US Government Direct Lending Program
Federal Student Aid
The University of Western Ontario participates in the US government Title IV program known as the William D. Ford Federal Direct Loan Program. American students may apply for Stafford loans; parents of dependent undergraduate students may apply for PLUS loans. In addition to the Stafford loans, graduate and students in professional programs may apply for Grad PLUS loans. Students attending a school outside of the US are not eligible for grants offered through the Direct Loans program.
Direct Loan Annual Loan Limits
*Effective for programs with start dates as of July 1, 2012
|Dependent Undergraduates||Subsidized||Total (Subsidized and Unsubsidized)|
|Third Year and Fourth Year||$5500||$7500|
|Independent Undergraduates and Dependent students whose parents cannot borrow a PLUS loan|
|Third Year and Fourth Year||$5500||$12500|
Graduate and Professional
Total (Subsidized and Unsubsidized)
Direct Loan Aggregate Loan Limits
|Subsidized Only||Total Aggregate (Subsidized and Unsubsidized combined)|
Graduate and Professional
Graduate and Parent PLUS loans – the maximum amount you are able to borrow will be based on the amount requested, the students cost of attendance (as determined by Western University) and the amount of subsidized/unsubsidized loans the student is eligible to receive.
Please review the following topics for further information on Direct lending.
1) US Citizens and Permanent residents of the United States enrolled in an undergraduate or graduate program with a course load that is considered to be at least half time by Western University standards.
2) Students must maintain satisfactory academic progress to continue their annual eligibility for US Loans.
3) Students cannot be enrolled in any course that is delivered online or through distance education while studying at Western. If you are registered in even one course that is an online or distance studies course, you will NOT be eligible for Direct loan funding for the entire study period. All of the courses you are registered in at Western MUST be in-person classroom interaction. We strongly encourage all students to carefully choose their courses to ensure their enrollment meets the United States Department of Education legislation.
4) Students must be registered in main campus courses to be eligible for Direct loan funding. Students registered in any course offered by our affiliated University colleges’ (King’s, Huron or Brescia) will not be eligible to receive Direct loan funding for the entire study period.
5) If you are participating in a formal exchange program through Western University, the following criteria must be met for funding consideration:
- you must be paying tuition to Western
- the school you are attending can't be located in the United States
- the school must participate in the Direct lending program
6) If you have been approved by your Faculty to take courses through a Letter of Permission and you are concurrently taking courses at Western, the following criteria must be met for funding consideration:
- the school you are attending can't be located in the United States
- the school must participate in the Direct lending program
Some programs of study at Western may not meet funding eligibility such as Certificate or Diploma programs. Please contact a Student Financial Aid Officer to discuss your course program details before you apply for US Direct Loan funding.
Parent PLUS loan eligibility:
To apply for and receive Parent Plus funding under the Direct Loan program, you must be the student’s biological or adoptive parent. The student must be a dependent of the parent applying. “Dependent” meaning he or she is under 24 years of age, unmarried with no legal dependents at the time you apply. In order to receive a parent PLUS loan the student must complete the FAFSA.
Step 1: Application
To apply for US Student Loans complete the free application for Federal Student Aid (FAFSA) available at the FAFSA website. The Federal School code for Western University is G08446.
Step 2: Go to studentloans.gov
On this website students/parents can:
- View their loan documents
- Complete Entrance and Exit Counseling
- Sign their Master Promissory Note
- Complete PLUS Request process
- Endorse PLUS loans
All first time borrowers of Stafford or Grad PLUS loans must complete entrance counseling before funding can be released. The U.S. Department of Education also requires all students to participate in Exit Counseling shortly before they graduate, withdraw or cease to be enrolled at least half time.
Students and parents borrowing funds through a Parent PLUS loan must complete a Master Promissory Note (MPN) before funding can be released. The MPN must be e-signed on an annual basis when attending a post-secondary institution outside of the US.
Step 3: Forms
You will also need to complete all relevant forms and submit them to Student Financial Aid.
The Student Budget
Undergraduate and Graduate Students
The budget includes the actual cost of tuition and fees, a standard cost for rent and living costs as well as allowances for the average cost of books, supplies and/or computer, personal expenses and transportation. The budget is used to determine financial aid eligibility in each school year and are reviewed and adjusted on a yearly basis.
If your actual costs for books/supplies or transportation are significantly higher than the budget allowance, you may speak with a Financial Aid Officer directly and prepare any documentation regarding your actual costs for further consideration.
