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Federal Student Loans
What is a Federal Direct Student Loan?
A Federal Direct Student Loan is financial aid that must be paid back with interest. Butte College participates in the Federal Direct Loan Program. Direct loans are low-interest education loans for students to help pay for college costs. There is no credit check or cosigner required to qualify. The lender is the U.S. Department of Education, which assigns loans to one of its contracted loan servicers throughout the country after a loan is originated by a school for a student. You can find out who your loan servicer is two weeks after your first loan disbursement is issued by the school. Go to http://studentaid.gov to see your loan servicer contact information and to keep your information updated with them. Your loan servicer will be responsible for any questions you have for your loan after the funds have been distributed.
Go to http://studentaid.gov to see your loan servicer contact information and to keep your information updated with them. Your loan servicer will be responsible for any questions you have for your loan after the funds have been distributed.
Loan Repayment is necessary:
Federal student loans are long-term obligations. Accepting a loan means accepting the responsibility for repaying the money you borrow including interest costs and fees. Before you request a loan, make sure you find out the true costs, interest rates, and how long it will take to repay the loan. To get answers to these questions and more, go to http://studentaid.gov
Be A Smart Borrower!
You can also find more information regarding interest rates , how to apply for a loan, repayment plans, deferments, forbearance, consequences of default and much more, go to http://studentaid.ed.gov or visit the Butte College Financial Aid office and ask questions.
To get free help with your loan options, go to www.ECMC.org
Three Requirements of All Borrowers:
Requirements for Borrowers:- Entrance Counseling -Entrance Counseling is required of ALL first time or returning borrowers and is completed as a part of the of the Butte College Federal Direct Loan request process. Without Entrance Counseling your loan will not be linked between the Department of Education and Butte College and will not disburse. For more information visit http://studentaid.gov/
- Master Promissory Note (MPN) is your promise to repay the loan. You must complete the online MPN. For your convenience, you may electronically sign and submit the MPN online from http://studentaid.gov/
- Exit Counseling - Entrance Counseling is required of ALL first time or returning borrowers and is completed as a part of the of the Butte College Federal Direct Loan request process. Without Entrance Counseling your loan will not be linked between the Department of Education and Butte College and will not disburse. For more information visit http://studentaid.gov/
- Complete the 2023-2024 Free Application for Federal Student Aid (FAFSA). You may be eligible for a loan as part of your financial aid award. Most students and their families are eligible for some form of federal educational loan assistance. Submitting a FAFSA is the first step.
- Complete Entrance Counseling
- Complete Master Promissary Note
- You must be registered in and actively attending a minimum of 6 payable units (at least half-time) per semester
- You must be enrolled in a degree-granting or eligible certificate program (Associate Degree or Certificate of Achievement)
- You must meet Satisfactory Academic Progress(SAP) To maintain continued eligibility to borrow, you must also complete at least 6 units during each semester that you receive loan funds
- You must not have outstanding required tasks and have a completed Financial Aid file
- You must not be in default on any type of student loan
- You must not owe a repayment on a federal student grant
Requesting a 2023-2024 Federal Direct Loan
How to Request a Loan-
From your Butte College student email only, send a request to studentloanrequest@jqzhengxing.com. Include your name and Butte College student ID number
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The Financial Aid Office will review your financial aid file to ensure you are meeting the above minimum criteria and are eligible to receive and complete a Federal Direct Loan request form
- If you are eligible- You will receive an email in your student email account with the link to complete the online ‘Butte College Financial Aid Direct Loan Request Form’
- If you are not eligible at this time- you will receive an email with information as to why you do not currently meet the minimum qualifications and what, if any, steps you must take
To AVOID DELAY in receiving funds, you must complete the following before completing and submitting the online Federal Direct Loan request form:
- Login to your studentaid.gov account with your FSA ID
- Complete Entrance Counseling and the Master Promissory Note (MPN). Butte College cannot begin processing your Federal Direct Loan request without these completed by the student first!
- Review your aggregate student loan balance. If you borrow the annual maximum every year, you may reach the aggregate limit before you have completed your educational goal. Be aware that your account may not yet include your most recent loan, be sure to keep an accurate track of your loans.
Students who do not meet these eligibility requirements cannot apply for a student loan or will be subject to a delayed processing. Please plan accordingly.
- Incomplete Requests cannot be processed. Please allow 6 weeks for Loan Request Forms to be processed during peak times. Loan Request forms are processed in the order they are received.
- You will receive a Direct Loan Certification email to your student email with your estimated earliest loan disbursement date after your request has been approved and processed. If you loan request has been denied or reduced you will receive a notice to your student email.
- Enrollment verification- Loan funds will not be disbursed until after census/ Financial Aid freeze dates each Fall and Spring term in order to verify enrollment in at least 6 units. All students will receive a loan certification email with the earliest possible disbursement date. Look on the Direct Loan Request Form for the actual dates.
- First time student borrowers with no prior Federal Direct Loan are required by law to complete 30 days of their program of enrollment before receiving their first loan disbursement.
What kinds of problems could cause my loan to be delayed, reduced or cancelled?
Enrolled less than half-time (6 units)
Students must be enrolled in and attending Butte College at least half-time (6 units)
for the entire loan term. Open Entry/Open Exit and late-starting courses must be added
by freeze dates to count toward loan eligibility.
Lack of Satisfactory Academic Progress
What kinds of problems could cause my loan to be delayed, reduced or cancelled?
