The new Health Care and Education Reconciliation Act of 2010 requires all schools to process federal loans through the Direct Loan Program.

Suffolk University Law School will be participating exclusively in the Federal Direct Loan Program for the 2010/2011 academic year, beginning with Summer 2010.  Student borrowers will receive funding for their Stafford and Graduate PLUS loans directly from the U.S. Department of Education, rather than from private banks and lenders as they do now through the Federal Family Education Loan Program (FFELP).

For further information on the Direct Loan Program, refer to the Direct Lending Frequently Asked Questions.

Direct Lending Frequently Asked Questions

Suffolk University Law School will participate exclusively in the Federal Direct Loan Program for the 2010/2011 academic year, beginning with Summer 2010.   Student borrowers will receive funding for their Stafford and Graduate PLUS loans directly from the U.S. Department of Education rather than from private banks and lenders as they do now through the Federal Family Education Loan Program (FFELP).  Below is a list of questions related to the Direct Loan Program that should help students understand this program. 

What are the primary differences between the Federal Direct Loan Program and the Federal Family Education Loan Program (FFELP)?
The primary difference is the source of funding.  Federal Direct Loans come directly from the U.S. Department of Education using funds obtained from the U.S. Treasury.  In FFELP, funding is provided by private lenders. 

Are there any differences in interest rates between the two programs?
The interest rate for Federal Graduate PLUS loans is a fixed rate of 7.9% in the Direct Loan Program compared to 8.5% in FFELP.  The 6.8% fixed interest rate for Stafford Loans is the same in both programs.

How does this impact me? 
If you plan to borrow a Stafford or Graduate PLUS loan for 2010/2011, you will be borrowing through the Federal Direct Loan Program. 

What happens if I want to borrow loans for a summer program in 2010?
All loans for summer 2010 programs will be processed through the Direct Loan Program.    

Does this change affect my current year loans? 
No.  All 2009/2010 loans will be processed through the current FFELP process.

Do I have to complete another Master Promissory Note (MPN)? 
Yes.  You must sign a new Direct Loan MPN because you will be borrowing from a new lender, the U.S. Department of Education. 

Can I complete my Master Promissory Note (MPN) now? 
Yes, you may choose to complete your new Stafford Direct Loan MPN at any time, even before you have received your award letter.  You can complete and e-sign your MPN online at studentloans.gov. You will need your FAFSA PIN in order to sign your Master Promissory Note (MPN). This is the same PIN you used to sign your FAFSA.  More information on your PIN is available at pin.ed.gov. 

I plan to borrow a Graduate PLUS loan.  I usually get pre-approved through my lender.  What should I do this year? 
There are two steps that must be completed to receive a Direct Graduate PLUS Loan:  start the application process to be approved for the loan and e-sign the Direct Graduate PLUS Master Promissory Note (MPN).

To complete both the application and MPN for the Direct Grad PLUS loan:

1. Go to www.studentloans.gov
2. Log-in with your FAFSA PIN
3. Select  “Start PLUS Application Process” and then “Graduate PLUS” for the loan type
4. Continue to complete the application by following the instructions
5. Select “Complete Master Promissory Note” and then “Graduate PLUS” for the loan type
6. Continue to complete and e-sign the MPN by following the instructions

Will I still be able to continue borrowing through the same lender as last year?
No.  If you borrowed a 2009/2010 Federal Stafford or Federal Graduate PLUS loan and need those loans for 2010/2011, you will be required to borrow through the Federal Direct Loan Program.

If I borrowed a Federal Stafford or Federal Graduate PLUS loan through a private lender last year, and borrow a Federal Direct Loan in the future, will I have to repay two different lenders?
Yes.  Your Federal Direct Loan will be serviced by the Department of Education and you will receive correspondence and payment information from the Department of Education.  You will also be contacted by other lenders from whom you have borrowed Federal Stafford or Federal Graduate PLUS loans.  However, you have the option of consolidating all your federal loans with the Federal Direct Loan Program after you graduate.  If you consolidate, your previous federal loans would be paid in full and you would make one payment for your new Federal Direct Loan Consolidation. 

Will payments still be deferred on the Stafford and Graduate PLUS loans I have already borrowed through my previous lender?
Yes.  You will continue to be eligible for the same in-school deferments on your prior loans as long as you are enrolled at least half-time. 

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