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Federal Direct Stafford Loan Program - Subsidized and Unsubsidized
Luzerne County Community College offers the Federal Direct Loan Program

The Federal Direct Subsidized Stafford loan is a need-based loan. The federal government will pay students' interest payments while they are enrolled in school, if they are eligible for a subsidized Stafford loan. The student must be enrolled at least half-time in a certificate or associate degree program. The interest rate for the Federal Direct Subsidized Stafford loan is fixed at 3.4% for loans first disbursed on or after July 1, 2012 and before July 1, 2013. The interest rate for the Federal Direct Unsubsidized Stafford Loan is a fixed 6.8% for loans first disbursed after July 1, 2012. A student who has outstanding indebtedness will borrow at the rate of their previous loan. When you graduate, drop below half time, or withdraw from your academic program, you will receive a six-month grace period for your Direct Subsidized and Unsubsidized Loans. Your grace period begins the day after you stop attending school on at least a half-time basis. Once your grace period ends, you must begin repaying your loan(s). Minimum payments are $50 per month. The maximum that freshmen can borrow (those students with less than 30 credits completed), is $3,500 for subsidized and $2,000 for unsubsidized per the academic year. Those students with 30 credits or more can borrow a maximum of $4,500 for subsidized and $2,000 for unsubsidized per academic year. By law, all loans, regardless of the loan term dates must have multiple disbursements. The student will receive one half of the loan in the fall semester and the second half in the spring semester. The loans will be disbursed on or about the 30th day of the semester. The student has the right to cancel any or all of their Stafford loan proceeds within 14 days of receipt of the disbursement. There are origination fees and interest rebates on Federal Direct Subsidized and Unsubsidized Stafford Loans they are as follows: For loans first disbursed on or after July 1, 2012 and before July 1, 2013 origination fee of 1.0%. The origination fees are charged to offset the cost of defaulted Stafford loans. The unsubsidized Stafford loan requires the student to make quarterly interest payments. If you choose, the interest may be capitalized. The government will then apply the interest to the principal, which will increase your principal upon repayment.

Federal Direct Stafford Loan Student Borrowers
If your award letter quotes a Federal Direct subsidized or unsubsidized Stafford loan, you must complete the Federal Direct Stafford Master Promissory Note (eMPN) in order to receive these loan funds and have an completed Loan Entrance Counseling on file (refer to instructions below).

How to Apply for the Federal Direct Stafford Loan:

  1. A Free Application for the Federal Student Aid (FAFSA) PIN# (Personal Identification Number) to complete this process. If you have lost your pin, or do not have a PIN, you may reset or obtain a new PIN at www.pin.ed.gov.
  2. For the Federal Direct Stafford Loan electronic Master Promissory Note (eMPN), you will be asked to provide the names, address and telephone numbers of two references with different U.S. addresses who have known you for at least three years. The first references should be a parent or legal guardian.
  3. Each requirement will take approximately 15-20 minutes to complete. CAUTION: Make sure you allow enough time to complete the entire process in a single session since you will not be able to save the information.
  4. Read and complete all items and list Luzerne County Community College as your school choice
  5. Visit the Department of Education eMPN site:
    Click HERE to apply.

How to complete the Entrance Counseling (first-time borrowers):

  1. Read and complete all items and list Luzerne County Community College as your school choice.
  2. Visit the Department of Education Loan Counseling site: click HERE to complete.



Federal Direct PLUS Loan

The Federal Direct PLUS Loan is a low-interest* 7.9 % education loan for parents of undergraduate, dependent students. The Federal Direct PLUS Loan has a 4.0% origination fee. With a PLUS loan, you can fund the entire cost of the student's education (less student financial aid). Repayment of interest and principal usually begins 60 days after disbursement. PLUS loan proceeds are made in two disbursements for an academic year and are sent directly to the school. Luzerne County Students must first complete the Free Application for Federal Student Aid (FAFSA) and the Luzerne County Community College Financial Aid Application prior to the PLUS loan being certified.

How to Apply for the Federal Direct PLUS Loan:

  1. A Free Application for the Federal Student Aid (FAFSA) PIN# (Personal Identification Number) to complete this process. If you have lost your pin, or do not have a PIN, you may reset or obtain a new PIN at www.pin.ed.gov.
  2. For the Federal Direct PLUS Loan electronic Master Promissory Note (eMPN), you will be asked to provide the names, address and telephone numbers of two references with different U.S. addresses who have known you for at least three years and the amount you request to borrow.
  3. This eMPN will take approximately 15-20 minutes to complete. CAUTION: Make sure you allow enough time to complete the entire process in a single session since you will not be able to save the information:
    If your loan application is not approved, you will be contacted by the Federal Servicer (in writing) and given the option of appealing the credit decision or resubmitting the application with a credit-worthy endorser. Questions concerning your credit decision should be directed to the Federal Servicer’s Applicant Service at 1-800-557-7394. Each subsequent year the parent of the dependent Undergraduate students will need to go through a credit check and request the annual loan amount.
  4. Federal Direct PLUS Loan Master Promissory Note: The PLUS loan MPN allows parents of dependent Undergraduate students to borrow for multiple years (up to 10 years) under one note provided you do not require an endorser.
    Note: Beginning in the 2012-2013 Academic year the loan cannot be applied for more than 90 days before the start of the academic year.
  5. To complete the Federal Direct PLUS Loan eMPN:

  6. Visit the Department of Education eMPN site: click HERE to apply.
  7. Read and complete all items and list Luzerne County Community College as your school choice.