Learn About Your Stafford Lender

Q. How do I get my Stafford Loan?
To obtain the Stafford Loan eligibility which you have been offered and accepted, you must take several steps. 1.) select a lender, 2.) e-sign a Stafford Master Promissory Note (MPN) on the lender's website if you have not done so in the past, 3.) return the Choosing Your Lender Form (or Stafford Non-Streamlined lender form) to our office (you may fax the completed form to our office at 504-862-8750) and 4.) complete an Entrance Interview if you are a first-time Stafford borrower. Stafford Loans for an academic year are disbursed (most often electronically into a student account) when classes begin, half in the fall semester and half in the spring semester.

Q. How do I choose my Stafford lender?
To help in choosing a lender, we have prepared a STREAMLINED LENDER LIST by comparing the services and terms of several lenders. Tulane has coordinated with various lenders to expedite processing and delivery of federal student loans. Arrangements with these streamlined lenders allow for direct disbursement of loan funds to Tulane via electronic funds transfer (EFT). The EFT loan process enables loan proceeds to be credited to student billing account and eliminates time-consuming paper processing. These lenders are known for making quality service available to both the students and universities they serve. Keep in mind, the relationship you initiate in the processing of your first loan application could last a long time. In addition, once you select a lender, we strongly recommend that you continue to borrow from that lender for all your education loans. Picking the right lender for your student loan is an important decision. The streamlined lenders have helped thousands of students achieve their education goals.

How We Choose Our Lender List
As a service to our student and parent educational loan borrowers, Tulane's University Financial Aid Offices have attempted to identify a list of lending institutions who we believe offer quality customer service and benefits with their respective federal and/or non-federal loan products.

The composition of our list of suggested lenders is the result of our annual "request for proposals" (RFP) process, in whichinterested lenders submit proposals for our consideration. The main criteria we expect from lenders include all of the following:

reliable customer service (including service during processing and repayment);
competitive loan products (including competitive fees and interest rates);
electronic disbursement of funds;
allowance for borrower electronic repayment of loan funds; and
cost saving benefits to borrowers throughout the life a loan.

The Tulane "Loan Committee" reviews and researches each proposal received each year before finalizing a list of lenders meeting the criteria. We want to assure all educational loan borrowers that Tulane's University Financial Aid Offices does not receive any form of payment or remuneration from lenders in exchange for inclusion on our lender listing. As long-time members of the National Association of Student Financial Aid Administrators (NASFAA), the employees of Tulane's University Financial Aid Offices fully adhere to NASFAA's Statement of Ethical Principles and Code of Conduct for Institutional Financial Aid Professionals.

Please know there is absolutely no obligation for borrowers to select a lender from our lender listing. Student and/or parent borrowers have the right to select a lender of their choice. Per federal and institutional guidelines, the University Financial Aid Offices will process any loan from any lender.

PLEASE NOTE: The RFP information used for the 2008-09 award year in many cases represented information which was subsequently changed by the lenders. We wish to point out that our list of lenders was chosen using the original information received in January 2008.

The Tulane University Financial Aid Offices remain committed to the students we serve. As such, we will continue to annually review our suggested lenders to ensure that our students and their families receive reasonable rates and good customer service.

Q. What is an Entrance Interview?
A: Students must complete an Entrance Interview before Stafford loan funds can credit to their student account as per Federal regulation. The Financial Aid Office schedules Entrance Interviews at the beginning of each semester for first-time Stafford loan borrowers. During the Entrance Interview, counselors review the terms of the loan, borrower rights and responsibilities, and the consequences of default.

Students can attend the session during Orientation in August (see Orientation schedule for date and time) or complete the Entrance Interview online at Mapping Your Future (the website forwards the names of students who completed the Entrance Interviews to the Financial Aid Office). Students who use the online option are encouraged to print out the Entrance Interview completion confirmation.

Note: The average stafford loan indebtedness for a full time undergraduate at Tulane University is $16,620.

Q : Can a choice of a Stafford lender save you money?
A : You can save some money by choosing a lender with the lowest fees.

Q : Are some Stafford lenders faster?
A : "Turnaround time" varies by lender. Streamlined lenders are committed to delivering fast loan disbursements as a priority.

Q : What is a servicer?
A : Servicers simply bill borrowers and collect payments on behalf of lenders. They also process address updates, deferments (which delay loan repayment), and forbearances (which delay loan repayment).

Q : Does customer service matter?
A : Yes. When you call a servicer or lender, you may want to speak with a person, not simply a voice system. Good customer service staffs can answer all your questions about education financing.

Q : What else should I know before I choose a Stafford lender?
A : Of course, never borrow more than is absolutely necessary. The more money you borrow, the more future income is already spent. You can view tips on limiting your level of borrowing in the general Stafford Loan section of our website.

Q : Do all Stafford lenders charge the same interest rate?
A : All lenders are required by federal law to charge the same interest rate. Loans made on or after July 1, 2006 until June 30, 2010 will have a fixed rate of 6.80%. After that time, Subsidized Stafford Loans made to undergraduate students may have a lower fixed rate, but all lenders will follow the same pattern. Some lenders may offer a repayment benefit (which is not part of a promissory note and may be canceled at any time) which may effectively lower the cost of a loan.

Interest rates for Federal Stafford Loans which are Unsubsidized and/or for graduate level study and disbursed after July 1, 2006 will be a fixed rate of 6.8%.

Interest rates for Federal Stafford Loans which are Subsidized at the undergraduate level and disbursed after July 1, 2008 will be a fixed rate. However, the fixed rate will vary (see below).

"Over a four-year period beginning July 1, 2008, the interest rate on subsidized Stafford Loans made to undergraduate students will be reduced. The applicable interest rates for loans made during this period are as follows:

These changes apply to subsidized Stafford loans first disbursed on or after July 1 of each year through June 30 of the next year. This change does not affect any prior loans made to borrowers; the terms and interest rates of those loans remain the same. These reduced interest rates apply only to subsidized loans; any unsubsidized Stafford Loan for the same undergraduate borrower would continue to be made at the current fixed interest rate of 6.8 percent."
Source: http://www.studentaid.ed.gov/PORTALSWebApp/students/english/studentloans.jsp?tab=funding

Stafford Loans disbursed 7/1/2006-6/30/2008 have a fixed rate of 6.8%.

Stafford Loans disbursed 7/1/1998-6/30/2006 have a variable interest rate.