Based Repayment (IBR) Plan, and the Income-Contingent Repayment (ICR) Plan. For more information on the Income-Driven Repayment Plans visit https://studentaid.gov/manage-loans/repayment/plans.

Federal Student Loan Consolidation Programs

Students who have several student loans may want to consolidate their loans. This will enable the student to only have a single payment to make each month. Consolidation may result in a lower monthly payment. Consolidation may increase the total amount of interest you will be paying over the life of the consolidation loan, since the repayment period is generally extended. However, you may choose to make larger payments on the consolidation loan, which will reduce your overall interest charges. If you are interested in more information on loan consolidation, visit https://studentaid.gov/loan-consolidation/.

Deferment/Forbearance

If you are having problems making your loan payments due to unemployment, disability, military deployments, or other life-changing events, you should contact your loan servicer to inquire about deferment or forbearance options.

Deferments
A deferment is a postponement of payment on a loan, during which, interest does not accrue if the loan is subsidized.

You may qualify for a deferment while you are:

• Enrolled at least half-time in an eligible college or university
• Studying full time in a graduate fellowship program
• Enrolled in an approved disability rehabilitation program.
• Unemployed or meet our rules for economic hardship 
• Qualifying active duty service in the U.S. Armed Forces or National Guard. 

In most cases, you need to submit a deferment request to your loan servicer along with documentation of your eligibility for the deferment.

Forbearance

If you can't make your scheduled loan payments, but don't qualify for a deferment, your loan servicer may be able to give you a forbearance. A forbearance allows you to temporarily stop making payments on your loan, temporarily make smaller payments, or extend the time for making payments. Some common reasons for getting a forbearance are illness, financial hardship, or serving in a medical or dental internship or residency. You may need to submit a forbearance request to your loan servicer along with documentation of your eligibility for a forbearance.

You can find more information on forbearance and deferment options at https://studentaid.gov/manage-loans/lower-payments/get-temporary-relief.

If you are in default on your loan, you are not eligible for a deferment or forbearance.

Defaulting on your Student Loans

The consequences of default are severe.  Unless you are in an approved deferment or forbearance, failure to make payments on your student loan will result in default. The lender or agency that holds your loan, the state and/or the federal government will take legal action to recover the money you owe, including:

• Notifying national credit bureaus of your default. This may affect your credit rating for as long as seven years. For example, you might find it difficult to borrow money from a bank to buy a car;
• The Internal Revenue Service may withhold your income tax refund and apply it to the amount you owe;
• The agency holding your loan might ask your employer to withhold payments from your pay check (wage garnishment);
• You generally will be liable for late fees and loan collection costs on top of what you originally borrowed
• If you return to school, you generally will not be eligible for Federal student aid (including Federal Pell grants, state grants and student loans).PLUS loans

Amarillo College's current default rate for the most three-year cohort periods are indicated below and at https://studentaid.gov/data-center/student/default. For national default averages, visit https://studentaid.gov/data-center/student/default.

Student Loan Code of Conduct

1. Ban on Financial Ties

Lenders are prohibited from giving anything of value to any college in exchange for any advantage sought by the lender. This severs any inappropriate financial arrangements between lenders and schools and specifically prohibits revenue sharing arrangements.

2. Ban on Payments for Preferred Lender Status

Lenders may not pay or give colleges any financial benefits whatsoever to get on a colleges preferred lender list.

3. Gift and Trip Prohibition

Lenders are prohibited from giving college employees anything of more than nominal value. This includes a prohibition on trips for financial aid officers and other colleges officials paid for by lenders.

4. Advisory Board Rules

Lenders are prohibited from paying college employees anything of value for serving on the advisory boards of the lenders.

5. Call-Center and Staffing Prohibition

Lenders must ensure that employees of lenders never identify themselves to students as employees of the colleges. No employee of a lender may ever work in or provide staffing assistance for a college financial aid office.

6. Disclosure of Range of Rates and Defaults

Lenders must disclose to any requesting school the range of rates they charge to students at the school, the number of borrowers at each rate at the school, and the lenders historic default rate at the school. This will ensure that schools will have the information they need to select preferred lenders who are best for students and parents.

7. Loan Resale Disclosure

Lenders shall fully and prominently disclose to students and their parents any agreements they have to sell loans to any lender.