Loans

Loan Options and Information

In addition to receiving scholarships and grants, loans allow you and/or your parent(s) to borrow additional money to help with your investment in your future. As part of your funding options at Norwich University, you may wish to consider a Federal Stafford Loan, a Federal Parent Loan for Undergraduate Students (PLUS), or an alternative loan.

Federal Stafford Loans

The Federal Stafford Loan program makes low interest loans available to students to help pay the costs of attending post-secondary school. In order to be considered for a Stafford Loan, you must file the Free Application for Federal Student Aid (FAFSA).

Subsidized Stafford Loan

This is a need-based loan, meaning that to qualify a student must have a financial need as defined by federal regulations. The federal government pays the interest on this loan for the student while enrolled at least half-time in school and until the student begins repayment of the loan six months after leaving school. The interest will also be paid on these loans during qualified deferment periods.

Unsubsidized Stafford Loan

This loan is available to all eligible students regardless of financial need. The student is responsible for paying the interest on this loan from the time that the loan is disbursed. He/she can elect to defer the interest payments and have them added to the loan balance at the time the loan enters repayment. The principle payments are deferred while the student is enrolled at least half-time, for six months after the student leaves school, and during qualified deferment periods.

This loan is available to all eligible students regardless of financial need. The student is responsible for paying the interest on this loan from the time that the loan is disbursed. He/she can elect to defer the interest payments and have them added to the loan balance at the time the loan enters repayment. The principle payments are deferred while the student is enrolled at least half-time, for six months after the student leaves school, and during qualified deferment periods.

Facts about the Stafford Loan Programs

  • Fixed interest rate of 5.6 percent on undergraduate Subsidized Loans and 6.8 percent on graduate Subsidized Loans and all Unsubsidized Loans.
  • Repayment—no payments until six months after graduation or student stops attending at least half-time.
  • Fees—Not to exceed 1.5 percent—varies by lender

To apply for the Federal Stafford Loans, first-time borrowers must complete an online Loan Entrance Counseling Session and Master Promissory Note, which can be found on our Forms page.

Federal Parent Loan for Undergraduate Students (PLUS)

The Federal Parent Loan for Undergraduate Students or PLUS is a federal loan program that allows parents of dependent undergraduate students to take out a loan to cover the difference between the student aid package and the actual costs of the University.

Facts about the PLUS Program

  • Fixed interest rate of 8.5 percent.
  • Repayment—payments begin 60 days after the final disbursement of the loan for the academic year borrowed in. Parents can request that these payments be deferred while the student is still attending school. Loan has a standard 10-year repayment schedule but no penalty for early repayment.
  • Fees—Not to exceed 4 percent—varies by lender

To apply for a PLUS, download the PLUS Application form from our Forms page and mail it to the Financial Planning Office.

Alternative Loans

Alternative loans, also commonly referred to as private loans, are commercial loans offered by banks and other private lenders to cover the costs of college not covered by financial aid. We strongly encourage every student to explore all funding options including scholarships, grants, work study and federal loans (subsidized, unsubsidized, and PLUS), prior to applying for a private loan.

These loans differ from federal loans in several ways:

First, these loans are not guaranteed—which means that both the student and the co-signer (if needed) will be subject for a credit check.

Second, the interest rates on these loans can be higher than the federal rate. There are several places to find the current rates for Prime, T-bill, LIBOR and the other instruments that lenders use to set their interest rates, but we suggest you bookmark the following site: www.bankrate.com/brm/ratehm.asp. When you visit this site, there will be many indexes listed. The three main indexes lenders use for private loans are: Wall Street Journal (WSJ) Prime, 91Day T-bill, and the one month LIBOR plus a certain percent.

Third, there are no interest rate caps on these private loans like there are with the federal loans (including the PLUS). While these loans typically have deferred payments while you are in school and offer a grace period, interest will still accrue during these time periods. Make sure to read the conditions and terms of the loan prior to signing the promissory note. This will ensure that you will understand the loan terms when it comes time to repay the loan.

