LOAN UPDATE:  Learn more about Coronavirus and Forbearance Information for Students, Borrowers, and Parents.


Financial aid loans are low-interest loans for students or parents and are often awarded based on financial need. These must be repaid.  To qualify for most loans, you must file the Free Application for Federal Student Aid (FAFSA). You need to file a FAFSA every year you are in college.

Federal Direct Stafford

The Direct Stafford Loan Program is one of the Federal Student Aid programs of the U.S. Department of Education. Generally known as Stafford Loans, these can provide you with a simple, convenient, and flexible way to borrow money to pay for your education.

The process is simple for borrowers. Direct Loan borrowers first need to complete the Free Application for Federal Student Aid  (FAFSA). Based on the information provided on the FAFSA, our office will determine the type and amount of financial aid you are eligible to receive.

Types of Direct Loans

Direct Stafford Subsidized Loan (Undergraduate Only)

With a subsidized loan, the government pays the interest on this loan while you are attending school at least half-time and for loans first disbursed on or after July 1, 2015, during the six-month grace period, which begins after you graduate or stop attending at least half-time.

Direct Stafford Unsubsidized Loan

You can get this loan regardless of your family’s income. This loan is a non-need-based loan, and you must pay the interest on a semiannual basis while you are enrolled in school and during the grace period, or the interest will be added to the principal (original amount) of your loan at the time of repayment. To estimate monthly loan payments, use this online loan calculator.

Accept Your Loans

You must accept the loan(s) at MyBSU to indicate the type of loan and amount you wish to borrow: subsidized and/or unsubsidized. Subsequent loan requests may require submission of a paper form. It is possible to have both a subsidized and an unsubsidized loan at the same time. You must be enrolled for at least six credit hours undergraduate or five credit hours graduate.

The interest rate for Direct Stafford Loans first disbursed on or after July 1, 2020 and before July 1, 2021 are:

  • for undergraduate students – 2.75 percent
  • for graduate or professional students – 4.30 percent
All interest rates shown are fixed rates for the life of the loan.  Interest rates on federal student loans are set by Congress.

Most federal student loans have loan fees that are a percentage of the total loan amount.  The loan fee is deducted proportionately from each loan disbursement you receive.  This means the money you receive will be less than the amount you actually borrow.  You are responsible for repaying the entire amount you borrowed and not just the amount you received.  

  • 1.059 percent loan fee for loans with a first disbursement on or after Oct. 1, 2019 and before Oct. 1, 2020 will be deducted from each loan disbursement.

Loan limits for undergraduate students vary depending on your class level and your dependency status as determined by the information provided on your FAFSA.

  • freshmen – 29 credit hours or fewer
  • sophomores – 30 to 59 credit hours
  • juniors – 60 to 89 credit hours
  • seniors – 90 credit hours or more

Annual Limits for Dependent Students

  • $5,500 for a freshman (no more than $3,500 of this amount can be in subsidized loans)
  • $6,500 for a sophomore (no more than $4,500 of this amount can be in subsidized loans)
  • $7,500 for a junior or senior (no more than $5,500 of this amount can be in subsidized loans)

Annual Limits for Independent Undergraduate Students

  • $9,500 for a freshman (no more than $3,500 of this amount may be in subsidized loans)
  • $10,500 for a sophomore (no more than $4,500 of this amount may be in subsidized loans)
  • $12,500 for a junior or senior (no more than $5,500 of this amount may be in subsidized loans)

Annual Limit for Graduate or Post-Baccalaureate Students

  • $20,500 unsubsidized for graduate students. Students seeking a second undergraduate degree may borrow only at the undergraduate level.
  • $12,500 ($7,000 must be unsubsidized loans) is the borrowing limit for students seeking instructional licensure

Total Loan Debt

The total Federal Stafford Loan debt you can acquire is:
  • $31,000 as a dependent undergraduate student; no more than $23,000 of this amount may be in subsidized loans
  • $57,500 as an independent undergraduate student; no more than $23,000 of this amount may be in subsidized loans
  • $138,500 as a graduate student (this includes undergraduate loans)

Loan proceeds will be credited directly to your eBill account. Tuition and room-and-board charges will be paid.

If the amount of your loan is greater than the amount of these charges or if these charges have already been paid, a refund will be issued to you.

Federal regulations require that first-time borrowers complete a Master Promissory Note (MPN) at studentaid.gov. Use your PIN to login, then click on Fill Out Your Electronic Master Promissory Note.  Loan proceeds will not be disbursed until the MPN has been completed.

If you are a first-time borrower, you must complete an online loan counseling session at studentaid.gov.  Click on Take Loan Entrance Counseling and follow the directions through the entire site.  Loan proceeds will not be disbursed until the loan counseling requirement has been met.

