IUSM IU

Financial Aid Guide

— Programs Administered by IUPUI-OFSAS —

Study Group

Direct Loans Programs (DL)

The following information summarizes the terms for the Direct Loans Federal Stafford Loan Program (Subsidized and Unsubsidized) and the Direct Loan Federal Graduate PLUS Loan. Direct Loans are with the U.S. Department of Education.

DL Federal Subsidized Stafford Loan Program

The DL Federal Subsidized Stafford Loan Program at IUPUI is obtained through Direct Loans through the Federal Government. Eligibility is based on the student's calculated financial need. Financial need is the result of the Cost of Attendance (COA) minus the student's calculated Student Contribution (SC) from the Free Application for Federal Student Aid (FAFSA).

Graduate and professional students may borrow up to $8,500 through Federal Subsidized Stafford Loan annually or every academic year, up to a maximum aggregate of $65,500. Over the four years at IUSM, a student is capable of borrowing $34,000 ($8,500 four times over four years). Some students may have borrowed as an undergraduate or graduate student prior to medical school that may limit the student's borrowing through this program. This is assuming they are at or near the $65,500 maximum aggregate prior to borrowing through this program in medical school.

Interest Rates Beginning July 1, 2006, the interest rate for new borrowers under the Federal Subsidized Stafford Loan Program is 6.8% fixed. This is for the life of the loan until it is repaid. DL Federal Stafford Loan repayment begins six months after graduation or when the student withdraws or ceases to attend school. Deferment options may extend this non-repayment period further, if a student qualifies. Non-payment extensions includes the Internship/Residency Forbearance.

The federal government pays the interest accrual during the student's in-school status and during any applicable grace periods. Principal and interest are billed monthly when repayment begins (generally after residency). The number of repayment months is determined by the total amount borrowed, not to exceed 120 months or 10 years on a standard repayment schedule. Consolidation is available for students who wish a longer time period to repay (see Loan Consolidation). There is no prepayment penalty at any time. Loans are forgiven in the event of death or total permanent disability.

Deferments: Deferments on repayment of principal and interest on Federal Subsidized Stafford Loans are granted for unlimited periods if the student is enrolled in full-time or part-time study. Deferments mean that the student is eligible to postpone making any required payments for specified periods of time. The federal government pays the interest during the applicable deferment periods. In-school deferments are issued upon request when the student completes an in-school deferment form issued by the lender or the servicing agency. The school authorizes the in-school status of the student by completing a portion of the deferment form and forwarding it to the loan servicer. Some school exchange enrollment data in lieu of a paper deferment form. IUPUI exchanges enrollment data through the Student Loan Clearinghouse. This is done at the beginning of each enrollment period or semester.

Common Financial Aid Sources and Their Annual Maximums

Program Terms 1st yr 2nd yr 3rd yr 4th yr TOTAL
DL Subsidized Federal Stafford Loan Program 6.8% Fixed Interest Rate (6 month grace period after graduation before repayment begins) $8,500 $8,500 $8,500 $8,500 $34,000
DL Unsubsidized Federal Stafford Loan Program 6.8% Fixed Interest Rate (6 month grace period after graduation before repayment begins) $32,000 $32,000 $38,667 $38,667 $141,334
Federal Primary Care Loan* 5% Interest Rate Residency Deferment, Primary Care Commitment N/A³ N/A³ Up to Budget minus
parent/student contributions		 Up to budget minus
parent/student contributions		 Prefernce given the final two years of medical school.
Loans to Disadvantaged Students* 5% Interest Rate Residency Deferment Depends on Federal Funding Varies Varies Varies Varies Varies
School of Medicine Scholarships*/ Loans* Based on need, academics or a combination of both. Geographic restrictions may apply. $2,000 - 5,000 $2,000 - 5,000

$2,000
- 5,000

 $2,000
- 5,000 		$8,000
- 20,000
* Review of parental information is required. ¹Loan period May through December which encompasses summer and fall terms ³The Federal Primary Care Loan is awarded to third and fourth-year medical students with demonstrated financial need. Financial need is figured using parental information submitted on the FAFSA.

