Federal Direct Loans are a form of financial aid that must be repaid, usually after you graduate, withdraw from college or drop below half-time enrollment status. Federal Direct Loans provide low fixed interest rates with attractive repayment options and deferment/ cancellation opportunities.

Direct Subsidized Loans: Are awarded based on financial need as determined by the results of your FAFSA. The federal government pays the interest while you are in college, and for the first six months after you graduate, leave school, or drop below half-time.

Direct Unsubsidized Loans: For all eligible students (those who have completed a FAFSA), regardless of financial need. You are responsible for paying the interest. You can either let the interest accumulate or pay the interest while you are in school with no penalty.

Direct Parent Loan PLUS Loan: This loan is for parents of dependent students. Parents may borrow up to the cost of education less other financial aid, including any Direct Loans the student may be eligible to receive. The repayment of this loan begins 60 days after the funds have been fully disbursed to the student’s account.

To receive your first William D. Ford Federal Direct Loan at Northwest State Community College, you must complete an Entrance Counseling and Master Promissory Note (MPN). The Entrance Counseling process ensures that you have a full understanding of the rights and responsibilities you will incur upon accepting this loan. The MPN will serve as your authorization to borrow loans through the Direct Loan program.
This on-line Entrance Counseling was designed to help you understand your Direct Loan. Any undergraduate, graduate, or transfer student attending NSCC that has not previously borrowed funds from the William D. Ford Federal Direct Loan program must complete this process before their loan can be disbursed. Please contact the Financial Aid Office at any time if you have additional questions about the entrance counseling process.

The MPN is a promissory note that can be used to make Federal Direct student loans for multiple academic years (up to 10 years). Because NSCC is authorized and chooses to make multiple loans under the same MPN for more than one academic year, you will only sign one MPN. It will be used for all of your Direct Loans at NSCC. For example, if you enroll in college as a freshman and borrow under the Direct Loan Program for all years of study, you are able to borrow under this MPN for all years.
Parents borrowing a Federal Direct PLUS Loan are also required to complete an MPN. The PLUS loan version of the MPN is also available electronically from the link below.

The electronic MPN site allows you to complete and sign an MPN over the web using your unique PIN number provided by the U.S. Department of Education. Additional details are included on the site. When completing the electronic PLUS MPN, the parent borrower's unique PIN number is required.

Loan Proration

Federal regulations require the maximum annual Federal Stafford Loan amount an undergraduate student may borrow to be prorated in cases where it is known that the student’s remaining period of study will consist of less than one (1) Academic Year.

• The prorated amount the student may borrow in this period of study is based on a ratio of the number of credits enrolled divided by 24.  This amount is then multiplied by the student’s annual loan limit (based on dependency status and grade level) to determine the maximum the student may borrow in their final term of undergraduate study.
• Stafford Loan eligibility will be prorated based on enrollment after drop/add period expires (first week of class).