The Federal Loan Program allows students to borrow money at a low interest rate for educational expenses. While loans can be a good investment in a student's future, taking out a federal loan is a serious obligation. The full amount borrowed must be paid back with interest. There are two types of loans:
Subsidized – need based loan, which means the amount you may be eligible to receive is based on your financial need. The federal government pays the interest that accrues on a loan:
- while you are in school,
- during your grace period after you leave school or graduate, and
- during eligible deferment periods.
Unsubsidized – non-need based loan, which means the amount you may be eligible to receive is not based on your financial need. If you receive an unsubsidized Direct Loan, you will be responsible for all interest that accrues on the loan from the date of disbursement forward.
Loan Eligibility Requirements
- Must complete the Free Application for Federal Student Aid (FAFSA);
- Must be a U.S. Citizen or an eligible non-citizen;
- Must be accepted for enrollment and enrolled at least half-time at a participating school in an eligible program leading to a diploma or degree;
- Must maintain Satisfactory Academic Progress (SAP) in your program of study according to your school's standards and statutory requirements;
- Must not be in default on an educational loan or owe a refund on an educational grant;
- Must have a high school diploma or equivalent (GED);
- Must meet all other Federal Direct Loan program eligibility requirements prescribed by law at the time your loan application is processed.
At CGTC, students will not be initially packaged with a loan. Students that have not previously had a student loan with CGTC must attend a loan counseling session in order to receive a Student Loan Packet (SLP). Students need to contact the Financial Aid Office for loan session schedules at the campus locations. Continuing students that have had a previous student loan through CGTC must submit a new Loan Amount Request form and a new Contact Sheet each year for loan processing. Students with enrollment in all on-line courses or students that do not live in the vicinity of a campus need to contact the Financial Aid Office for further instructions to receive counseling and a loan packet. The SLP contains instructions on how to complete online entrance counseling and the online Master Promissory Note (MPN). The SLP also contains important information about the Federal Loan Program along with the Federal Direct Student Loan Request Form (this form must be submitted to the Financial Aid Office in person or by postal mail; faxes or emails will not be accepted). Students must complete entrance counseling, the MPN, and submit the loan request form before the Financial Aid Office will process the loan. It is the student's responsibility to read and understand the information provided in the SLP.
Once the Loan Request Form is received, it will be checked for completeness. Incomplete forms will be denied and returned to the student.
The student should allow two to three weeks for the loan to be processed. The first loan disbursement for any term will be after the mid-term period. Students must submit all required documentation by the loan request deadline in order for their loan to be processed in the first loan disbursement round. Loan disbursements after this time will be processed every two weeks until the end of the term in the order that the loan amount requests are received. Loans cannot be processed after the last day of each term. Please note: Disbursement means when the loan is posted to the student's account. Refunds will be processed by the Cashier within 14 days after the loan has been posted to the student's account. It is advised to submit your loan request early.
Loan Procedures When a Student Stops Attending - Withdrawal/Graduates
Schools are required to adopt exit interview practices at the end of a student's period of enrollment in the event the student graduates or drops below half-time. At CGTC, these students will receive an Exit Interview Packet which contains important information and instructions on Exit Counseling in the event the student goes into repayment after graduation or if they withdraw.
Upon withdrawal for Graduation – The Financial Aid Office will receive a report from the Registrar's office of students who have applied for graduation. The Financial Aid Office will contact these students to notify them of the Exit Interview Counseling requirement. The Exit Counseling requirement is listed as part of the graduation application process. Borrowers who do not complete the required Exit Counseling by the established deadline will be prevented from receiving their diploma or transcript until the Exit Counseling requirement is satisfied. These students will receive an Exit Interview Packet which will direct them to complete the exit counseling requirement online.
Withdrawal – Students who withdraw below half-time enrollment will receive an Exit Counseling Packet by postal mail.
The Financial Aid Office will check exit counseling reports daily and will send missing document letters periodically to students that have not completed the exit counseling requirement.