Important Contact Information
Federal Student Aid Information Center
(800) 433-3243
www.studentaid.gov
Direct Loan Servicing
(Students and Parents)
(800) 848-0979
www.studentaid.gov
Defaulted Student Loan
(800) 621-3115
https://myeddebt.ed.gov/
Direct Consolidation Loans
(800) 557-7392
https://studentaid.gov/manage-loans/consolidation
Federal Direct Loan Process
Passaic County Community College participates in the Federal Direct Loan program. All students who have completed the Free Application for Federal Student Aid (FAFSA) are presented with an estimated loan amount as part of the Offer Letter. Loan estimates are computed annually (fall and spring) based on a student’s projected full-time enrollment.
Types of Loans
The federal government provides two types of Direct Loans:
- Federal Direct Subsidized Loans – Direct Subsidized loans are based on need. If qualified, the federal government pays the interest while the student is in school and enrolled on at least a half-time basis.
- Federal Direct Unsubsidized Loans – Direct Unsubsidized loans are NOT based on need and the student is responsible for the interest that accrues while attending school. The student has the option to pay the interest while in school, and if they choose not to do so, the interest will be added to the principal balance through a process called capitalization. The student will then pay interest on a higher loan amount.
The Direct Loan origination fee varies and is currently 1.057%
Funds are posted and credited to a student’s tuition account after the Enrollment Verification process whereby the following criteria are confirmed:
- Enrolled in six [6] or more credits
- Satisfactorily meeting the Financial Aid Standards of Academic Performance and Progress (SAP) as described in the current college catalog
- Completed Direct Loan Entrance Counseling https://studentaid.gov/entrance-counseling/
- Completed a Master Promissory Note (MPN) https://studentaid.gov/mpn/
The Master Promissory Note is good for 10 years and can be used for multiple disbursements.
Once the Entrance Counseling and Master Promissory Note has been completed the college receives an electronic notification of your completed Loan Counseling and MPN.
Institutional Loan Code of Conduct
If you are a student at PCCC and were awarded an estimated student loan in your Offer Letter, you are required to inform us if you wish to accept or decline the student loan awarded to you.
This process is completed by the student logging onto their student portal and accessing the financial aid Self-Service home menu. The student will accept/decline the loan offer.
Information is periodically reviewed by the Loan Coordinator who updates the students’ financial aid record with the corresponding decision.
If the loan is accepted, the student must complete Entrance Counseling and sign a Master Promissory Note.
If the student has already borrowed a Federal Direct Loan at PCCC they will not have to complete the Entrance Counseling or Master Promissory Note.
If the student borrowed a Federal Direct Loan at another school within the last ten years, they would not need to complete another MPN; however, they will need to complete Entrance Counseling.
Note: Before you proceed keep in mind Federal Direct Loan repayment begins once you graduate, withdraw from school, or drop below 6 credits.