Student Loan Information
Federal Perkins Loans
EMU is the lender. The interest rate is 5%; repayment of principal and interest are deferred until nine months after graduation or enrollment status is less than half-time. There are numerous Federal Perkins Loan Teacher Cancellation provisions. These funds are awarded to students with exceptional financial need. No separate application is required. A student accepts the loan by signing a promissory note following enrollment.
Federal Stafford Loans
A Federal Stafford Loan is either subsidized or unsubsidized. Loan funds come from a bank, Savings and Loan, or other approved lender. A subsidized loan is awarded on the basis of financial need. The federal government pays interest on the loan until the student begins repayment and during authorized periods of deferment. An unsubsidized loan is not awarded on the basis of financial need.
The student is charged interest from the time the loan is disbursed until it is paid in full. If the student allows interest to accumulate, it will be capitalized - that is, the interest will be added to the principal amount of the loan and will increase the amount of loan the student will need to repay. Students may borrow up to:
- $3,500 each year if you are a first year student;
- $4,500 each year if you have completed at least 24 credit hours;
- or $5,500 each year if you have completed at least 56 credit hours.
The total debt from all outstanding Stafford Loans are fixed (currently 6.8%) and can be adjusted each year on July 1, but may not exceed 8.25 percent. A student pays to the lender a "loan origination and guaranty fee" of up to three percent which is automatically deducted from each disbursement of the loan.
Repayment of the full amount begins six months after a student ceases to be enrolled at least half-time. There are Federal Stafford Loan Cancellation provisions up to $5,000. See also the Federal Stafford Loan Information page.
Additional Unsubsidized Stafford Loans
Additional unsubsidized Stafford Loan funds are available to independent students. Annual loan limit is $4,000 for first and second year, and $5,000 for remaining undergraduate years.
Alternative (Private) Loans
Alternative loans are designed to assist students and their families who either are not eligible for federal grant and loan funds, or who need additional educational financing. Loan approval is generally based on creditworthiness and ability to repay.
Alternative loans are available to students who are pursuing a degree program at Eastern Mennonite University enrolled at least half-time, and maintaining satisfactory academic progress.
As with any loan, careful consideration should be made in determining amounts to be borrowed, as the loan must be repaid. The interest on most alternative loans accrues while the student is in school. However, it can be deferred (in many cases) until after graduation or when the student ceases to be enrolled at least half-time.