Also, if you graduate, drop below half-time, or withdraw from Ball State, you are required to complete an online exit interview at studentaid.gov.

During this session you will receive general information on expected monthly repayments, repayment options, and debt management planning to facilitate repayment.

Repayment of your Federal Direct Stafford loan(s) begins six months after you cease to be enrolled at least half-time. Minimum monthly payments are $40.

You have seven repayment plans to select from:

  • standard (10 years) 
  • extended (not to exceed 25 years)
  • graduated (not to exceed 10 years)
  • income-contingent
  • income-based
  • income-sensitive
  • pay as you earn

Graduate PLUS loans are from the U.S. Department of Education for students seeking master’s, doctoral, or specialist degrees. The Graduate PLUS enables graduate students to borrow up to the cost of education minus any other financial aid.

To qualify for one of these loans, you must:

  • be accepted for enrollment in a degree-seeking program (MA, Ed. D, Ed. S, Ph. D) 
  • be registered at least half-time in courses counting toward a graduate or professional degree
  • file a Free Application for Federal Student Aid (FAFSA)
  • first apply for the maximum loan eligibility under the Federal Unsubsidized Stafford Loan Program
  • not be in default on any type of student loan
  • not owe a repayment on a student grant
  • pass a credit check by the U.S. Department of Education.

You can choose to apply for a Federal Direct Graduate PLUS loan by submitting a loan request form online at studentaid.gov. Students must have a good credit history and pass a credit check performed by the U.S Department of Education to be eligible for this loan.

The interest rate for Graduate PLUS loans first disbursed on or after July 1, 2020, and before July 1, 2021 is 5.30 percent.

All interest rates shown are fixed rates for the life of the loan.  Interest rates on federal student loans are set by Congress.

Most federal student loans have loan fees that are a percentage of the total loan amount.  The loan fee is deducted proportionately from each loan disbursement you receive.  This means the money you receive will be less than the amount you actually borrow.  You are responsible for repaying the entire amount you borrowed and not just the amount you received.

  • A 4.236 percent loan fee will be deducted proportionately each time a loan disbursement is made for loans first disbursed on or after Oct. 1, 2019 and before Oct 1, 2020.

Loan proceeds will be credited directly to your eBill. Tuition, fees, and room and board will be paid.

If the amount of your loan is greater than the amount of these charges or if these charges have already been paid, you will receive a refund.

Federal regulations require that first-time Graduate PLUS borrowers complete a Master Promissory Note at studentaid.gov before receiving any money from the Federal Direct Loan Program. If you have borrowed previously but are a new borrower with the Graduate PLUS Program, you must complete an MPN.

All first-time Graduate PLUS borrowers must complete an online loan counseling session at studentaid.gov. Loan proceeds will not be disbursed until the loan counseling requirement has been met.

Repayment of a Federal Direct Graduate PLUS loan begins within 60 days of the final disbursement of the loan.

You may be eligible for an in-school deferment if you continue to be enrolled at least half-time.

A Federal Direct Parent PLUS Loan is a non-need-based source of loan funds to assist parents of dependent students.

You can choose to apply for a Federal Direct Parent PLUS loan by submitting a loan request form at studentaid.gov.

Parents must have a good credit history and pass a credit check performed by the U.S Department of Education to be eligible for this loan.

The interest rate for PLUS loans first disbursed on or after July 1, 2020, and before July 1, 2021 is 5.30 percent.

All interest rates shown are fixed rates for the life of the loan.  Interest rates on federal student loans are set by Congress.

Most federal student loans have loan fees that are a percentage of the total loan amount.  The loan fee is deducted proportionately from each loan disbursement you receive.  This means the money you receive will be less than the amount you actually borrow.  You are responsible for repaying the entire amount you borrowed and not just the amount you received.

  • A 4.236 percent loan fee will be deducted proportionately each time a loan disbursement is made for loans first disbursed on or after Oct. 1, 2019 and before Oct 1, 2020.

Your parents may borrow an amount up to the maximum cost of attendance, minus all other financial assistance.

Federal regulations allow both of your parents to apply for separate PLUS loans.

Federal regulations require that first-time borrowers complete a Master Promissory Note (MPN) at studentaid.gov before receiving any money from the Federal Direct Loan Program.

Loan proceeds will be credited directly to your eBill. Tuition, fees, room and board, and any other authorized charges will be paid.

If the amount of your loan is greater than the amount of these charges or if these charges have already been paid, parents will have the option of allowing the remaining money to be refunded to the student or parent.

Repayment of a Federal Direct Parent PLUS loan begins within 60 days of the final disbursement.

