If you are borrowing a Direct Loan, you may be awarded a subsidized or unsubsidized loan depending on your financial need.

More Information on Subsidized and Unsubsidized Loans (StudentAid.gov)

Types of Direct Loans

Type	Basis of Award	Interest	Explanation
Subsidized	Student has financial need.	Interest will not accrue on your loan while you are enrolled at least half-time	If you are a first-time borrower on or after July 1, 2013, you may not receive Direct Subsidized Loans for more than 150% of the published length of your program. More Information on maximum eligibility period for Direct Subsidized Loans (StudentAid.gov)
Unsubsidized	Student does not have financial need.	You will be responsible for the interest while in school	Unsubsidized loan borrowers will receive quarterly interest statements on your unsubsidized loan from your lender. It is recommended that you pay this interest every quarter. If you do not, the interest will be added to your loan amount, which will result in your paying interest upon interest.

A student has control over the dollar amount they actually accept. However, there is a maximum limit that can be borrowed.

In many cases a student’s Pell Grant will cover the tuition and fees for the college. Though self-help aid such as federal loans is included in the award package, the student should carefully construct a financial plan that fits the student’s comfort level for accumulating debt. The student is free to accept, reduce or decline the aid based on personal preference or need. Additionally, students have 14 days after the disbursement of the federal loan to rescind and return the funds to the program.

Lamar State College Port Arthur encourages students to accept only what they need for school.

For additional information on Direct Loans please visit StudentAid.gov

If you are a first-time borrower on or after July 1, 2013, you may not receive Direct Subsidized Loans for more than 150 percent of the published length of your program. This time limit does not apply to Direct Unsubsidized Loans.

More Information on maximum eligibility period for Direct Subsidized Loans (StudentAid.gov)

Interest rates can change from year to year. The current interest rates are posted on StudentAid.gov.

Interest may accumulate interest while the student is attending school. Interest is a loan expense charged for the use of borrowed money. You will work with your loan servicer to choose a federal student loan repayment plan that’s best for you. Under certain conditions you may be eligible to have all or part of your loan discharged or forgiven (cancelled).

Yes, there is a loan fee on all Direct Subsidized Loans and Direct Unsubsidized Loans. The loan fee is a percentage of the loan amount and is proportionately deducted from each loan disbursement. The percentage varies depending on when the loan is first disbursed.

The Free Application for Federal Student AID is the application for the Federal Direct Subsidized and Unsubsidized Loans. You will be awarded Federal Loans based on the information supplied on the FAFSA, your classification, eligibility, annual and aggregate loan limits.

Prior to receiving the loans you will be required to complete 3 steps and enroll in at least a half-time course load (6 hours for undergraduates).

1. Accept / Decline your Loan Offer

Eligible students will receive a loan offer with their aid package. You must accept this loan offer through your My.LamarPA portal. You do not have to accept the full amount of your offered loan. You can lower your loan amount at your own choice. You cannot raise your loan amount.

View Directions to Accept Loans

2. Entrance Loan Counseling

Before you are allowed to borrow from the federal student loan programs, you must receive educational information concerning your rights and responsibilities. The entrance loan counseling session is designed to provide students with this information. This is a federal requirement that cannot be waived. Want more information?

Try this resource – Entrance Counseling Guide for Direct Loan Borrowers

3. Master Promissory Note

The Master Promissory Note is a binding agreement between you and the federal government agreeing to the terms of the loan. Available after July 1 or each year.

All loans are applied in two disbursements. Usually one disbursement at the beginning of Fall and the other at the beginning of Spring. Loans begin being applied to a student’s Lamar Port Arthur account 7 days before the first day of class.

Exceptions:

• If you are first time borrower your funds for the loan will not be applied until 30 days after the first day of class. You may be asked to confirm that you are attending your classes.
• If you will only attend LSCPA for one semester during the aid year. All loans are applied in two disbursements. The first half will be applied at the beginning of the semester. The second half will be disbursed at the 50% point of each semester. If you drop below half time before the 50% point, the second disbursement will not be disbursed.

Borrowers are encouraged to keep track of the total amount they have borrowed. You can find this information on StudentAid.gov, as well as a repayment calculator.

While you are still in school, you will also receive a Student Loan Debt Letter via e-mail from Inceptia on behalf of Lamar State College Port Arthur detailing your loans and giving you an estimated monthly payment.

A deferment is a period during which repayment of the principal and interest of your loan is temporarily delayed. There are several deferment options available to students who may need to suspend their payments for a short period of time. Most deferments are not automatic, and you will likely need to submit a request to your loan servicer, the organization that handles your loan account.

If you are enrolled in school at least half-time and you would like to request an in-school deferment, you’ll need to contact your loan servicer and submit the In-School Deferment Request through the National Student Clearinghouse.

You must begin repayment of your student loan, once you:

• Withdraw from school
• Drop below half-time status (fewer than 6 hours during a long semester)
• Graduate

1. Complete Exit Counseling

If you are a Direct Loan borrower at Lamar Sate College Port Arthur, you are required to complete exit counseling prior to leaving (graduate, transfer, withdraw or no longer attending). To complete your exit counseling, visit StudentAid.gov

2. Grace Period

Your grace period is a set period of time after you graduate, leave school, or drop below half-time enrollment before you must begin repayment on your loan. The grace period gives you time to get financially settled and to select your repayment plan. Not all federal student loans have a grace period. Note that for most loans, interest will accrue during your grace period.

3. Choose the right repayment plan

If you are having problems with making your payment it is very important that you contact the Direct Loan representative immediately. They are there to help you find a way to make your payments. There are multiple options to lower your payments.

4. Avoid Default:

Failure to make a payment on time, you're considered delinquent on your Direct Loan. If you do not make payments for 270 days, you are considered to be in default. Default has severe and long-lasting consequences.

Want more information? Try this resource – Repaying Your Loans

You’re not alone when it comes to student loans. LSCPA has partnered with Inceptia, a division of National Student Loan Program (NSLP), to provide you with FREE assistance on your Federal student loan obligations to ensure successful, and comfortable, loan repayment. Inceptia’s friendly customer representatives may reach out to you during your grace period to answer questions you have about your loan obligation and/or repayment options.

Inceptia is not a collection agency. We’ve partnered with them to inform you of a wide variety of possibilities such as alternative repayment plans, deferment, consolidation, discharge, forgiveness, and forbearance options. Inceptia will stay in touch with you via phone calls, letters, and/or emails to help you understand your repayment timing and options.

For additional resources including information on repayment options, please visit Inceptia’s Federal Student Loan Overview website at Inceptia.org/FAQ.