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Student Loan Process

All students must complete the Free Application for Federal Student Aid (FAFSA) by using “FAFSA on the Web” at Once the FAFSA has been completed and SUNY Sullivan has the results, the student loan application process consists of three basic steps:

Step 1: Complete your Online Entrance Counseling

Complete your online entrance counseling on the Federal Direct Loan website at

All federal direct loan borrowers must complete student loan entrance counseling before any loan funds will be dispersed.

Once you have completed the entrance counseling you will then be taken to the Completion Verification page. SUNY Sullivan will be notified electronically when you complete your counseling.

Step 2: Complete and Sign your Electronic Master Promissory Note (MPN)

Complete a Federal Direct Loan Master Promissory Note (MPN) electronically on the web at

All federal direct loan borrowers must complete a Federal Direct Loan Master Promissory Note (MPN) before any loan funds will be dispersed.

You must complete the entire process in a single session. If you exit the site before signing your electronic MPN, you will be required to start over from the beginning.

IMPORTANT: Be ready to provide two contact references (name, address and telephone number). These should be people who have known you for at least one year (preferably relatives) and who live at different addresses. Remember to always use your full legal name as it appears on your social security card.

Step 3: Complete the Federal Direct Loan Request Form

Student borrowers must complete the Federal Direct Loan Request Form  and submit it to the financial aid office.

There are three types of direct loans:

Federal Direct Subsidized Loans

These are based on financial need. The government will pay the interest on the loan while the student is in school.

Federal Direct Unsubsidized Loans

Students get federal direct unsubsidized loans regardless of need but will have to begin paying interest charges while in school.

Federal Direct PLUS Loans

Parents of dependent students can borrow a Federal Direct PLUS Loan to help pay for their child’s education.

Eligibility Criteria

To be eligible for a federal direct loan a student must:

  1. Submit a valid FAFSA;
  2. Be a U.S. citizen or permanent resident alien;
  3. Be registered with Selective Service, if you’re a male;
  4. Be matriculated in a degree program;
  5. Be enrolled in at least 6 credit hours (part-time enrollment); and
  6. Maintain Satisfactory Academic Progress (SAP).

Additional information on federal direct loans is available from the Dept. of Education at

Maximum Loan Amounts

Borrower’s Academic Level Dependent Student
(Sub + Unsub = Yearly Limit)
Independent Student
(Sub + Unsub = Yearly Limit)
 1st Year Undergraduate Student $3,500 + $2,000 = $5,500 $3,500 + $6,000 = $9,500
 2nd Year Undergraduate Student $4,500 + $2,000 = $6,500 $4,500 + $6,000 = $10,500


**** Time limitation on Direct Subsidized Loan Eligibility for New Borrowers

Beginning with July 1, 2013 Public Law 112-141 limits for new borrowers of a Federal Direct Subsidized Loan to 150% of the required length to complete a degree, or 3 years of eligibility to complete an associate degree. (For example: A student enrolled in a 2 year program will have 3 years worth of subsidized eligibility.)

Interest Rates

Loan Rates 2017-2018

 Loan Type Borrower Type Interest Rate Origination Fee (10/1/17)
Direct Sub & Unsubsidized Loans Undergraduate 4.45% 1.066%
Direct Unsubsidized Loans Graduate 6.0% 1.066%
Direct Parent & Grad PLUS Loans Parent/Graduate 7.0% 4.276%

Receipt of Loan Funds/Right to Cancel or Lower Amount of Loan

Your loan funds will be credited to your student billing account in equal disbursements for all semesters reflected on your award letter. You will be notified by e-mail when your loan funds have been credited to your student account and you will also be notified that you have the right to lower or cancel the amount of the loan disbursement within 14 days of receiving the notice from the school that the money was credited. You also may request that any refund that you receive be returned to the direct loan program to lower the amount of your loan. At any time prior to receipt of the loan, you have the right to lower your loan amounts or to cancel any and all of your loans by notifying the office of financial aid in writing.

Exit Counseling

Federal regulations require that all student loan borrowers must have an exit interview/exit counseling during their final semester at the college. All borrowers should plan to complete an exit counseling prior to dropping below six credits, withdrawing or graduating. Exit counseling is completed at the website. Topics include: rights and responsibilities of borrwers, when repayment starts, various repayment plans, deferments, loan consolidation and consequences of default. This site also gives the borrower up-to-date information on his/her student loan balances.

Students may access information about exit counseling at This provides access to the Exit Counseling Guide as well as the information on repayment plans, deferments and consolidation.


There are several ways to repay a federal direct loan:

A standard repayment plan has a fixed monthly repayment amount for a fixed period of time, usually 10 years.

An extended repayment plan has a lower fixed monthly payment amount and loan repayment can be extended beyond the usual 10 years.

A graduated repayment plan usually begins with lower monthly payments and payment amounts increase at specified times. Payments may be the usual 10-year period or they may be extended beyond the usual 10 years.

Income-contingent repayment plan set annual repayment amounts based on the borrower’s income after leaving school. The loan is repaid over an extended period of time not to exceed 25 years.

A servicing agency will be responsible for maintaining the loan account and repayments. It is the student’s responsibility to maintain contact with that agency.

Loan Consolidation

Students who have previously borrowed FFELP student loans through a lending institution and who are now borrowing a federal direct loan are encouraged to consolidate all of their student loans into one federal direct consolidation loan. This will help the borrower avoid the situation of owing two separate loans to two different lenders. Borrowers who are interested in consolidating all of their student loans into one consolidation loan can apply for a Direct Consolidation Loan at