Free financial aid, such as grants and scholarships, are the best option to cover the cost of college. If, however, you still need funds to cover the cost of college, Federal Direct Loans may help you bridge the gap. A Federal Direct Loan is a loan offered from the Department of Education and it will need to be repaid with interest.
Before considering student loans, you should always seek out aid you don't have to repay.
Remember, just because you're approved for a certain loan amount doesn't mean you have to take all of it. You'll have to pay back whatever you borrow plus interest, so taking out more than you need could be costly in the long run.
Direct Subsidized Loans and Direct Unsubsidized Loans are federal student loans offered by the U.S. Department of Education (ED) to help eligible students cover the cost of higher education at a four-year college or university, community college, or trade, career, or technical school.
Allan Hancock College will determine the amount you can borrow based on your cost of attendance and other financial aid you receive. However, there are limits on the amount in subsidized and unsubsidized loans that you may be eligible to receive each academic year (annual loan limits) and the total amounts that you may borrow for undergraduate and graduate study (aggregate loan limits). The actual loan amount you are eligible to receive each academic year may be less than the annual loan limit. These limits vary depending on:
- what year you are in school and
- whether you are a dependent or independent student.
There are three (3) types of student loans, we offer:
Direct Subsidized Loans are available to undergraduate students with financial need. Your school determines the amount you can borrow, and the amount may not exceed your financial need. The U.S. Department of Education pays the interest on a Direct Subsidized Loan.
- while you’re in school at least half-time,
- for the first six months after you leave school (referred to as a grace period*), and
- during a period of deferment(a postponement of loan payments).
Direct Unsubsidized Loans are available to undergraduate students; there is no requirement to demonstrate financial need. You are responsible for paying the interest on a Direct Unsubsidized Loan during all periods. If you choose not to pay the interest while you are in school and during grace periods and deferment or forbearance periods, your interest will accrue (accumulate) and be capitalized (that is, your interest will be added to the principal amount of your loan).
Student Loan Application Process, make sure you follow this step sequence:
Complete and submit proof you have taken and successfully completed a Career Exploration course at Allan Hancock College. Those courses that qualify are:
- Personal Development 100 – Personal and Career Exploration (3 units) or
- Personal Development 311 – Career Awareness (1½ units)
Or meet with a Career Center Technician in the Career Center and receive advising in job search skills and career exploration. If you choose the latter option, please call the career advising at (805) 922-6966, ext. 3374 for the Santa Maria Campus to make an appointment with a Career Center Technician.
Meet with an Academic Counselor to complete a Comprehensive Student Education Plan (SEP),
- List your educational goal and degree objective.
- Make sure your program of study and your major match up with your SEP,
- list the date you are expected to complete your degree objective,
- Your financial aid file, for the year you are requesting a student loan, is complete and
- You are in good satisfactory academic standing (you are not in FA cancellation status).
- Complete, sign and submit your 2023-24 Student Loan Request
Entrance loan counseling is required if you not have previously received a Direct Student Loan at Allan Hancock. If this is your first student loan at Hancock College, check your MyFinancial Aid portal for the Student Loan Entrance Counseling prompt (a week or two after submitting your loan request).
Your Master Promissory Note (MPN) is a legal binding document in which you promise to repay your loan(s) and any accrued interest to the U.S. Department of Education. It also explains the terms and conditions of your loan(s). A Master Promissory Note is required if you have not previously received a Direct Student Loan from Allan Hancock College.
After completing your online Entrance Loan Counseling (ELC), check your MyFinancial Aid portal for completion of your Student Loan Master Promissory Note (MPN).