- Students failing to meet required standards of Satisfactory Academic Progress are not eligible to receive financial aid including loans for the entire loan period.
- Loans for students on Financial Aid Probation or approved Excess Units Petitions may be delayed or denied until their Satisfactory Academic Progress status is confirmed.
- Students who have been disqualified due to lack of Satisfactory Academic Progress must be reinstated before they can apply for a loan, and may be subject to reduction or cancellation of loans.
Student loan debt is an issue for individuals and well as a national concern. The federal government has set a maximum amount that undergraduates may borrow. Since "undergraduate" includes all course work through a Bachelor's degree, it is important not to "over-borrow" at the community college level.
High Debt Load Management. For a student enrolled at Butte College, pursuing an Associate degree or Certificate of Achievement, the college considers the following amount totals to be excessive debt load for a student attending community college:
Dependent Students | Debt load of $12,000 in all loans (including all prior loans) |
Independent Students | Debt load of $21,000 in all loans (including all prior loans) |
Students who have reached these debt loads are considered High-Risk Borrowers and are subject to delay, reduction or denial of their loan request. Please plan accordingly for a delayed loan review.
Federal regulations require loans to be released in at least two payments.
- Academic-year loans (fall and spring semesters) have one payment after the loan is originated in the fall and the second at the beginning of the spring semester.
- One-semester loans are divided into two payments, one after the loan is originated and a second at the mid-point of the semester. Students must maintain at least half-time enrollment (6 units) to receive a second payment under either loan arrangement.
- Summer Session is not part of the regular academic year (fall and spring semesters) and student loans are not granted for summer course work.
Subsidized Direct Loan is awarded on the basis of financial need. Unmet "need" is determined by subtracting the Expected Family Contribution (EFC) and all other forms of aid from the Cost of Attendance (COA), or budget. Interest is paid for you by the federal government while you are enrolled in school at least half-time and during periods of authorized deferment. The federal government "subsidizes" your loan, by paying the interest during these periods.
How Subsidized Loan Eligibility is Calculated |
COA - EFC - all other aid (grants + scholarships + work-study) = Subsidized Loan eligibility up to annual limit (see annual limits below) |
Unsubsidized Direct Loan is not awarded on the basis of need and is available to you regardless of income. Interest will be charged from the time the loan is disbursed until it is paid in full. You may choose to make periodic interest payments or opt to have the accrued interest capitalized (added on) to the principle loan amount.
How Unsubsidized Loan Eligibility is Calculated |
COA - all other aid (grants + scholarships + work-study = Unsubsidized Loan eligibility up to annual limit (see annual limits below) |
2023-2024 ANNUAL Federal Direct Loan Limits
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Dependent Student | Subsidized | Unsubsidized | Total |
1st year (up to 29 units completed) |
Up to $3,500 | Up to $2,000 | $5,500 |
2nd year (30+ units completed) |
Up to $4,500 | Up to $2,000 | $6,500 |
Federal Direct PLUS denied Additional (Not all students have eligibility for additional ) |
Up to $2,000 | TBD | |
Independent Student* | Subsidized | Unsubsidized | Total |
1st year (up to 29 units completed) | Up to $3,500 | Up to $6,000 | $9,500 |
2nd year (30+ units completed | Up to $4,500 | up to $6,000 | $10,500 |
Interest rates and fees are adjusted by Congress and begin July 1 for each academic year. As per changes authorized by the Bipartisan Student Loan Certainty Act of 2013, the Direct Loan interest rate will be the sum of a uniform "index rate" plus an "add-on" that varies depending on the type of loan and the borrower's grade level. The interest rate for a loan, once established, will apply for the life of the loan -- that is, the loan is a fixed-rate loan. As a result, student borrowers who borrow in more than one award year will likely have a number of fixed-rate loans, each with a different interest rate. Loans borrowed in the academic year 2013-2014 had a 3.86% interest rate for Subsidized and a 3.86 % interest rate for Unsubsidized.
Interest. Loans must be repaid in full. In addition to the principal (the amount you borrow), interest accumulates on the loan as an expense paid by the borrower for the use of the money. The expense is calculated as a percentage of the unpaid principal amount.
DIRECT STUDENT LOAN INTEREST RATES |
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Subsidized Loans disbursed on or after July 1, 2023 and before July 1, 2024 | 5.50% | ||
Unsubsidized loans disbursed on or after July 1, 2023 and before July 1, 2024 | 5.50% |
Origination Fees. All loans have loan fees (also called origination fees) that are deducted proportionately
from each loan disbursement you receive. This means that the money you receive will
be less than the amount you actually borrow. You are responsible for repaying the
entire amount.
An origination fee will be automatically deducted before disbursement.
- For loans disbursed before Oct. 1, 2023, the fee is 1.057% of the loan.
- For loans disbursed on or after Oct. 1, 2023, and before Oct. 1, 2024, the fee amount is 1.057%.
Contact Us
Butte College School Code
006972
SAS 160 Rm. 110
3536 Butte Campus Drive
Oroville, CA 95965
Operating Hours
Main Campus:
Mon-Thur 8:00 a.m. - 5:00 p.m.
Fri: 8:00 a.m. - 12:00 p.m.
1st & 3rd Thursday of every month: 8:30 a.m. - 5:00 p.m.
Chico Center:
Mon-Thur: 8:30 a.m. - 6:00 p.m.
Fri: 8:00 a.m. - 12:00 p.m.
Glenn County:
Tuesday or Wednesday of each week: 8:30 to 6:00 p.m.
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