Sample Cost of Attendance
|Cost of Attendance – Undergraduate (September – April – two terms)|
|Tuition and Fees||Based on program cost (see fee schedule)|
|Books and Supplies||$1026 **|
|Relocation Allowance (first year only)||$1000|
|Return Transportation Home||$500|
|Living Allowance (rent, utilities, food)||
**varies based on program
|Cost of Attendance – Graduate (September – December - one term example)|
|Tuition and Fees||Based on program cost (see fee schedule)|
|Books and Supplies||$1104*|
|Relocation Allowance (first year only)||$1000|
|Return Transportation Home||$250|
|Living Allowance (rent, utilities, food)||$5520|
*While every effort has been made to ensure the above cost of attendance is compete and accurae, Western University reserves the right to make adjustments as required.
**varies based on program
Cost of Attendance - Professional Undergraduates and Dentistry Students
Tuition fees vary based on the year you are in the program. Please check our Fees Schedule for tuition costs related to your year. Additional costs such as Association fees, club fees, computer costs and examination fees may be included in your total cost of attendance.
Spouse and Children:
Living costs of family members must be covered by the student and spouse and will not be included in the financial needs assessment. Financial aid, however, can help cover reasonable child care costs for children 12 and under and younger for the period when the student is enrolled and the spouse is working outside the home or also in school full time. If this situation is applicable please speak with a Financial Aid officer directly for review.
Single parents are expected to support children through earnings, savings, child support etc. In some cases where these funds are not available consideration may be given to include some dependent costs in the budget. Documentation may be required to support the additional costs.
Exceptions to the Standard Budget:
Living in Residence:
Students living in residence may have higher living and food costs than associated with the standard student budget. For those students living in residence with a meal plan we will increase your monthly living costs accordingly. You may need to notify our office to confirm your living arrangement.
Additional Housing Allowance:
Students who pay more in rent and utility costs can request a budget increase provided documentation to validate these costs is submitted. Additionally, the student may be asked to present a reason why less costly housing is not an option. Determined on a case by case basis.
Students may request exceptional expenses related to the maintenance of their vehicle. Routine maintenance is not considered in this review. Please contact Student Financial Aid to discuss this directly for a review.
Medical and Dental Expenses:
US Students are insured under the University Health Insurance Plan: https://www.studentbenefits.ca/landingpage?s=82. These plans do not cover all related Medical expenses. In cases where UHIP does not cover the full cost of a medically required treatment these costs may be considered. Cosmetic or elective procedures will not be considered.
A standard budget exists for computer related expenses (not necessarily the purchase of a computer). Printers, software etc, may be considered additional costs for the budget. Appropriate documentation must be submitted and reviewed as reasonable.
License and Professional Fee Expenses:
For those students who require their first professional exam or certifications, the fees will be considered as part of the budget.
Federal Direct Loan Entrance Counseling
All students who are borrowing a Federal Direct Loan for the first time from the University of Western Ontario must complete an online Entrance Counseling Session before any Federal Direct Loan funding can be disbursed.
Entrance Counseling provides you (the borrower) with your rights and responsibilities before you borrow a Federal Direct Loan. It covers information regarding the types of loans you may be eligible to receive, funding loan limits, repayment information, consequences of defaulting on your loan and also provides information concerning the use of your Master Promissory Note.
To ensure that you are completing the application process correctly, the session is available online at studentloans.gov.
Federal Direct Loan Exit Counseling
If you have received a Federal Direct Loan at The University of Western Ontario and you have:
1) Withdrawn from all classes at Western
2) You have dropped courses and are registered in less than half time and will remain registered in less than half time studies until you complete your degree
3) You are graduating from Western or in your last full time term at Western
Student Financial Aid at Western will email you directly should any of these circumstances occur in order that you complete the online Exit Counseling Session. To access the online Exit Counseling session, you will need your FAFSA PIN number.
Exit Counseling provides you with information pertaining to your responsibilities as you start to repay your Federal Direct Loan and review your repayment options.
You may complete your Exit Counseling online at studentloans.gov
If you require your Direct Loan funding to pay your tuition, please apply and submit all required documentation a minimum of 8 weeks prior to your tuition due date. Students who submit a late application may be subject to late payment penalties.
Disclosure of late fees can be found under the Fees Schedule.
Once we have originated your funding through the Department of Education, an email will be sent to you by our Financial Aid Department. This email will notify you of your total funding amount.
Funding received from the Department of Education will be applied automatically to your Student Online Statement of Account within 7-10 business days of the start of your study period date. The second installment will follow the same guidelines with disbursement in January.