Federal provisions permit the borrower to combine all Title IV loans into one repayment program. Federal Perkins Loan, Federal Direct Stafford Loans (subsidized/unsubsidized), and Federal Family Educational Loans (subsidized/unsubsidized), may be consolidated.

Federal Direct Parent Loan for Undergraduate Students may be consolidated as a separate loan, but not with the student loans. The maximum repayment period is 30 years, and loan holders are required to offer both flexible and graduated repayment plans.

Minimum monthly payments are

  • $40 for Perkins Loans
  • $40 for Stafford Loans
  • $50 for PLUS Loans

The holder of your loan will tell you what your specific loan repayment schedule will be.

Learn more about loan consolidation.

Private loans, sometimes called alternative loans, are available from private lenders and offer additional financial assistance. A credit check is required for private loans, and some of the loan terms and conditions may be based upon your credit standing. If you are a student, be aware that most lenders will require a co-signer.

Please carefully review your need to borrow. We recommend that you exhaust all federal grant and loan programs before you consider a private loan.

The Office of Financial Aid and Scholarships will process a private loan from any lender. The lender does not have to be a lender listed in the links below.  Our goal is to provide students with an array of lenders whom we have confidence in based on their terms and service capabilities. Ball State University has no affiliation with any private lenders, and financial aid employees abide by an established Code of Conduct.

Loan Terms

  • Unlike federal loans, private lenders set the terms for the loans, which can mean they have different criteria for both loan eligibility and loan rates. Before you decide to apply for a private student loan, we encourage you to research all of your options and keep a few things in mind.
  • Private student loans have a range of interest rates, fees, and repayment options.
  • We strongly encourage you to apply with a credit-worthy co-signer to both increase your chances of being approved for the loan and to obtain a better interest rate.
  • Interest rates can be either fixed or variable. Variable rates can increase or decrease over time, depending on market conditions. Interest rates on private loans may depend on your and/or your co-signer’s credit rating.
  • Before accepting any private student loan, you should determine the interest rate and any fees associated with the loan.
  • Borrowers who choose different private loan lenders to fund their post-secondary education will likely have multiple student loan payments to make upon leaving school. It can be advantageous and economical to consider using the same lender for all of your private education loan needs.
  • Initially apply to multiple lenders. Student loans are provided special protections under the credit reporting rules. As long as students conduct their ‘shopping’ within a 30-day period, there should be no impact on their credit rating and no impact on their loan terms.

Questions?

If you have general questions about private loans you may certainly contact our office. However, please remember that we cannot offer assistance on your choosing of a lender or product. Each family’s circumstances are unique, and the loan terms and benefits offered to you may be dependent upon your specific credit standing.

Due to requirements in the Truth in Lending Act, a lender must obtain a self-certification signed by the applicant before disbursing a private education loan. If you have not provided a signed copy of the applicant self-certification form to your lender download the form.

Comparison Tools

Two tools are provided below for your use. Each allows you to compare lenders. These are not comprehensive listings of lenders, and you can use any lender of your choosing. These are provided to assist you in the process. 

ELMSelect LENDER CHOICES

ELMSelect is a tool that allows you to compare rates of lenders. The following lenders were selected based on their terms and service capabilities.

Click on ELMSelect  to begin the process.

INVESTED MARKETPLACE LENDER CHOICES

Instantly and accurately compare rates and terms from multiple private loan lenders side-by-side.

Click on INvestEd Marketplace to begin the process.

Private Student Loans Policy

Ball State recommends that families apply for need-based financial aid and/or federal loans by annually completing the FAFSA. We recommend that students exhaust their federal loans first because they may have lower, fixed interest rates and more flexible repayment options. Federal student loans also offer deferment options, forgiveness programs, and income-based repayment plans that may not be available from all private lenders.

The Office of Financial Aid and Scholarships will certify a private loan from any lender selected by the student.

Ball State has provided two comparison tools—ELM Select and INvested Marketplace—to consider when choosing private financing options.

Lenders for ELM Select were identified based on total loan volume with Ball State, affiliation with Education Loan Management (ELM), ability to disburse funds via electronic funds transfer (EFT), and consistent, timely and accurate customer service to both Ball State staff and students. A lender may be dropped from ELM Select if the above conditions are not maintained, if unethical or deceptive practices are perceived, or if origination, processing or servicing concerns arise that cannot be resolved satisfactorily. Ball State reserves the right to maintain and alter ELM Select at any time and to select lenders that consistently provide competitive products, along with responsible actions and policies that best serve our students.

INvested Marketplace is managed by INvested. The lender decisioning process is completely powered by an outside entity, currently Purefy. Lenders are required to provide actual rates and terms.