What you need to know
In addition to need-based financial aid awards, scholarships, and work-study, loans are another way to finance your college education.
Before you apply for any loans, it is important to understand the types of loans available, the eligibility requirements for each, and the terms and conditions for receiving the funds. It is also critical to understand the repayment process and what you will need to do once you graduate or leave college before completing your degree.
What is FAFSA, and why is it so important?
FAFSA stands for Free Application for Federal Student Aid, and it is how colleges and universities ensure fairness and consistency in determining a student's Student Aid Index (SAI) and how much financial aid support you may receive from PennWest. After the University receives the assessment of your FAFSA application, we will review and notify you of your PennWest financial aid package.
Learn more about completing the FAFSA
Type of Loans
Federal Loans
The U.S. Department of Education (ED) offers two main types of loans, subsidized and unsubsidized, to help eligible students cover the cost of higher education. The amount and type of Federal Direct Loan eligibility is determined by information from the FAFSA.
Federal Direct Subsidized Loans
Federal Direct Subsidized Loans are made available to eligible undergraduate students who complete a FAFSA and demonstrate financial need. The interest on this loan is subsidized (paid for) by the Federal Government while the student is in school at least half-time status and for the first six months after the student graduates or ceases attendance.
Federal Direct Unsubsidized Loans
Federal Direct Unsubsidized Loans are loans made available to undergraduate, graduate, and professional students who complete a FAFSA. The loan’s interest is not subsidized (not paid for) by the Federal Government and will accrue interest while the student is enrolled. The interest that accrues will be capitalized (added to the loan balance) when the student is no longer enrolled. Whenever possible, pay interest on your loans while you’re in school to avoid capitalization of any unpaid interest.
Federal Direct Plus Loans
PLUS loans are federal loans that parents of dependent undergraduates, as well as graduate students, can use to help pay education expenses.
The U.S. Department of Education (ED) makes available to graduate students and parents of dependent students credit-based loans to cover any financial gaps up to the student’s cost of attendance left by other types of financial aid, including grants, scholarships, and other federal student loans.
Alternative and private loans
Alternative loans are student and parent loans borrowed through a bank or credit union. The University recommends prioritizing the Federal Direct Stafford Loans and Direct Parent or Graduate PLUS loans and payment plans with the Student Accounts Office before choosing to take out an alternative loan.
Please be sure to shop around at the different banks and credit unions to choose one that works for your family before applying for a private loan. Carefully review your expenses and financial aid package before calculating your additional needs.
PennWest does not have a preferred lender list. However, to assist you in your search, PennWest utilizes ElmSelect, a transparent, lender-neutral, free service, to assist students in researching and comparing private lenders our students have borrowed from in the past three years. Lenders are listed in alphabetical order and are in no way ranked by the University.
What is loan forgiveness?
PennWest graduates in the teaching profession as well as other government or nonprofit industries, may qualify for a portion or all of their student loan debt to be canceled based on certain conditions: agency, years of service, and personal income thresholds, to name a few. There are numerous variables related to loan forgiveness, each involving a specific application process.