Consumer & Loan Information

The following outlines the steps for securing and managing federal student loans at McMurry University. Students are encouraged to review each stage carefully and borrow responsibly.

1. Apply for Financial Aid

Complete the Free Application for Federal Student Aid (FAFSA). Once submitted, the Financial Aid Office will evaluate eligibility for financial assistance, including grants, scholarships, and federal loans. Students will be notified when their financial aid award package is available.

2. Review Your Award in NetPartner

Access your financial aid award through NetPartner.

When reviewing your package:

• Remember that grants and scholarships do not require repayment.

• You are not obligated to accept the full loan amount offered.

• Consider all available payment options, including grants, scholarships, installment payment plans, tuition prepayment plans, and loans.

• Federal student loans offer borrower protections such as deferment and forbearance options.

Make informed decisions and borrow only what is necessary to meet your educational expenses.

3. Accept, Reduce, or Decline Loans

After reviewing your award, you may:

• Accept the full loan amount

• Accept a partial amount based on your needs

• Decline the loan entirely

To request an adjustment to your loan amount, email the Financial Aid Office at financialaid@mcm.edu.

4. Complete Loan Requirements

Once a loan is accepted, outstanding requirements will appear in NetPartner. These typically include:

• Entrance Counseling

• Signing a Master Promissory Note (MPN)

Loans cannot be disbursed until all required steps are completed.

5. Loan Disbursement

After acceptance and completion of all requirements, loan funds will be applied directly to the student account on the scheduled disbursement date for the semester.

If a credit balance results, students may request a refund through the Student Accounts Office:

• Phone: 325-793-3815

• Email: studentbilling@mcm.edu

6. Monitor Your Borrowing

Students may review their federal student loan history through the National Student Loan Data System (NSLDS).

Through NSLDS, borrowers can:

• View federal loan and grant history

• Access the loan servicer contact information

• Download federal student aid data using the MyData feature

Regular review helps students stay informed about cumulative borrowing.

7. Complete Exit Counseling

Exit Counseling is required when a student:

• Graduates

• Withdraws

• Takes a leave of absence

• Drops below half-time enrollment

This requirement ensures borrowers understand repayment responsibilities and available options.

8. Repayment

Federal loans enter a grace period after a student leaves school. Following the grace period, repayment begins.

Students should:

• Identify their loan servicer

• Establish online account access

• Review repayment plan options

Proactive loan management supports long-term financial success.

In addition to federal student loans, students may explore state-sponsored and private (alternative) loan programs to help cover remaining educational expenses.

Private loans are offered by banks and lending institutions and typically require a credit review. Interest rates, repayment terms, borrower benefits, and eligibility requirements vary by lender. Students are encouraged to carefully compare options and exhaust federal aid eligibility before pursuing private loans.

ELMSelect

McMurry University provides access to ELMSelect, a lender comparison tool that allows students and families to:

• • • Review participating private lenders

    • Compare interest rates and repayment terms

    • Evaluate borrower benefits and eligibility criteria

    • Apply directly with the lender of choice

ELMSelect is designed to support informed borrowing decisions by presenting lender information in a clear, side-by-side format.

Students considering private loans should borrow conservatively and review all terms and conditions before committing to a loan agreement. For additional guidance, contact the Financial Aid Office at financialaid@mcm.edu.

To help you understand key terms related to student loans and financial aid, McMurry University provides a comprehensive Loan Definitions and Glossary.

This resource explains important concepts such as:

• Annual Percentage Rate (APR)

• Deferment & Forbearance

• Grace Period

• Master Promissory Note (MPN)

• Subsidized vs. Unsubsidized Loans

• Servicer

• And more

Review this glossary to make informed decisions about borrowing and managing your student loans.

Student loans must be repaid even if you do not complete your program, are unable to secure employment in your field of study, or are dissatisfied with your educational experience. However, under specific circumstances, federal and state loan programs may offer forgiveness, cancellation, or discharge options.

Types of Forgiveness by Loan Program

Important Considerations

• Forgiveness or cancellation is not automatic. Borrowers must submit a formal application.

• The loan servicer determines eligibility.

• Borrowers will be notified once the request has been reviewed and processed.

• Regular monthly payments must continue until official approval is granted.

Failure to continue payments during review may result in delinquency.

Application Process

Borrowers must contact their loan servicer to begin the cancellation or forgiveness process. A servicer is the organization responsible for collecting payments and managing your loan during repayment.

Federal Direct Stafford or PLUS Loans

Your loan servicer will:

• Confirm eligibility requirements

• Provide the necessary application forms

• Outline documentation requirements

Borrowers can identify their federal loan servicer by accessing their loan information through the National Student Loan Data System (NSLDS).

For additional guidance, students may contact the McMurry Financial Aid Office at financialaid@mcm.edu.

If you are experiencing financial difficulties, there may be options to postpone or reduce your student loan payments temporarily. These options include deferment and forbearance.

Important Information

• Postponement is not automatic. You must submit a completed request to each loan servicer.

• Your servicer will review eligibility and notify you once a decision has been made.

• You must continue making scheduled monthly payments until approval is confirmed.

• During forbearance, you are responsible for paying accrued interest.

• Keep track of the end date of your deferment or forbearance and be prepared for repayment to resume.

Failure to continue payments while a request is pending may result in delinquency.

Deferment

A deferment is a temporary period during which required payments are postponed.

