1. Why is ALC changing to the Federal Direct Lending Program?
President Obama and the current administration in Washington voted and passed the H.R. 4872-Health Care and Education Affordability Reconciliation Act of 2010, requiring all federal student loans to be funded by USDE through Direct Lending beginning July 1, 2010.
2. Do I have to complete another Master Promissory Note (MPN) with the federal government even if I have signed one before with a bank or other lender?
Yes, you must sign a new Direct MPN, because the federal government will now be your new lender. This should be the last MPN you have to sign as long as you attend ALC.
3. How and when do I complete a Direct Loan MPN?
If you plan to receive a Direct Loan either in the fall of 2010 or beyond, you need to complete a Direct Loan MPN as soon as possible. By completing the MPN now you will avoid possible delays in receiving your student loan funds. You can complete the MPN here.
4. If I have already completed a Direct Loan Master Promissory Note for another school, do I have to complete one for ALC?
5. When I change from bank student loans to the Federal Direct Loan Program, will my earlier loans go into repayment?
No, as long as you remain enrolled at least half-time.
6. Can I consolidate my Direct Loans and my bank loans?
Previous loans will not go into repayment as long as you remain enrolled at least half-time without a six-month break. When you do start repayment, you have a choice to either make payments to your previous lenders and the Federal Direct Loan Program or to consolidate your loans with the lender or the Federal government. Currently, most lenders have stopped consolidating loans, so most consolidations are with the government. The benefits of consolidation depend on interest rates at the time of consolidation. Federal consolidation information: http://www.loanconsolidation.ed.gov/.
7. How do I contact the Direct Loan Program?