Student extending their study in the summer term will have one disbursement during this period within 7-10 business days of the start of their summer term.
Credit balances that result from the disbursement of US Direct Loan funding will be handled in the following manner:
GRADUATE STUDENTS WITH AUTOMATIC DEPOSIT:
The credit balance will be auto deposited to the same account set up through Human Resources . You must fill out the following Authorization form and submit it to Student Financial Aid in order for this to occur.
UNDERGRADUATE /GRADUATE STUDENTS NOT SET UP WITH AUTOMATIC DEPOSIT:
The credit balance will be refunded to you in the form of a cheque for pick up in Student Central located in the lobby of the Western Student Services Building. An email will be sent to you from the Financial Aid office when the cheque is available for pickup. You must present valid photo id.
STUDENTS WITH A FUNDING DISBURSEMENT FROM A PARENT PLUS LOAN:
In order to have the credit balance that resulted from a Parent Plus loan refunded to you, the student, the following Authorization form must be completed by the parent receiving the loan.
STUDENTS REQUESTING TRANSFER OF CREDITS TO OTHER DEPARTMENTS:
Credit balances on a student account can be sent to another department toward outstanding fees on your behalf. Please complete the following Authorization form in order for this transfer to occur
Please view the Western University Satisfactory Academic Progress Policy for Direct loan recipients. If you have any questions regarding this policy, please contact the Student Financial Aid office.
If you withdraw or reduce your course load you must notify Student Financial Aid immediately. Please refer to the Western University Return to Title IV Funds Policy. You are also required to complete an exit counseling session. Online exit counseling can be found on the studentloans.gov website.
You must ensure that your account balance is cleared after the course, tuition and loan adjustments have been made. Please contact the Financial Aid office once you know you will withdraw from your studies. You must also provide us with up to date contact information. Tuition accounts and contact information can be accessed online through Student Center.
For students who have special or extenuating circumstances they would like taken into consideration (Cost of Attendance, Estimated Family Contribution, Dependent Status etc) you may wish to discuss your situation in person with a Student Financial Aid Officer.
Students who fail to meet reasonable academic progress standards may also wish to seek information to appeal their eligibility for further financial aid.
Appointments with a Student Financial Aid officer can be booked through our helpline by calling 519-661-2100.
It is important to understand your rights and responsibilities regarding loan repayment and ensure you maintain your loans in good standing with the Department of Education. You can view the most up to date repayment information online at Student Aid on the Web.
The following provides you the consumer with further information as required by the US Department of Education.
- Western University Code of Student Conduct
- Western Academic Calendar
- The Office of Institutional Planning and Budgeting
- Fire Safety and Emergency Management
- Campus Community Police Service
- Protection of Privacy and Personal Data
The following consumer information connects the student with the consumer information as required by the US Department of Education:
WHAT EVERY STUDENT BORROWER NEEDS TO KNOW.
Before you borrow please read this. If you have already borrowed on a student loan pay particular attention to this Q&A as it will provide valuable information and hopefully keep you out of any legal issue’s concerning your student loan. This Q&A will help answer most of your questions and give you resources to assist you while in school, during a leave of absence/withdrawal and after completion of your program.
We strongly encourage borrowers to carefully weigh the need for loans and to borrow only what is actually needed. We encourage you to estimate and plan your repayment obligations prior to borrowing. Borrowing in excess of what is actually needed means you must repay more at a later date. Your monthly payments will be higher and you may be paying over a longer period of time due to the interest that accrues on your loans.
For federal student and parent loans, borrowers should be aware of the repayment options that are available. In addition, there are a number of deferment or forbearance provisions available once the loan is in repayment. For some qualifying majors and professions, such as teaching, federal and state loan cancellation provisions can also be beneficial.
Click here for estimate, repayment, deferment and forbearance options.
Click here for Loan Forgiveness Program Information.
Remember, loans must be repaid even if you did not complete your program and/or degree.
To keep track of your student loans or to contact your loan servicer for repayment, log onto to the National Student Loan Data System (NSLDS) at www.nslds.ed.gov or call the Federal Student Aid Information Center at 1-800-4-FED-AID (1-800-433-3243; TTY 1-800-730-8913). The PIN number that you used as your electronic signature for the FAFSA can also be used to gain access to NSLDS.
This website will not only show you all of the federal and private loans you borrowed, but also who the servicer is for your loan(s). The servicer is the entity you will be corresponding with to coordinate repayment.
