FEDERAL FAMILY EDUCATIONAL LOAN PROGRAM POLICIES
(STUDENT LOANS)


The Federal Family Educational Loan Program (FFELP) is a part of the federal student aid programs. FFELP loans
consist of three major types of loans that include the Subsidized Stafford Loan, Unsubsidized Stafford Loan and Parent
(PLUS) Loan.

Eligibility for these programs is determined by using information from the FAFSA Institutional Student Information Record
(ISIR). The subsidized loan is considered first because the federal government pays the interest on the loan while the
student is enrolled in school at least half-time and during the six-month grace period. The unsubsidized loan is considered
next, and the borrower will be responsible for the interest on the loan. Parents wishing to borrow a PLUS Loan for their
dependent child’s educational costs may borrow up to the Cost of Attendance.

On July 1, 2006, interest rates were set at a fixed rate by the Federal Reserve for Unsubsidized Stafford Loans and PLUS
loans. The rates are 6.8% and 8.5% respectively. However, as part of the College Cost Reduction and Access Act
(CCRAA) of 2007, all Subsidized Stafford Loans disbursed on or after July 1, 2008 through June 30, 2009 will have a lower
interest rate of 6.0%. Another cost of borrowing under these programs is a 1.0% origination fee and a 1.0% insurance
premium. Some lenders have opted to waive one or both of these fees. The Financial Aid Office has many forms of
printed information that may be used to make an informed decision about borrowing money for educational costs. A
helpful internet website is http://studentaid.ed.gov .

1. In order to complete an application for a student loan, a borrower must have completed a federal need analysis
application, the FAFSA, and have received the official Student Aid Report. Before completing the student loan application,
a student must complete a Student Loan Entrance Interview. This interview is available online at
www.mappingyourfuture.org.

2. Federal Stafford Loan requests will be restricted by semester to one-half of the maximum available to a student for the
academic year. (The full-time freshman maximum per year is $3,500. The full-time freshman maximum per semester is
$1,750.) Conservative borrowing is encouraged. Loans may be certified for less than the maximum amount for the grade
level and enrollment status.

3. Federal Stafford Loan requests for less than full-time enrollment will be prorated by the enrollment status (¾ time or ½
time) stated on the FFELP Notification of Interest submitted to the Financial Aid Office. No changes will be made after
certification. Students enrolled less than half-time time are not eligible to apply for or receive a student loan.

4. Loan maximums are for a calendar year. A student, if eligible, may borrow the applicable yearly maximum loan amount
during a period between July 1 and June 30.

5. Students may borrow only one time per grade level, once at the freshman level and once at the sophomore level. For
these purposes, a freshman is considered to be anyone who has successfully completed up to 29 semester credit hours.
A sophomore is anyone who has successfully completed 30 or more credit hours. Upon special request and approval by
the Financial Aid Office, a student’s loan eligibility may be extended for one additional year.

6. First-year (less than 30 credit hours completed), first-time borrowers may not collect the proceeds of their first loan
disbursement until 30 days after the beginning class day for their first semester of enrollment.

7. Loan applications must be completed by the student and the Southeast Arkansas College Financial Aid Office by the
following deadlines:

Fall Semester -- October 1
Spring Semester -- March 1
Summer Mini-sessions -- June 1

8. Student loans are prorated according to the enrollment period and enrollment status.
• No loans will be certified for students enrolled in more than 50% developmental courses. The developmental
coursework prepares a student for college level work and does not count toward the degree or technical
certificate program.
• Students with a prior student loan balance will be subject to the loan limits of the various loan programs
for the current classification (freshman, sophomore). Transfer students must transfer a minimum of 30 credit
hours toward their degree at Southeast Arkansas College in order to borrow at the sophomore level. Students
with a loan balance above the freshman and sophomore maximums may not apply for additional student loan
funds.


For more information about financial aid and its policies and procedures, contact the Southeast Arkansas College
Financial Aid Office at (870) 543-5909.