There are many sources of student financial aid, and most students and their families use a combination of aid sources to fund educational costs.
Loans are a form of self-help aid that need to be repaid once a student leaves school or drops below half-time enrollment. Students must complete a Free Application for Federal Student Aid (FAFSA) in order to be eligible for federal loans.
If you choose to access loan funds, you are required to complete a Master Promissory Note (MPN) as a freshman/transfer student, which will encompass all federal Stafford Loan debt while in attendance at Rivier University. All students are encouraged to only borrow what they need, and to take advantage of valuable financial literacy tools as they plan their college financing.
Federal Direct Subsidized Loan
This is a federally subsidized, low-interest loan that is awarded based on financial need. Repayment begins six months after a student ceases to be enrolled at least half time or completes his/her course of study. The federal government pays the interest during periods of at least half-time enrollment. Award amounts are based on cumulative credits earned towards a specific degree program. The interest rate is set by the federal government annually. The Department of Education will deduct an origination fee from these funds prior to disbursement to the University. Annual borrowing limits for undergraduates are: $3,500 for freshmen; $4,500 for sophomores; and $5,500 for juniors and seniors.
Federal Direct Unsubsidized Loan
Students that do not qualify for federal subsidizing may borrow under the Federal Direct Unsubsidized Loan Program. The major difference between the subsidized and unsubsidized programs is that the student is responsible for the interest on unsubsidized loans while in school; arrangements can be made for either capitalization or monthly payment on interest. Independent undergraduates can borrow an additional Unsubsidized Direct Loan up to $6,000 in their freshman and sophomore years, and up to $7,000 in their junior and senior years. Graduate students can borrow a maximum amount of $20,500 per academic year. The interest rate is set by the federal government annually. The Department of Education will deduct an origination fee from these funds prior to disbursement to the University.
Note: Amounts borrowed cannot exceed the student’s cost of education nor aggregate borrowing limits. Rivier’s latest loan cohort default rate is 4.0% compared to the national average of 10.8%.
Full disclosure of the terms of the Federal Direct Loan are provided on the Master Promissory Note. Rivier University processes Federal Direct Loans electronically. All students borrowing under the Federal Direct Loan Program for the first time at Rivier University are required to complete Entrance Loan Counseling at www.studentloans.gov. This requirement is designed to educate student loan borrowers of their rights and responsibilities. Please note that you must have a Federal Student Aid ID (FSA ID) and password in order to log in to this website. If you have not done so already, you can create an FSA ID now.
Below is a sample loan repayment schedule for a student who accepted $27,000 in Federal Direct Loans over the four years in which they were enrolled:
|Adjusted Loan Balance||$27,135.68|
|Loan Interest Rate||6.80%|
|Loan Term||10 years|
|Monthly Loan Payment||$312.28|
|Number of Payments||120|
|Total Interest Paid||$10,473.31|
Note: The monthly loan payment was calculated at 119 payments of $312.28 plus a final payment of $311.99.
The loan balance was adjusted to yield $27,000.00 after deducting the 0.50% loan fees.
It is estimated that you will need an annual salary of at least $37,473.60 to be able to afford to repay this loan. This estimate assumes that 10% of your gross monthly income will be devoted to repaying your student loans. This corresponds to a debt-to-income ratio of 0.7. If you use 15% of your gross monthly income to repay the loan, you will need an annual salary of only $24,982.40, but you may experience some financial difficulty. This corresponds to a debt-to-income ratio of 1.1.
More information on federal loan repayment is available.
If you are experiencing difficulty repaying your loans, you may be able to request help repaying your loans. There are forbearance and deferment options, as well as a number of different repayment plans. Please contact your loan servicer as soon as you experience difficulty repaying your loans. They can help you! If your loans go into default, there are serious consequences including a damaged credit history, possible wage garnishment, and more.
Federal Direct PLUS Loan
This loan program allows parents of undergraduate students to borrow up to the cost of education less any financial aid. The fixed interest rate is capped at 9% and repayment, beginning 30 days after full disbursement of the loan, may extend up to ten years. The interest rate is set by the federal government annually. The Department of Education will deduct an origination from these funds prior to disbursement to the University.
Again, students are encouraged to research different lenders. You are not required to choose one of these lenders; you can choose any lender you wish.
Check out this website to calculate the cost of your loans.