Available Loans
There are a variety of options for paying for school depending on your financial aid eligibility.
The Federal Government pays your loan interest while you are in school. Eligibility based on financial need.
You pay all the interest on your loan, although you can defer your payments until after graduation.
The Federal Government pays your loan interest while you are in school. Eligibility based on financial need.
You pay all the interest on your loan, although you can defer your payments until after graduation.
Enables parents to borrow to pay for their children's education.
The best loan available if you qualify for it. The school acts as the lender, and the Federal Government pays your loan interest while you are in school. No origination or default fees.
A non-federal unsecured loan whose interest rates and orignination fees, as well as repayment, forbearance and deferment options vary based on the lending institution.
Additional Resources
Federal Direct Loans
To receive a loan from the William D. Ford Direct Loan Program, you must complete the Direct Stafford Loan Request Form (PDF 106.KB) Federal Stafford Loans
To receive a Stafford loan, you must complete the Stafford Loan Request Form (PDF - 112.67KB) and choose your lender:
- You may choose a lender listed on the form.
- You may choose a lender of your choice. You must supply the name, address and lender code on the processing form.
For more detailed information, please contact a financial aid representative.
First-time borrowers at Montgomery College must complete an entrance interview before submitting a Loan Processing Form. In addition, you are required to attend a loan information session.
Entrance interviews for loan borrowers new to MC must be completed in person. See the flyer for the schedule for the next Stafford Loan Counseling Sessions. (PDF - 264 KB). If you cannot attend an in person session you may complete an electronic loan session by visiting the Direct Loan site and following the link.
- Loans are available to students with financial need not covered by grants and scholarships.
- Students may apply for loans only after they have been reviewed for grant eligibility.
- The interest rate for subsidized Stafford loans is fixed at 5.6% effective July 1, 2009.
- Accumulated interest while you are in school or while your loan is in deferment is paid by the Federal Government.
- Interest payments begin on this loan when you enter repayment six (6) months after you graduate or drop below half time enrollment.
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- Interest rate for 2009 - 2010 is fixed at a 6.8%.
- Loans prior to July 1, 2006, have a variable interest rate.
- You may pay the accumulated interest on unsubsidized loans or it will capitalize.
- Interest may be paid while your loan is in deferment or once you begin repayment.
Annual Borrowing Limits For Dependent Students
Effective 7/01/09
| Grade Level |
*Subsidized (Sub) Maximum |
**Unsubsidized (Unsub) Maximum |
Combined Sub & Unsub Maximum |
| Freshman |
$3,500 |
$2,000 |
$5,500 |
| Sophomore |
$4,500 |
$2,000 |
$6,500 |
*The Subsidized Stafford Loan for 2009 - 2010 is fixed at a 5.6% interest rate for new borrowers.
**The Unsubsidized Stafford Loan for 2009 - 2010 is fixed at a 6.8% interest rate for new borrowers.
Annual Borrowing Limits For Independent Students
Effective 7/01/09
| Grade Level |
*Subsidized (Sub) Maximum |
**Unsubsidized (Unsub) Maximum |
Combined Sub & Unsub Maximum |
| Freshman |
$3,500 |
$6,000 |
$9,500 |
| Sophomore |
$4,500 |
$6,000 |
$10,500 |
*The Subsidized Stafford Loan for 2009 - 2010 is fixed at a 5.6% interest rate for new borrowers.
**The Unsubsidized Stafford Loan for 2009 - 2010 is fixed at a 6.8% interest rate for new borrowers.
Aggregate (Lifetime) Borrowing Limits
Effective 7/01/09
| Student Type |
*Subsidized (Sub) Maximum |
Combined Sub & Unsub Maximum |
| Dependent Undergraduates |
$23,000 |
$31,000 |
| Independent Undergraduates |
$23,000 |
$57,000 |
*The Subsidized Stafford Loan for 2009 - 2010 is fixed at a 5.6% interest rate for new borrowers.
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Parent Plus Loans
To apply for a PLUS loan, a Free Application for Federal Student Aid (FAFSA) must be on file. This loan is available to parents of dependent students to borrow on behalf of their child. Contact the lenders who work with Montgomery College for a comparison of their services.
A Plus Loan Request Form is required by Montgomery College. Forms are available from any MC campus financial aid office beginning in July of each academic year. The interest rate for PLUS loans is fixed at 8.5% effective July 1, 2006. Loans prior to this date are at a variable interest rate.
This loan is based on credit-worthiness and the parent starts repayment 60 days after the full disbursement of the loan. The parent may borrow up to the student's cost of education, excluding awarded financial aid.
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A Federal Perkins Loan is a low-interest (5%) loan for students with exceptional financial need. The loans are made by Montgomery College with funds that are distributed by the Federal government. You must demonstrate financial need and be registered for at least half-time enrollment to receive this loan.
You will not be charged a fee to borrow this loan, and you do not have to pay it back until nine months after you graduate or drop below half-time enrollment.
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Private Loans are based on the borrower's credit history; some lenders require a cosigner. Students/Parents may borrow up to the student's yearly Cost of Attendance minus any other financial aid the student is receiving, including other student and parent loans.
A private loan usually costs more than the federal loans, and the expenses you pay may vary widely between different lender’s programs. Do not forget to log in to your MYMC portal to get your cost of attendance and other necessary information to complete the self-certification form to submit to your private loan lender.
Is a Private Loan a wise decision for you? Think carefully before going deeply into debt. There may be other opportunities for you. You can discuss these options and your specific situation with one of our financial aid representatives. There is also a discussion available at Finaid.org
For education loans, you almost always receive better loan conditions and lower rates with a Federal Perkins, Subsidized Stafford, Unsubsidized Stafford, or PLUS loan. Before proceeding with a private loan, check your eligibility for these options first.
When do families consider a private Loan?
- If you or your parents do not meet Federal Eligibility Requirements
- If you have received all the aid you are eligible for, including Federal loans, and still have additional cost
- If you have outstanding charges and it is too late to obtain Federal aid for a previous period of enrollment
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Repayment
Loan funds are generally repaid after attending college. Interest rates for educational loans may be lower than commercial interest rates. There are special loans for parents and independent students who are not eligible for grants.
When you accept the money from the loan, you are agreeing to repay the loan. If you fail to repay the loan under the terms of the promissory note, you will have defaulted on your loan. Defaulting on your student loan could damage your credit rating for a very long time.
The SFA Ombudsman works with student loan borrowers to informally resolve loan disputes and problems with federal loans. For more information regarding the Ombudsman visit www.ombudsman.ed.gov or call 877- 557-2575.
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MC TIP (MC Tuition Installment Plan)
Before applying for an alternative loan, you might also want to investigate MC Tuition Installment Plan (MC TIP). You can view and enroll for MC TIP from inside MC Bill Payment by logging into MyMC and going to Pay My Balance/View My Bill.
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