DL Federal Unsubsidized Stafford Loan Program

The DL Federal Unsubsidized Stafford Loan is available to medical students in addition to the DL Federal Subsidized Stafford Loan. Students who qualify for the maximum amount of $8,500 through the DL Federal Subsidized Stafford Loan may borrow annually up to an additional $12,000 through the DL Federal Unsubsidized Stafford Loan Program. This makes it possible for the students to initially apply for and receive up to $20,500 in combination of DL Federal Subsidized and Unsubsidized Federal Stafford Loans. Students who do not qualify for the DL Federal Subsidized Stafford Loan may still borrow up to $20,500 by replacing the subsidized with unsubsidized loan. Additionally, medical students can borrow the DL Additional Federal Unsubsidized Stafford Loan of up to $20,000. This amount together with the $20,500 through the DL Federal Subsidized and Unsubsidized Stafford Loan gives a medical student a total of $40,500 annually they can borrow. The Cost of Attendance (COA) limits the student's borrowing to the standard or adjusted COA. The terms of the DL Federal Unsubsidized Stafford Loan are the same as the terms for DL Federal Subsidized Stafford Loans, except as described below for the DL Federal Unsubsidized Stafford Loan.

Interest Payments The federal government does not pay the interest on DL Federal Unsubsidized Stafford Loans, as it does with DL Federal Subsidized Stafford Loans. Students have the option to make payments on the interest that accrues on unsubsidized loans during the time they are enrolled in school, during the grace period, and during any periods of deferment or repayment.

Federal Origination Fee

Students are charged an origination fee of .5% on each disbursement of the DL Federal Subsidized or Unsubsidized Stafford Loans. This origination fee will be deducted from each disbursement by the federal government.

If you have any questions about applying for the DL Federal Subsidized or Unsubsidized Stafford Loans, please contact MSA-SFS at 317 274-8568 or e-mail us jespada@iupui.edu.

DL Federal Graduate PLUS Loan Program

The DL Federal Graduate PLUS Loan is a federal private loan where th interest rate is fixed at 7.9%. This loan is also through the U.S. Department of Education. The amount is based on the Cost of Attendance minus other financial aid. There is no maximum aggregate limit.

Deferments on interest and principal are handled in the same manner as the DL Federal Unsubsidized Stafford Loan Program, and for unlimited periods where the student is enrolled at least half-time. (Repayment begins six months after graduation or separation from school.) Repayment of the loan must be made within the standard repayment period of ten years. This is the case for all federal loans.


Requesting a Credit Report

The DL Federal Graduate PLUS Loan may require a credit report that details your credit history before the Feederal Government will approve funding. Instead of waiting and being surprised, you should request a copy of your credit history report before entering the private loan application process. It is common for people to receive reports that have errors or something long forgotten. Clearing up mistakes or improving your credit report could take months, so get a report early. Credit reports are free if you were denied insurance, credit or employment in the last 60 days due to bad credit: otherwise a nominal fee is charged. By law, you are eligible for one free credit report from each credit bureau. Several agencies prepare credit reports:

Federal Primary Care Loan Program

GENERAL INFORMATION

What is the Primary Care Loan Program?

The Primary Care Loan (PCL) program is a low cost federal loan program for medical students committed to primary health care practice. The interest rate is 5 percent and begins to accrue following a one year grace period after you cease to be a full-time student. When compared to other federal student loans and private loans, the PCL provides significant savings. The loan also offers deferment of principal and interest not found in other loan programs.

How much can I borrow?

Your financial aid office will determine how much you can borrow based on your eligibility, the amount of PCL funds available at your institution and other criteria. The maximum award is the cost of attendance (including tuition, educational expenses, and reasonable living expenses).

How Do I Qualify for a PCL?

Why must I provide financial information about my parents to obtain a PCL?

To assist schools in allocating limited PCL funds, Health and Human Services requires parental financial information from all students to determine financial need without regard to age, tax, marital or independent status.