To see a list of Federal Student Aid servicers for the Direct Loan Program and for FFEL Program Loans purchased by the U.S. Department of Education, go to the Loan Servicer page.
If you have borrowed loans in the past through the FFEL Program (i.e. a federal loan serviced by Bank of America, Wells Fargo, Citibank, etc.) these loans have most likely been sold to a third party processor. We cannot stress enough how important it is to know your loan servicer. Please refer to “Understanding the PUT Program” under the loan consolidation section.
If you are expecting to borrow a Federal Stafford or Federal PLUS Loan for this coming year and also have a Federal Family Educational Loan, Stafford or PLUS Loans from prior years, you will have at least two lenders to repay when you graduate: your selected private lender and the federal government.
The Direct Lending Consolidation program offers a way for you to combine both loans into one consolidation loan with one point of repayment. This loan consolidation program will be available to you once you graduate and begin thinking about repayment.
There are advantages and disadvantages to loan consolidation and we recommend that you research this option carefully before proceeding. If you have questions about whether or not consolidation is right for you, please contact the Direct Loan Consolidation Loan Information Center at www.loanconsolidation.ed.gov.
Who is eligible for loan consolidation?
To qualify for a Direct Consolidation Loan, borrowers must have at least one Direct Loan or Federal Family Education Loan (FFEL) that is in grace, repayment, deferment or default status. Loans that are in an in-school status cannot be included in a Direct Consolidation Loan.
What is PUT program?
Since 2008 Stafford lenders have sold some of their loans to the Department of Education in an attempt to build liquidity in the market and provide more loans to students. This is called the Loan Purchase Commitment (PUT) Program.
As a result, continuing students may have already received communication from the Department of Education explaining the purchase. These loans are not considered Direct Loans but continue to be part of the Federal Family Education Loan Program (FFELP).
It is important to note that loans borrowed in the future may not have the servicer as loans you have borrowed already. This means that when you begin to make payments on your loans after graduation you may be making multiple payments to multiple entities.
Your loan servicer will provide information about repayment and will notify you of the date your loan repayment begins. It is very important that you make your full loan payment on time either monthly (which is usually when you’ll pay) or according to your repayment schedule.
If you don’t, you could end up in default, which has serious consequences (see What is Loan Default?). Student loans are real loans—just as real as car loans or mortgages. You have to pay back your student loans.
Can you repay your loans while in school? Yes! Contact your loan servicer through www.nslds.ed.gov.
After borrowers graduate, leave school, or drop below half-time enrollment, loans that were made for that period of study have several months before payments are due. This is called the “grace period”.
Grace periods extends to 6 months after borrowers leave school or ceases to be enrolled in at least half time enrollment for 6 months. Grace periods can also extend up to 12 months; however, you must contact your loan servicer directly.
During the grace period, no interest accrues on subsidized loans. Interest accrues on unsubsidized loans during grace periods, and this interest is capitalized when borrowers enter repayment.
Borrower repayment period begins the day after their loan grace period ends. First payment will be due within 60 days after the repayment period begin.
Each loan has only one grace period. If borrowers return to school after the grace period has expired, the borrower qualifies for deferment while borrowers are enrolled but return to repayment after borrower leave school. There is no additional grace period.
You are able to make payments on your student loan while you are still enrolled. If you have unsubsidized loans, you are able to make payments on your interest that is accruing.
When it comes time to start repaying your student loan(s), you can select a repayment plan that’s right for your financial situation. Generally, you’ll have from 10 to 25 years to repay your loan, depending on which repayment plan you choose.
With the standard plan, you’ll pay a fixed amount each month until your loans are paid in full. Your monthly payments will be at least $50, and you’ll have up to 10 years to repay your loans.
Your monthly payment under the standard plan may be higher than it would be under the other plans because your loans will be repaid in the shortest time. For that reason, having a 10-year limit on repayment, you may pay the least interest.
To calculate your estimated loan payments, go to the Standard Repayment plan calculator.
Under the extended plan, you’ll pay a fixed annual or graduated repayment amount over a period not to exceed 25 years. If you’re a FFEL borrower, you must have more than $30,000 in outstanding FFEL Program loans. If you’re a Direct Loan borrower, you must have more than $30,000 in outstanding Direct Loans.
This means, for example, that if you have $35,000 in outstanding FFEL Program loans and $10,000 in outstanding Direct Loans, you can choose the extended repayment plan for your FFEL Program loans, but not for your Direct Loans. Your fixed monthly payment is lower than it would be under the Standard Plan, but you’ll ultimately pay more for your loan because of the interest that accumulates during the longer repayment period.
