Code of Professional Conduct
The Office of Financial Aid staff, and other employees, and agents having responsibilities with respect to education loans or other financial aid, are committed to the highest level of ethical and professional standards in providing financial aid services and in the administration of those programs. The individuals follow the institutional Code of Professional Conduct, and the ethicial principles and code of conduct upheld by the National Association of Student Financial Aid Administrators for its member institutions.
Loans can be used for qualified education and living expenses up to the annual cost of attendance minus other aid such as scholarships, grants, or other assistance such as veterans benefits. The Office of Financial Aid is required to certify loan applications including loan amounts with the lender based on the borrower's expected period of enrollment, cost of attendance, and amount of other aid received.
All student loans have to be repaid with interest-even if the student doesn't finish school, is unhappy with the education provided, is unable to find a job or is making less money than planned. Students should be conservative and borrow only what is needed. The amount of money borrowed can have long-term effects that influence future decisions and choices.
Basic Tips for Student Loan Borrowers
- Consider all sources of financial assistance to keep borrowing as minimal as possible
- Submit the needs analysis application (NeedAccess, or FASFA when available) and all required supporting documents by the March 31st priority deadline to be considered for WMed need-based scholarships
- If requested, be sure to submit completed, signed and dated documents by stated deadlines to maximize opportunities for gift aid.
- If there are extenuating circumstances that may affect the amount of financial aid, contact the Office of Financial Aid.
- Take advantage of the resources available in the Office of Financial Aid including financial counseling, planning, and assistance with budgeting and debt management.
Loan Types: Federal versus Private/Alternative
There are two main types of student loans:
- Federal student loans funded by the federal government. These include the federal Direct Unsubsidized and Direct PLUS Loan programs.
- Private student loans funded by non-federal lenders such as banks, credit unions, state agencies, and schools. Private loans are also referred to as “alternative loans”.
At present, Western Michigan University Homer Stryker M.D. School of Medicine does not participate in federal financial aid programs which includes federal loan programs. As a new, private medical school, approval for program participation by the U.S. Department of Education is expected during the 2016-17 academic year. Until approval is obtained, our medical students will rely on scholarships and private/alternative student loans as sources of assistance.
More information about the differences between federal and private/alternative student loan programs is available from the U.S. Department of Education. Click here to learn more.
Loan Options During Medical School
Until the U.S. Department of Education approves federal program participation, WMed students:
- Are eligible to apply for private/alternative loans but not federal student loans.
- Are not eligible for in-school deferment on federal student loans borrowed during undergraduate and graduate school. Forbearance and repayment options are explained below.
Private/Alternative Student Loans
Students who require loan assistance to meet their educational costs during the 2016-17 academic year will borrow private/alternative loans until federal loans become available. There are four lenders currently offering these loans based on our status with the U.S. Department of Education. They can be viewed by clicking on the FASTChoice link below. There are no preferred lender arrangements between any of these lenders and WMed. Students may choose to borrow from any lender that best meets their needs. If considering a loan from a lender not listed in FASTChoice, students should first contact that lender to confirm that they can process loans for WMed based on our current status with the U.S. Department of Education, and then should notify the Office of Financial Aid.
WMed uses FASTChoice™ an independent student loan comparison and application tool for borrowers, schools and lenders. This online resource is made available at no cost by the Great Lakes Higher Education Corporation.
FASTChoice™ enables students to:
- compare the interest rates, terms, and conditions of multiple loans to determine which option best fits their needs;
- link directly to the application page of the lender they choose.
Students who apply for a private education loan will be asked by their lender to submit a Private Education Loan Applicant Self-Certification Form. The student will also receive additional disclosure information about their loan before it is disbursed. Students, and cosigners if applicable, are responsible for understanding and complying with all of the terms and conditions of their education loans.
After a lender approves an application for a private education loan, the lender will send a certification request to the Office of Financial Aid. Our office will verify eligibility, including the requested loan amount. The amount requested cannot exceed the Cost of Attendance minus any other aid the student will receive during the academic year.
Loan funds will be disbursed to the school in two equal payments and applied directly to students' tuition accounts according to the billing schedule. If the amount disbursed exceeds the amount owed, it will create a credit balance on the student's account which will be issued to the student.
Federal Student Loans
When federal program participation is granted by the U.S. Department of Education, WMed students will complete the Free Application for Federal Student Aid (FAFSA) and other loan requirements to apply, and be approved for federal unsubsidized and Grad PLUS loans. Students will be notified of their loan eligibility by the Office of Financial Aid.
- The FAFSA is available at www.fafsa.gov
- Federal loan requirements are available at www.studentloans.gov. Students will need to:
- Create an account and set up a FSA ID
- Sign a master promissory note and complete online entrance counseling for each type of loan borrowed (unsubsidized and Grad PLUS).
Students are encouraged to apply for federal loans when available before applying for private loans.
Federal Loan Terms, Repayment Options, and Repayment Calculators
The U.S. Department of Education makes information available about its loan programs, repayment options, and estimated repayment schedules. Click here for more information.
Students may also utilize the Associate of American Medical Colleges (AAMC) FIRST loan information and repayment calculator. Click here for more information.
Managing Loans Borrowed Prior to Medical School
Federal Student Loans
Students can locate their undergraduate and graduate federal student loans and identify their loan servicers on the National Student Loan Data System. Loan servicers are the point of contact to apply for deferment, forbearance, and repayment plans.
In-School Deferment versus Forbearance and Repayment Plans
When federal program participation is granted, federal loans will become eligible for in-school deferment provided the student meets enrollment requirements and is not on a leave of absence. Until that time, students with undergraduate and graduate federal student loans should contact their loan servicer(s) to discuss forbearance and repayment options such as one of the income-driven repayment plans. When considering options, students should become familiar with their servicer's policy on interest capitalization. Unpaid interest may be "capitalized" (added to the original loan balance), which will increase the total amount owed.
An income-driven repayment plan provides the lowest monthly payment, and potentially a $0 monthly payment. Income-driven repayment plans are approved for up to 12 months and require a new application to be extended beyond the period of approval.
A forbearance is a temporary postponement or reduction of monthly payments. A forbearance can be approved for up to 12 months and requires a new application to be extended beyond the period of approval. Interest on all loans (Subsdized, Unsubsidized, and PLUS loans) continues to accrue. Lenders may grant a forbearance for up to 36 months during periods that are not part of a medical internship or residency. Lenders are required to grant forbearance during periods of medical internship or residency training.
Students should contact their lender or loan servicer to discuss whether a repayment plan or a forbearance is the better option. More information about managing loans, selecting repayment plans, and locating loan servicers, can be found at Federal Student Aid-Repay Loans.
Students should check with their lender or loan servicer to verify when undergraduate and graduate private loans will enter repayment.
Loan Counseling Requirements
Students who borrow federal loans are required by federal regulation to complete entrance counseling when they first borrow, and are required to complete exit counseling when they graduate or drop below half time enrollment due to a leave of absence, withdrawal, or dismissal. These requirements will be implemented when WMed begins participating in the federal student loan programs. The purpose of these counseling requirements is to ensure that students understand the terms and conditions of their loans, and their rights and responsibilities as federal loan borrowers.