Service Obligation

Is there a service requirement for PCL?

YES.

What are some examples of primary health care and non-primary care residency and practice activities for the PCL Program?

PRIMARY HEALTH CARE: ACCEPTABLE NON-PRIMARY HEALTH CARE: NON-ACCEPTABLE
Clinical Preventive Medicine Cardiology
Occupational Medicine Gastroenterology
Public Health Obstetrics/Gynecology
Public Policy Fellowship Surgery
Senior Residencies in one of the above Dermatology
Faculty administrators / policy makers certified in one of the primary health care discipline Radiology
Geriatrics Psychiatry
Adolescent Medicine Emergency Medicine
Adolescent Pediatrics
Sports Medicine

Are there exceptions to the primary health care service obligation?

YES, however, your loan repayment obligation remains.

What if I do not fulfill the primary care service obligation?

At the point you fail to fulfill your service obligation, the outstanding loan balance will be computed at an interest rate of 18 percent from the date of noncompliance, compounded annually retroactive to the first date of issuance.

What if I accept PCL and change my mind about primary health care?

If you are not firmly committed to the practice of primary health care, you should not accept a PCL.

What if I want additional certification?

You may obtain additional certification in primary health care while fulfilling your service obligation, as long as you complete your primary health care residency program within four years after graduation. For example, if your primary care residency is completed in three years after graduation, you may obtain certification in an area of training to enhance your primary health care practice (i.e., OB, geriatrics, sports medicine, palliative care) at anytime, and it will be considered an acceptable activity for fulfillment of your service obligation. However, you may not do additional training or obtain certification in any non-primary health care sub-specialty.

LOAN REPAYMENT

When does repayment begin and end?

May payment of my PCL be deferred?

YES.

Is a PCL eligible for consolidation?

PCL is not eligible for consolidation because of the service obligation.

What happens to my PCL in the event of death or disability?

Your obligation to repay the loan will be canceled upon receipt of the required documentation in the event of your death or permanent and total disability.

FINAL THOUGHT

How should I explore whether PCL is right for me?

Example of Borrower Penalty: A borrower receives $10,000 under the PCL program. After graduating, the borrower enters a primary heath care residency program, which is completed. During the residency, repayment of the PCL was deferred. The borrower begins practicing primary health care and repaying the PCL. Interest on the loan begins accruing at the rate of 5 percent per year. After one year, the borrower decides to pursue a cardiology fellowship. The balance due on the PCL (the date the borrower ceases practicing primary health care), is $9,000. The interest on the $9,000 balance is recomputed at a rate of 18 percent per year, compounded annually. The PCL continues to accrue interest at the 18 percent rate, compounded annually, until it is paid in full. Repayment can be extended to 25 years upon request.

Other Aid Programs Through IUPUI-OSFAS

Child of Veteran and Public Safety Officer Supplemental Grant Program

This program is available to students who are Indiana residents and who submit proof of eligibility from the Department of Veterans Affairs or the appropriate agency. Students who are children of: a service-connected disabled or deceased veteran of World War I, World War II, or the Korean or Vietnam conflicts, or a deceased Indiana State Police officer, other law enforcement officer or firefighter who was killed in the line of duty, are eligible to receive fee remission for up to 124 credit hours of enrollment. This is almost full tuition for all four years of medical school.

Questions concerning eligibility for the Child of Disabled/Wounded Veteran or Child of Vietnam MIA/POW awards should be directed to:

Indiana Department of Veterans Affairs
302 W. Washington St., Room #E120
Indianapolis, IN 46204-2738 - (317) 232-3910

Federal College Work Study Program (CWSP)

The Federal CWSP provides an opportunity for students to engage in part-time work-study employment. The funds are allocated to students with financial need during the fall and spring semesters. Medical students are eligible to request this type of assistance, but students rarely have time for part-time employment in the first or second year. Students are encouraged to discuss this opportunity with MSA-SFS before seeking Federal CWSP or other employment.