• Interest does not accrue on Subsidized loans during deferment.

• Interest does accrue on Unsubsidized loans and must be paid by the borrower.

Eligibility requirements vary by loan program.

Examples of Deferment (Perkins Loans Only)

Unemployment Deferment
Available if you are unemployed or underemployed (working fewer than 30 hours per week), actively seeking employment, or receiving unemployment benefits.

• Maximum eligibility: 36 months over the life of the loan.

Economic Hardship Deferment
Available if you are working 30 hours or more but experiencing financial hardship.

• Maximum eligibility: 36 months over the life of the loan.

How to Request a Deferment

For Federal Direct Stafford or PLUS Loans:

• Contact your loan servicer for eligibility criteria and application forms.

• You can identify your loan servicer by reviewing your loan details through the National Student Loan Data System (NSLDS).

Forbearance

If you do not qualify for a deferment but are temporarily unable to make payments, you may request a forbearance.

Forbearance allows your servicer to:

• Temporarily reduce payments, or

• Temporarily postpone payments

Interest continues to accrue during forbearance, and you are responsible for paying it.

Types of Forbearance

Discretionary Forbearance
The lender determines whether to approve the request. Common reasons include:

• Financial hardship

• Illness

Mandatory Forbearance
If you meet eligibility requirements, your lender must grant the forbearance. Qualifying situations may include:

• Participation in a medical or dental internship or residency program

• Monthly federal student loan payments that equal 20% or more of your gross monthly income (additional conditions apply)

• Service in a national service position with a national service award

• Teaching service that qualifies for Teacher Loan Forgiveness

• Eligibility for repayment under the U.S. Department of Defense Student Loan Repayment Program

• Activation as a National Guard member by a governor (not eligible for military deferment)

How to Request Forbearance

You must submit a request directly to your loan servicer. In some cases, supporting documentation will be required to verify eligibility.

For assistance identifying your loan servicer or understanding your repayment options, contact your servicer directly or consult NSLDS for updated loan information.

What Is Default?

A loan defaults when a borrower fails to make scheduled payments under the terms of the promissory note.

When Is a Loan Placed in Default?

For most federal student loans, default occurs after 270–360 days of missed payments, depending on the loan type. During this time, the borrower has not made the required payments and has not successfully responded to collection attempts.

What Is a Delinquency Period?

A loan becomes delinquent immediately after a missed payment.

During the delinquency period:

• The lender or servicer attempts to contact the borrower.

• The borrower has an opportunity to resolve the missed payments.

If the loan remains unpaid and the borrower remains unresponsive, it may enter default status.

Repayment Triggers

Repayment typically begins when a borrower:

• Graduates

• Withdraws from school

• Drops below half-time enrollment

Failing to prepare for repayment after these events increases the risk of delinquency and default.

Consequences of Default

Student loans are rarely dischargeable in bankruptcy and may remain the borrower’s responsibility long-term.

If a loan defaults, the borrower may face:

• Immediate demand for full repayment of the outstanding principal and interest

• Loss of eligibility for additional federal student aid

• Accrued late fees, collection costs, attorney’s fees, and additional interest

• Reporting of default status to major credit bureaus (which may impact credit history for up to seven years)

• Wage garnishment (withholding of earnings by an employer at the request of the federal government)

• Withholding of federal payments, including Social Security benefits

Default can significantly affect financial stability and future borrowing opportunities.

How to Avoid Default

Borrowers who are having difficulty making payments should contact their loan servicer immediately. Options may include:

• Changing repayment plans

• Requesting deferment or forbearance

• Exploring income-driven repayment options

Failing to communicate with your servicer may limit your options. The most effective way to avoid default is to make payments on time and communicate early if challenges arise.

If Your Loan Is Already in Default

There are pathways to regain good standing, including:

• Loan Repayment (paying the balance in full)

• Loan Rehabilitation (making a series of agreed-upon payments)

• Loan Consolidation (combining eligible loans into a new Direct Consolidation Loan)

Borrowers are encouraged to contact their loan servicer promptly to discuss available resolution options and determine the most appropriate path forward.

When you graduate, withdraw, or drop below half-time enrollment, your federal student loans typically enter a grace period. During this time, payments are not required.

Grace periods provide borrowers an opportunity to transition into repayment and prepare financially before monthly payments begin.

Prepayment

There are no prepayment penalties on federal student loans. Borrowers may:

• Begin making payments during the grace period

• Pay off loans early without penalty

Making early payments can reduce the total cost of borrowing.

Interest During the Grace Period

Interest treatment depends on the type of loan:

• Subsidized Loans (Subsidized Stafford, Perkins, Direct Subsidized Loans):
  Interest does not accrue during in-school enrollment or the grace period.

• Unsubsidized Stafford Loans and PLUS Loans:
  Interest accrues during school and throughout the grace period.

If unpaid, accrued interest may be capitalized (added to the principal), increasing the total amount repaid.

Making payments during the grace period—particularly on unsubsidized or PLUS loans—can help prevent capitalization and reduce overall loan costs.

For subsidized loans, early payments are applied directly to the principal balance.

Grace Period by Loan Type

* Parent PLUS borrowers may choose, during the application process, to begin repayment immediately or request a deferment while the student is enrolled at least half-time.

Understanding your grace period timeline ensures you are prepared for repayment and positioned to manage your loans strategically.