This is a good plan if you will need to make smaller monthly payments. Because the repayment period will be 25 years, your monthly payments will be less than with the standard plan. However, you may pay more in interest because you’re taking longer to repay the loans. Remember that the longer your loans are in repayment, the more interest you will pay.
To calculate your estimated loan payments, go to the Extended Repayment plan calculator.
With this plan, your payments start out low and increase every two years. The length of your repayment period will be up to ten years. If you expect your income to increase steadily over time, this plan may be right for you.
Your monthly payment will never be less than the amount of interest that accrues between payments. Although your monthly payment will gradually increase, no single payment under this plan will be more than three times greater than any other payment.
To calculate your estimated loan payments, go to the Graduated Repayment plan calculator.
Income Based Repayment (IBR) – Effective July 1, 2009
Income Based Repayment is a new repayment plan for the major types of federal loans made to students. Under IBR, the required monthly payment is capped at an amount that is intended to be affordable based on income and family size.
You are eligible for IBR if the monthly repayment amount under IBR will be less than the monthly amount calculated under a 10-year standard repayment plan. If you repay under the IBR plan for 25 years and meet other requirements you may have any remaining balance of your loan(s) cancelled.
Additionally, if you work in public service and have reduced loan payments through IBR, the remaining balance after ten years in a public service job could be cancelled. For more important information about IBR go to IBR Plan Information.
Loan default is failure to repay a loan according to terms of the Master Promissory Note. There can be serious legal consequences for student loan defaulters.
There are different options to prevent falling into default status.
The following are some options:
Deferment = a postponement of payment on a loan that is allowed under certain conditions and during which interest does not accrue for subsidized loans. This request can be made if you are returning to school and are enrolled in at least half-time status. For Deferment options, click here. Please contact your loan servicer for more information.
Forbearance = a period during which your monthly loan payments are temporarily suspended or reduced.
You may qualify for forbearance if you are willing but not able to make loan payments due to certain types of financial hardships.
A complete list of Direct Loan forbearances and their eligibility criteria can be reviewed at www.dlservicer.ed.gov.
Repayment Plan = Changing repayment plans is a good way to manage your loan debt when your financial circumstances change. For example, you can usually lower your monthly payment by changing to another repayment plan with a longer term to repay the loan. There are no penalties for changing repayment plans.
If you default, it means you failed to make payments on your student loan according to the terms of your promissory note, the binding legal document you signed at the time you took out your loan. In other words, you failed to make your loan payments as scheduled. Your school, the financial institution that made or owns your loan, your loan guarantor, and the federal government all can take action to recover the money you owe.
Consequences of Default
National credit bureaus can be notified of your default, which will harm your credit rating, making it hard to buy a car or a house.
You will be ineligible for additional federal student aid if you decide to return to school. Loan payments can be deducted from your paycheck.
State and federal income tax refunds can be withheld and applied toward the amount you owe.
You will have to pay late fees and collection costs on top of what you already owe
You can be sued.
If you are having a problem with your federal student loan, contact the FSA Ombudsman at the US Department of Education. The FSA Ombudsman is dedicated to helping students resolve disputes and other problems with federal student loans.
The FSA Ombudsman will research your problem in an impartial and objective manner and will try to develop a fair solution. The FSA Ombudsman does not have the authority to impose a solution. Nevertheless, many students have found the FSA Ombudsman to be helpful in resolving disputes with lenders.
You can contact the FSA Ombudsman by phone at 1-877-557-2575, by fax at 1-202-275-0549, by mail at U.S. Department of Education, FSA Ombudsman, 830 First Street, NE, Fourth Floor, Washington, DC 20202-5144, by visiting fsahelp.ed.gov or by e-mail at email@example.com.
For more information and to learn what actions to take if you default on your loans see the Department of Education’s Default Resolution Group Web site.
Western University is committed to helping you be successful while in school and after you have graduated or while taking time off of school. We understand finding a job or maintaining employment in our given economy can be difficult as well as managing your student loans.
Important: Remember, you are responsible to repay your student loans as agreed on your signed Master Promissory Note(s). Please keep your contact information up to date with your loan servicer to ensure you receive important correspondence.
When in doubt, contact your loan servicer. Staying in touch with your loan servicer will maintain a good relationship and decrease the chances of loan default.
If you are seeking legal representation, please read more information on “Civil Legal Assistance Attorney Student Loan Repayment Program Questions and Answers.”