Low-interest loans are available to help pay for educational costs. Eligibility for some loans may be listed on a student's University of Maine Award Notification, but additional steps must be taken in order to actually receive the loan funds. Allow for processing time.

• Types of student loans
• How to apply
• Annual Stafford Loan Limits - New as of 7/1/08
• Lifetime Stafford Loan  Limits - New as of 7/1/08
• Important Note
• Do you need to borrow at all?
• Loan Repayment and Consolidation

Stafford and Grad-PLUS Entrance and Exit Counseling

Complete the necessary Entrance and Exit Counseling by checking on the appropriate link below:

Complete on-line Stafford Loan Entrance Counseling (to be completed the first time your borrow a Stafford Loan)

Complete on-line Grad-PLUS Entrance Counseling (to be completed the first time you borrow a Grad-PLUS Loan)

Complete on-line Stafford Loan Exit Counseling (to be completed when you graduate or are not longer enrolled at least half time)

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Types of student loans

Federal Perkins Loans

You apply for the Perkins Loan by completing the Free Application for Federal Student Aid (FAFSA); unlike other student loans, a separate application is not required. If you are eligible, the Perkins Loan will be listed on your University of Maine Award Notification. The first time you borrow a Perkins Loan, you must complete a Perkins Loan Master Promissory Note (MPN).  This will be mailed to you, typically in June, and must be returned to the University of Maine's Student Loan Collection Office.  Each year that you receive a Perkins Loan, you must complete a Perkins Loan Disclosure.  This can be done by visiting the Financial Aid segment of WebDSIS. 

 

Federal Stafford Loans

These variable-rate loans, guaranteed by the federal government, are available to students who apply for financial aid using the FAFSA. The student chooses a participating lender, such as a bank or credit union (most require that you be a member), and applies through the University of Maine Office of Student Financial Aid. Payment on the principal is not required until 6 months after the student leaves school, as long as the student remains enrolled at least half-time. The interest rate maximum is 8.25%. There are two types:

 

Subsidized Stafford Loans are need-based loans. The government will pay the interest on the loan to the lender while the student is enrolled at least half-time and during other authorized periods called "deferments".

Unsubsidized Stafford Loans are available to students who do not qualify for need-base loans, or who qualify for less than the annual maximum of subsidized Stafford Loan. The government does not pay the interest to the lender; the student can choose to either pay the interest while in school, or have the interest added to the loan principal to be repaid later.

 

Federal PLUS Loans

Parent Loans to Undergraduate Students (PLUS) are variable-rate loans provided by participating lenders to parents of dependent students. The lender must perform a minimal check of the borrower's credit history. Payment of principal and interest begins once the loan is disbursed to the student's University of Maine account. It is not necessary to file a FAFSA in order to apply for a PLUS Loan; please contact our office for details.

 

Other Loans

There are other private organizations which provide alternative educational loans to students to either supplement the kinds of loans listed above, or provide an additional source of loan funds. Most are credit-based loans, and will require periodic payments of principal and interest once disbursed. Interest rates vary, and a separate application is usually sent directly to the lender, which is then forwarded to the Office of Student Financial Aid for certification of the student's status.

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How to apply

1. Apply for financial aid and watch for an Award Notification.

• A Stafford Loan application section will be included on the back of your Award Notification. If you have never borrowed a Stafford Loan at the University of Maine, a Lender List will also be included in your Award Notification.  You can also request a Stafford Loan by completing a UMaine Stafford Loan Request Form, available from the Office of Student Financial Aid or on-line by visiting the Financial Aid segment of WebDSIS;
• PLUS Loan Request Forms are available from the Office of Student Financial Aid;
• Other loan applications can be obtained by contacting those organizations.

2. Fill out the request form/loan application and turn it in to the Office of Student Financial Aid. Watch for a e-mail notification from us letting you know your loan was certified.

3. First time Stafford Loan borrower requirements:

• Stafford Loan Master Promissory Note (MPN) - A Stafford Loan MPN is a one time requirement (so long as you continue to borrow from the same lender) that must be completed the first time you borrow a Stafford Loan.  Your MPN can be signed electronically, unless you borrowed from a non-FAME guarantee lender. The link to the Sallie Mae website where you can complete the MPN will be included in the e-mail we send you after we certify your loan (unless you do not have a valid FirstClass e-mail address in which case we will send you a paper letter).  The MPN cannot be completed electronically until we certify your loan, but must be signed before any funds can be disbursed to the UMaine Bursar's Office.   

• Stafford Loan Entrance Counseling - Stafford Loan Entrance Counseling is a one time requirement that must be completed the first time you borrow a Stafford Loan.  Stafford Loan funds cannot be disbursed to the UMaine Bursar's Office until this requirement is complete. During the Stafford MPN signature process, you will be automatically prompted to complete the required Stafford Loan Entrance Counseling.  Both of these requirements must be completed before you can receive your Stafford Loan funds.  Stafford Loan Entrance Counseling can also be completed on-line from the Financial Aid website.

4. Obtain the loan proceeds from the University of Maine's Bursar's Office each semester once available.

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Annual Stafford Loan Limits

Federal regulations specify the maximum Federal Stafford Loan amount any student can borrow each academic year, depending upon grade level. Actual eligibility is specified on the University of Maine Award Notification and may be less than the annual maximum:

Effective July 1, 2008

Grade Level and Dependency	Credit Hours Earned	Maximum Subsidized Stafford	Maximum Stafford (subsidized and unsubsidized)
Dependent first-year	less than 24	$3,500	$5,500
Dependent sophomore	24 -53	$4,500	$6,500
Dependent junior or senior	54 and above	$5,500	$7,500
Independent first-year	less than 24	$3,500	$9,500
Independent sophomore	24-53	$4,500	$10,500
Independent junior or senior	54 and above	$5,500	$12,500
Graduate student	any credit hours	$8,500	$20,500

NOTE: Dependent students whose parents are denied a Federal PLUS Loan are eligible for the independent student limits if there is a valid PLUS Loan denial (dated within the last year) on file with our office.

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Lifetime Stafford Loan Borrowing Limits

There are also lifetime limits regarding how much Stafford Loan you can borrow and the limits are as follows:

Effective July 1, 2008

Grade Level and Dependency	Maximum Subsidized Stafford	Maximum Stafford (subsidized and unsubsidized)
Dependent undergraduate	$23,000	$31,000
Independent undergraduate	$23,000	$57,500
Graduate student	$65,500	$138,500

Note:  The graduate debt limit includes loans received for undergraduate study.

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Important Note

Stafford Loan disbursements are reduced by the fees of 2.5% (2.0% as of July 1, 2008) and PLUS disbursements are reduced by the fees of 4.0% paid to the lender and guaranty agency.

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Do you need to borrow at all?

Think twice before borrowing any loan; don't borrow just because you may be eligible. Take into consideration any other financial aid you are receiving before you borrow. Look into how much you may have available from your own resources before you borrow. Carefully evaluate your costs to see if you can reduce your expenses before you borrow. Taking out a loan should be your last resort, not your first option.

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 Loan Repayment and Consolidation

What will your monthly payment be once you begin repaying your loans? Use the following chart as a guide.

Number of Payments	Loan Amount	Monthly Payment amounts at
		6% Interest	8% Interest	10% Interest
36	$2,000	$61	$63	$65
108	$4,000	$50	$52	$56
120	$10,000	$111	$121	$132
120	$20,000	$222	$243	$264

Some students may want to consider consolidating their federal student loans into a Consolidation Loan.  This is an option that has both pros and cons, so be sure you investigate this option carefully.  For more on Consolidation Loans, click here.

 

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