GCC 2018-19 Catalog - Page 36

rates and are available to all students regardless of financial need
(although the FAFSA still must be filed). The interest rate is 4.45
and begins accruing as soon as the loan is disbursed to GCC. A
credit check is not required to receive these loans. The student is
responsible for the interest, which may be paid while the student
is in school or accrued and then added to the principal balance
when the student enters repayment, which occurs six months after
the student is no longer enrolled in school at least half-time.
Families of all income levels are eligible. A student may also
qualify for a combination of the two loans up to the maximum
loan amounts.
The maximum amount a student can borrow each school year
depends on grade level and a number of other factors. The base
amount cannot exceed $3,500 for first year dependent
undergraduate students and $4,500 for second year dependent
undergraduate students. There is an additional $2,000 available in
the Federal Direct Unsubsidized Loan for each of these grade
levels if the student is eligible for the increased amounts.
Independent undergraduate students need to discuss any increased
loan amounts with the GCC Financial Aid Director. First year
students are defined as students who have earned up to 27 credit
hours, inclusively. After a student has earned 27 credit hours, they
are considered second year students. No student at GCC is
considered above second year standing. Students are not required
to apply for the full maximum each year. In fact, students are
advised to apply for a minimal amount based on actual
educational needs.
Federal student loans can be used to pay eligible school costs such
as tuition and fees, room and board, books, supplies
miscellaneous and transportation expenses. The cost of
attendance for these items is determined by the school and all
student loan requests are reviewed on an individual basis. A
student may receive less than the maximum loan amounts for the
following reasons: the student is receiving other types of financial
aid used to cover the cost of attendance, the student does not have
some of the expenses listed in the cost of attendance, other
resources are being used to pay for the cost of attendance
components, the student requests loan money to pay for ineligible
costs, the student loan request exceeds allowable costs, etc. GCC
can refuse to certify a loan or can certify a loan for an amount less
than the student would otherwise be eligible as long as the refusal
is documented and it is explained to the student in writing. GCC’s
decision is final and cannot be appealed to the U.S. Department
of Education.
Students who have an outstanding debt of more than $20,000
(includes past loan history at other institutions) in federal student
loans may be required to submit an academic plan outlining their
courses by semester, anticipated graduation date, educational
needs and future loan borrowing. The academic plan must be
approved by the Director of Financial Aid before any loan funds
will be granted.
All students receiving loan funds are required to participate in
both entrance and exit counseling. Entrance counseling takes
place prior to the first disbursement of the loan and exit
counseling is conducted prior to or at the time the student
borrower ceases enrollment. Student loan counseling discusses
information regarding the responsibilities of indebtedness,
repayment options and consequences should the student fail to
repay the loan. Student loan counseling is an online process with
the U.S. Department of Education at studentloans.gov. Exit
counseling packets are mailed to all students with instructions on the
exit counseling process. The deadline date for processing loans for
the first semester is November 15 and April 15 for the second
Student loans, unlike grants and work-study, are borrowed money
that must be repaid, with interest, just like car loans and home
mortgages. Students cannot have these loans canceled because they
didn’t like the education they received, did not find a job in their field
of study or because the student is experiencing financial problems.
Loans are legal obligations, so before a student decides to take out a
loan, the student needs to think about the amount they will need to
repay over the years. The recipient of a student loan must recognize a
loan is a debt incurred by the student, not the parents. The
responsibility for understanding the conditions and regulations of the
loan process, as well as the repayment schedules, rests with the
student borrower. Students can find out more about student loans at
There is a limit on the maximum period of time (measured in
academic years) a student can receive Direct Subsidized loans. In
general, a student may not receive Direct Subsidized loans for more
than 150% of the published length of their program. This is called the
“maximum eligibility period”. The student can find the published
length of any program in GCC’s school catalog.
For example, if a student is enrolled in a 4-year bachelor’s degree
program, the maximum period for which they can receive Direct
Subsidized loans is 6 years (150% of 4 years = 6 years). If the
student is enrolled in a 2-year associate degree program, the
maximum period for which they can receive Direct Subsidized loans
is 3 years (150% of 2 years = 3 years).
The maximum eligibility period is based on the published length of
the student’s current program. This means the maximum eligibility
period can change if the student changes programs. Also, if the
student receives Direct Subsidized loans for one program and then
change to another program, the Direct Subsidized loans they received
for the earlier program will generally count against the new maximum
eligibility period. The student may also lose their subsidized
eligibility on the first loan when changing programs or if the student
does not complete their program in the 150% timeframe.
All students must fill out the FAFSA to determine loan eligibility as
well as submit a Master Promissory Note (MPN), a Federal Direct
Student Loan Request Form and participate in an entrance
counselling interview. Loan application materials can be obtained
from the GCC Financial Aid Office as well as online.
Federal Direct PLUS Loan for Parents
Federal Direct PLUS loans are loans parents can obtain to help pay
the cost of education for their dependent undergraduate children.
Parents with good credit histories are able to borrow up to the cost of
education minus the financial aid the student is receiving. The interest
rate is 7.0% and begins to accrue as soon as the loan is disbursed to
GCC with repayment beginning within 60 days unless a deferment
has been requested.
In order to qualify for a Federal Direct PLUS Loan, a person must: be
the biological or adoptive parent (or, in some cases, the stepparent) of
the student for whom the parent is borrowing; the parent of a
dependent student (FAFSA defined) who is enrolled at least halftime; not have an adverse credit history (a credit check will be done);


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