Suggested Lender’s List

Norwich University is committed to providing students with the best possible information in order to assist in the selection of a lender. The list of lenders that we recommend is only a suggestion. We do not require students to choose one of these lenders. If a student wishes to choose any other lender, we will process that loan. Norwich University does not receive any monetary or other incentives for having these lenders on our list. The lenders that we suggest on our list are there because they have met the following criteria at the time this list was created:

  1. The lender offers benefits to students in the form of fee reductions, interest rate reductions, or other benefits.
  2. The lender has demonstrated over time that they provide excellent customer service to students.
  3. The lender participates in electronic processing as well as paper processing, making it easy for the student to apply for and receive their loan funds.
Recommended lenders
lender phone website
Bank of America 1-800-344-8382 www.bankofamerica.com
Citizen–s Bank 1-800-708-6684 www.citizensbank.com/edu
Key Bank 1-800-539-5363 www.key.com/educate
VSAC 1-800-642-3177 www.vsac.org

If you wish to choose a lender other than those on our list, please contact our office at:

Office of Student Financial Planning
158 Harmon Drive
Northfield, VT 05663
(802) 485-2015 ext. 0
nufinaid@norwich.edu

Lender Practices and Code of Conduct for the Federal Family Education Loan Program (FFELP) and Private Loan Programs

  • As a FFELP participant, our goals are to help students (and parents) receive in an accurate and timely manner the loans for which they qualify.
  • As a FFELP participant, we shall encourage students and families to borrow only what they absolutely need to persist and succeed in postsecondary education.
  • As a FFELP participant, we as financial aid professionals support the integrity of the financial aid process and our responsibility to assist our students.
  • As a FFELP participant, we shall fairly and accurately disclose all terms and conditions related to loan products to students and families.
  • As a FFELP participant, any participating lender, while not defined as preferred, will disclose and be transparent in its consumer information about loan products offered; including but not limited to, interest rates, terms and conditions on federal loans.
  • As a FFELP participant, any lender listed as a participating lender will demonstrate high quality loan servicing and define additional benefits beyond the standard terms and conditions.
  • As a FFELP participant, a participating lender list is not restrictive and allows students and families to select any lender and understand the process for selecting a lender and applying for a loan. The school will promptly certify any loan from any lender selected by the borrower.
  • As a FFELP participant, a lender will not be included on a list of participating lenders in exchange for a prohibited inducement. A lender included on a participating lender list is based on borrower benefits for the students and families.
  • As a FFELP participant, Norwich University’s financial aid professionals/administrators will practice the Statement of Ethical Principles and Code of Conduct for Institutional Financial Aid Professionals as adopted by the National Association of Student Financial Aid Professionals (NASFAA).

*“An institutional financial aid professional is expected to always maintain exemplary standards of professional conduct in all aspects of carrying out his or her responsibilities, specifically including all dealings with any entities involved in any manner in student financial aid, regardless of whether such entities are involved in a government sponsored, subsidized, or regulated activity. In doing so, financial aid professional should:

  • Refrain from taking any action for his or her personal benefit
  • Refrain from taking any action he or she believes is contrary to law, regulation, or the best interests of the students and parents he or she serves.
  • Ensure that the information he or she provides is accurate, unbiased, and does not reflect any preference arising from actual or potential personal gain.
  • Be objective in making decisions and advising his or her institution regarding relationships with any entity involved in any aspect of student financial aid.
  • Refrain from soliciting or accepting anything of other than normal value from any entity (other than an institution of higher education or governmental entity such as the US Department of Education) involved in making, holding, consolidating, or processing of any student loans, including anything of value (including reimbursement of expenses) for serving on an advisory body or a part of a training activity of or sponsored by any such entity.
  • Disclose to his or her institution, in such manner as his or her institution may prescribe, any involvement with our interest in any entity involved in any aspect of student financial aid.”

*Excerpt from National Association of Student Financial Aid Administrators&rquo; (NASFAA) Statement of Ethical Principals and Code of Conduct for Financial Aid Professionals.