Types of Aid — Introduction

Financial aid is awarded in three categories—grants, scholarships, and loans—and comes from two main sources—the Federal government and private donors. By utilizing a combination of several types of aid originating from various sources, the Financial Aid Services Office is enabled to award students with a "package" of aid.

Federal Aid

Federal Aid is available to all students, whether they are an incoming Freshmen or Transfer student. To be eligible for Federal Aid, you must be a U.S. citizen, or eligible non-citizen. To apply for Federal Aid, you must submit a Free Application for Federal Student Aid (FAFSA).

Up to 3% of the total amount of the Federal Subsidized Stafford Loan, Unsubsidized Stafford Loan, and PLUS Loan mentioned below may be deducted by the bank or guarantee agency. In addition, if a student graduates or ceases to attend half time, they are required to complete an exit loan counseling session for their Federal Subsidized Stafford Loan, Unsubsidized Stafford Loan, and/or Federal Perkins Loan.

Federal Pell Grant

Eligibility: Financial need as determined by the Free Application for Federal Student Aid.

Amount: For the 2009 – 2010 academic year, the amount ranges from $400 – $5,350.

Renewal: Must re-apply for financial aid and maintain satisfactory academic progress.

The Federal Pell Grant is available to students who attend at least part time (six credits). In certain situations, however, a student who is enrolled for less than six credits may be eligible for a Pell Grant.

Federal Supplemental Educational Opportunity Grant (FSEOG)

Eligibility: Financial need as determined by the Free Application for Federal Student Aid. Priority is given to Federal Pell Grant recipients.

Amount: Amount varies each year based upon school allocation.

Renewal: Must re-apply for financial aid and maintain satisfactory academic progress.

Federal Subsidized Stafford Loan

Eligibility: Financial need as determined by the Free Application for Federal Student Aid.
Amount: Amounts are based upon the number of cumulative credits a student has earned. The following chart lists the requirements:

Class	Credits	Amount
Freshmen	00 – 29	$3,500/year
Sophomore	30 – 59	$4,500/year
Junior	60 – 89	$5,500/year
Senior	90+	$5,500/year

Renewal: Must re-apply for financial aid and maintain satisfactory academic progress.
Terms: Payment of principal and interest accrual begins six months after the student ceases to be enrolled at least halftime; interest is deferred while the student is enrolled at least halftime; interest rate is 5.6%; loan fees are charged according to Federal laws (maximum is 3%)

If you wish to participate in the Federal Stafford Loan Program, please complete a Loan Request Form and return it to the Financial Aid Services Office. In addition, first-time borrowers at Northwest University must complete the entrance counseling online that will explain issues and rights and responsibilities. An official Loan Application can be completed by the student via www.edfund.org. Students who have already completed the required application (Master Promissory Note) will only need to complete the Loan Request Form. Federal Stafford loan funds are sent to the college from the lenders by Electronic Funds Transfer (EFT). EFT funds will be credited directly to the student’s account. The student borrower must sign any loan funds sent by check.

Federal Unsubsidized Stafford Loan

Eligibility: Not need-based
Amount: The amounts are the same as the Federal Subsidized Loan, plus an additional $2,000/year. Additional amounts are available for independent students and dependent students whose parents are denied the PLUS loan:

Freshmen/Sophomore – $4,000
Junior/Senior – $5,000

Renewal: Must re-apply for financial aid and maintain satisfactory academic progress.

Terms: Eligibility based on independent status or dependent student who is not eligible for a Federal Subsidized Loan. Borrowers are responsible for the interest while they are enrolled and during repayment period. Interest payments can be deferred while student is in school and during their grace period. Interest rate is 6.8%. Payment of principal and interest begins six months after the student ceases to be enrolled at least half-time. Interest rates, loan fees, application, and disbursement process are the same as for the Federal Subsidized Stafford Loan.

Federal Parent Loan (PLUS)

Eligibility: Must be a parent of an enrolled student and have an acceptable credit rating.

Amount: The maximum amount is the student's estimated budget minus financial aid.

Renewal: Application required annually.

Terms: Check is made co-payable to the borrower and school. Interest rate is 8.5%. Repayment of principle and interest begins 60 days after the last disbursement. Loan fees, application, and disbursement process is the same as for the Federal Subsidized Stafford Loan.

To apply for a PLUS loan, one parent must complete the PLUS Loan Request Form and return it to the Financial Aid Services Office. A bank application can be accessed on each lender’s website.

REMEMBER – up to 3% of the total amount of the Federal Subsidized Stafford Loan, Unsubsidized Stafford Loan, and PLUS Loan may be deducted as a guarantee fee and origination fee.