About Federal Direct Loans

Student loans require repayment at a future date. In most cases, loans do not have to be repaid until six months after leaving school or dropping below half-time enrollment (6 credit hours is considered half-time at SCC).  If you decide to discontinue your education before graduating, you will be required to start payments towards your loan six months after you ceased half-time enrollment.

When a student borrows money through the Federal Direct Student Loan Program, information is provided by the college to the National Student Loan Data System (NSLDS) and its authorized users such as guaranty agencies, lenders and educational institutions.  Make sure that you understand your Borrower Rights and Responsibilities, as well as available repayment options before you borrow.

Failure to repay your loan will result in consequences such as:

  • Entire unpaid loan (plus interest) becomes immediately due
  • Unpaid loan reported to national credit bureaus
  • Negative effects on your credit rating for at least 7 years
  • Withholding of state and federal income tax refunds
  • Garnishment of wages
  • Losing eligibility to defer payments on prior student loans
  • Losing eligibility for financial aid

Learn more about Loan Default.

Federal Direct Loan Types

  • A subsidized loan is awarded on the basis of financial need as determined by the Expected Family Contribution (EFC) number found on your Student Aid Report (SAR). You will not be charged any interest before you begin repayment or during authorized periods of deferment.  The federal government "subsidizes" the interest during these periods.  Once you enter repayment, interest will start accruing.  Note: If you receive a Direct Subsidized Loan that is first disbursed between July 1, 2012, and July 1, 2014, you will be responsible for paying any interest that accrues during your grace period. If you choose not to pay the interest that accrues during your grace period, the interest will be added to your principal balance.
  • An unsubsidized loan is not awarded on the basis of need.  You'll be charged interest from the time the loan is disbursed until it is paid in full.  If you allow the interest to accumulate, it will be capitalized, therefore the interest will be added to the principal amount of your loan and additional interest will be based upon the higher amount.
  • A consolidation loan allows a borrower to consolidate (combine) multiple federal student loans into one loan. The result is a single monthly payment instead of multiple payments.  Information about consolidation can be accessed at http://www.loanconsolidation.ed.gov/ 

Borrowing a Student Loan

Below are the steps for requesting a student loan. We recommend that you print the Loan Information packet for important deadlines and instructions.  Incomplete files will delay processing! 

  1. Apply for admission to SCC
  2. Request official transcripts from all institutions you have previously attended.  Then complete a Request for Evaluation of Transcripts form. 
  3. Complete the Free Application for Federal Student Aid (FAFSA)*.
  4. Complete loan Entrance CounselingNote:  Even if you have completed Entrance Counseling at another school, you are required to complete the session again for SCC.
  5. Sign a Master Promissory Note (MPN)Note:  A Direct Loan MPN may be active for 10 years.  A Direct Loan MPN will expire after 1 year if no loans are borrowed.  If you have an active MPN through the William D. Ford Federal Direct Loan program, you do not need to complete a new MPN.
  6. Complete the Loan Data Sheet

Highly Recommended:

  • Set an appointment with the Loan Coordinator
  • Create a SALT log-in at www.saltmoney.org/stchas.  With SALT you can learn how to manage your student loans and find more free money with scholarship searches and budgeting tips.

Establishing & Maintaining Eligibility

A student must be degree seeking at SCC and must follow his/her degree audit in order to be eligible for financial aid. To qualify for a loan, a student must be enrolled in a minimum of 6 credit hours by the term census date. See Loan Information packet and Financial Aid Handbook for additional details.

All sources of funding are considered when determining your maximum amount of eligibility for financial aid. This is including but not limited to PELL, SEOG, Federal Direct Student Loans, Scholarships, A+ Scholarship, Vocational Rehabilitation and any other program participation.

Students receiving financial aid must meet satisfactory academic progress standards (SAP).  Failure to meet these standards may result in a student's loss of financial aid eligibility until satisfactory academic progress can be reestablished. Refer to the Financial Aid Handbook for more information about SAP.

Loan Limits

Enrollment Services will determine the amount you are eligible to receive. It is possible to receive both a subsidized loan and an unsubsidized loan for the same enrollment period. The amounts that you may borrow will depend upon whether you are a dependent versus independent student, your Cost of Attendance (determined by the college/university that you attend), and your current grade level. It is recommended that you borrow only what is necessary.


Loan Limits Chart
Credit Hours
0-27 $5,500/year $9,500/year $3,500/year
28-96 $6,500/year $10,500/year $4,500/year

Loans will be pro-rated for students enrolled in their last semester prior to graduation due to the shortened length of that final semester. Pro-ration will be based on the number of credit hours enrolled for that term according to the chart below.

Loan Proration Chart
0-27 Hrs.
0-27 Hrs.
28-96 Hrs.
28-96 Hrs.
6 $1,375 $2,375 $1,625 $2,625
7 $1,604 $2,770 $1,895 $3,062
8 $1,833 $3,166 $2,166 $3,500
9 $2,062 $3,562 $2,437 $3,937
10 $2,291 $3,958 $2,708 $4,375
11 $2,520 $4,354 $2,979 $4,812
12 $2,750 $4,750 $3,250 $5,250

Exit Counseling

Exit counseling is required before you withdraw, graduate, or drop below half-time enrollment (6 credit hours).   You must complete Exit Counseling upon leaving SCC, even if you plan to transfer to another school.  Exit Counseling provides important information you will need as you prepare to repay your federal student loans.  You will review your rights and responsibilities as a borrower and receive helpful tips for loan repayment.

Complete exit counseling online at www.studentloans.gov. Select “Loan Exit Counseling,” then complete the steps listed. 


Financial Aid
Contact Information

General Information

A+ and State Programs

VA Benefits


Financial Aid Appeals & Scholarships