Direct Loan Steps
Borrowing a Direct Stafford Loan
As part of your financial aid offer, you may have been offered a Federal Direct Stafford Loan. If you accept the loan offer, you will be borrowing money from the U.S. Department of Education and agreeing to repay it under the terms and conditions of the loan.
Although a Direct Stafford Loan is a convenient source of additional funding for your education, it is a loan that will be repaid with interest. It is important to budget and borrow carefully:
- Consider ways to keep your costs down in order to limit your total loan debt
- Borrow only what you need. You must repay loans with interest which, depending on the type of loan, can begin accumulating immediately upon disbursement of the loan.
- Before you borrow, estimate both the amount of debt you may be able to afford and the potential monthly loan payment you can expect after you graduate. Refer to the calculators on the Direct Loan page of the Federal Student Aid website for sample repayment amounts.
- If you do decide to borrow a loan, Direct Stafford loans have a relatively low, fixed interest rate and are not credit-based.
- Direct Stafford loans provide you with delayed repayment while in-school, and flexible repayment options for when you enter into repayment.
Remember: You are obligated to repay your loan regardless of whether you complete your education, are satisfied with your education, or are able to find a job.
Required Steps for First-Time Borrowers at CSU Long Beach
If you are a first-time Direct Stafford Loan borrower at CSU Long Beach, you will need to
- complete an online Loan Entrance Counseling session, and
- complete an electronic Master Promissory Note
These requirements can be completed online at www.studentloans.gov.
Your loan funds cannot be credited to your account until you have completed both the Entrance Counseling and the Master Promissory Note (and you have accepted your loan).
These steps will only need to be completed the first time you borrow a Direct Stafford Loan at CSULB; you do not need to do them for subsequent years.
Loan Entrance Counseling
Federal regulations require that you complete an entrance counseling session prior to receiving a Federal Direct Stafford Loan. Students at CSU Long Beach complete this requirement online at www.studentloans.gov.
The purpose of the entrance counseling session is to explain your rights and responsibilities as a borrower, to emphasize the legal binding nature of your loan obligation, and to make you aware of the consequences of failing to repay your loan according to the terms of the promissory note.
Steps for Completing Online Loan Counseling:
You will go through a sequence of screens that cover the entrance counseling followed by a 15 question quiz.
- Go to the Direct Loan Counseling site
- Click on “go” under the Entrance Counseling section.
- Click “Tutorial and Quiz” under the Stafford Loan section.
- Complete the Tutorial and Quiz, which will take approximately 20 -30 minutes. Be certain to follow all instructions and to print any and all sections for your records if you desire.
- After completing the Quiz (12 out of 15 questions must be answered correctly to pass), you will need to have the results submitted to CSU Long Beach.
- Enter your full Legal Name, Date of Birth, and Social Security Number in the appropriate boxes.
- Read the Borrower’s Rights and Responsibilities; click “Save and Acknowledge” at the bottom of the page.
- Click on “Add a School.” To have the results sent to us, type in “Long Beach” for the school name and then click on “Search.” You can then select California State University Long Beach from the search results – click on “choose selected school.”
- Highlight California State University Long Beach (in the box), click on “Proceed.”
- You have now completed the Entrance Counseling requirement!
Optional: Once you have completed the Entrance Counseling session, you may print a copy of the Student Borrower’s Rights and Responsibilities for your records. Click on “Show Form for Printing” and use your browser’s print button.
Master Promissory Note (MPN)
The MPN is a legal contract between you and the Department of Education. Your promissory note is a multi-year note that remains valid for 10 years from the date you sign it; it is designed to cover the maximum loan amount you are eligible to receive for all years of enrollment at CSU Long Beach. You will receive a disclosure statement each year identifying the exact amount disbursed to you.
Completing the Online Master Promissory Note:
The MPN is completed online at https://studentloans.gov. You will need to provide the following information when completing the MPN:
- Federal PIN (this is the same one used to electronically sign the FAFSA)
- Your full legal name as it appears on your social security card
- Permanent mailing address
- Driver’s License number and state (if applicable)
- Phone number
- Email address
- Name, address, and phone number for two references. These should be people who have known you for at least one year – preferably relatives – who live at different addresses from one another.
Loan Repayment
After you graduate, leave school, or drop below half-time enrollment, you have a 6-month grace period before your loans enter into active repayment. The repayment period for Stafford Loans varies from 10 to 25 years. Before or during your grace period, you must complete Loan Exit Counseling, which informs you of your rights, responsibilities, and terms of repayment on your loan. You may complete this requirement online or via the mail.
When it comes time to repay your loan, you can choose a repayment plan that is best suited to your financial situation. For descriptions of the various repayment plans, as well as an interactive repayment calculator, refer to the Direct Loan section of the Federal Student Aid website.