Federal Student Educational Loans
The U.S. federal government offers several educational loans for
students. Hampshire College, through the U.S. Department of
Education, offers the subsidized Ford Direct loan and the
unsubsidized Ford Direct loan .
Hampshire College also offers a limited number of Perkins loans .
Consolidation loans are available to our students who want to
replace their current variable interest rate loan(s) with a fixed
interest rate loan.
William D. Ford Federal Direct Student
Hampshire College participates in the William D. Ford Federal Direct
Loan Program. Our students do not need to find a bank for a federal
student loan. Students obtain their loans through the college rather
than through private lenders as under the Federal Stafford Loan
Program. We work directly with the federal government to process the
loan paperwork on the student’s behalf. The student’s lender is, and
will remain, the U.S. Department of Education for as long as the
student has the loan. A student may not receive a Federal Stafford
Loan while attending Hampshire College.
Federal Direct loans are in the student’s name only. The student
borrower is solely responsible for the repayment of the loan.
Repayment begins six months after the student leaves school,
graduates, or changes enrollment to less than half-time. This one
time grace period of six months exists for each loan. Students are
responsible to notify the Direct Loan Servicing Center (DLSC) of any
name, address, or phone changes. Students in repayment should
contact the DLSC if they are experiencing any financial problems
which may make them late in making monthly payments.
Total annual Direct loan amounts cannot exceed the following limits
for undergraduate students:
$2,625 for a first-year student,
$3,500 for the second-year, and
$5,500 for each subsequent undergraduate year up to a maximum of
New loan limits beginning July 1, 2007:
$3500 for a first-year student,
$4500 for a second-year student,
limits for third and fourth year-students remain the same.
The average federal student loan debt for our May 2006 graduates was
The interest rate is variable and adjusted annually in July and will
never exceed 8.25%. The rate is set to the 91 day Treasury bill rate
plus 1.7 percent during in-school, grace, and deferment periods and
the 91 day Treasury bill rate plus 2.3 percent during repayment.
NEW INTEREST RATES FOR 2006-2007: Beginning July 1, 2006, interest
rates on Federal Direct loans will no longer be variable. Interest
rates for Direct loans borrowed on or after July 1, 2006 will be
FIXED at 6.8%. Current loans with variable rates will continue to be
variable, with rates changing annually on July 1, unless the loan is
consolidated into a fixed rate.
There are two types of Direct loans: subsidized and unsubsidized. A
Direct loan may have a portion which is subsidized and a portion
which is unsubsidized. Students should refer to their recent
financial aid award letter for the amount(s) and type(s) of Direct
loan received. Students will be notified by the student financial
services office of any change in the loan amount or type.
Borrowers will receive a disclosure statement from the Loan
Origination Center (LOC) listing the amount borrowed, interest rate,
type of loan, and fee & rebate amounts. This document is sent to the
borrower’s home address and should be kept for future reference.
for borrowing a Federal Direct Loan
Federal Perkins Loans
Perkins Loans are federal loans and the funds are allocated directly
to colleges and universities to lend to students. Students with high
need are awarded this loan as part of their award packages. The
funds are very limited and priority is given to students with high
need in their third or fourth year of enrollment. The annual loan
limit is $4,000, with an aggregate of $20,000 for undergraduate
education. The loan will be credited directly to the student’s
Hampshire account each semester after the promissory note is signed.
Students apply for this loan by completing the Free Application for
Federal Student Aid (FAFSA) .
Repayment of principal and interest is deferred during a grace
period of nine months after the student graduates or ceases to be
enrolled at least half time, whichever occurs first. The interest
rate is 5 percent on the unpaid balance. Previous borrowers continue
under the provisions of their first Federal Perkins or National
Direct Student Loan.
The repayment period extends up to ten years and depends on the
amount of debt, but the minimum repayment is $40 per month.
Repayment of principal and interest is deferred while the student is
enrolled at least half-time; enrolled and attending a graduate
fellowship program; engaged in graduate or postgraduate fellowship
supported study (such as Fulbright) outside the U.S.; enrolled in an
approved rehabilitation training program for disabled individuals;
seeking and unable to find full-time employment; suffering an
economic hardship; or engaged in services that qualify for
cancelation of the loan. Previous borrowers continue under the
deferment provisions of their first Federal Perkins Loan or National
Direct Loan as well.
First time Perkins loan borrowers must make an appointment with the
Perkins loan coordinator in the business office. The Perkins loan
coordinator conducts individual entrance and exit counseling
There are several cancellation provisions for Perkins loan
Any questions regarding Perkins loan repayment, loan cancellations,
or deferments should be directed to the college's Perkins loan
coordinator, at (413) 559-6086.