When it comes to covering educational costs, loans are a valuable resource for students. It is important to know that both federal and private loans must be repaid after graduation, ceases enrollment, or falls below half-time enrollment. North Central participates in the direct loan program through the federal government. We also accept loans from private lending institutions.

Federal loans have significant advantages over private loans, including fixed low-interest rates and favorable repayment terms.

Direct Loans

Federal Direct loans are offered to students through the federal government's Direct Loan Program 

Subsidized: Awarded to students with financial need. You’re not charged interest while registered as a student (at least half-time). The federal government subsidizes or pays the interest during this period.

Unsubsidized: Awarded to students without financial need (you still must file for financial aid by submitting the FAFSA form). You’re charged interest from the time the loan is disbursed until it’s paid in full. You may choose to pay the interest while in school, or if you don’t, the interest will accumulate and be added to the loan principal balance.

Annual Loan Limits

First year (less than 28 credits completed) $5,500 (up to $3,500 may be subsidized ) $9,500 (up to $3,500 may be subsidized )
Second year (28-59.99 credits completed) $6,500 (up to $4,500 may be subsidized) $10,500 (up to $4,500 may be subsidized)
Third and fourth year (60+ credits completed) $7,500 (up to $5,500 may be subsidized) $12,500 (up to $5,500 may be subsidized)
Teacher Certification students $7,500 (up to $5,500 may be subsidized) $12,500 (up to $5,500 may be subsidized)
Graduate $20,500

Note: Federal guidelines determine the combined maximum loan amounts per academic year for both types of Direct loans.

Important facts

  • Loan eligibility will be determined as part of your financial aid offer.
  • The interest rate will be fixed and are set each year by the U.S Dept. of Education.
  • At the time of disbursement, the U.S. Dept. of Education will deduct an origination fee.
  • Federal Direct Loan interest rates and origination fees are available through Federal Student Aid.

Combined cumulative borrowing limits (Aggregate loan limits)

Dependent undergraduates $31,000 (up to $23,000 may be subsidized)
Independent undergraduates $57,500 (up to $23,000 may be subsidized)
Graduate students $138,500 (including undergraduate borrowing - up to $65,500 may be subsidized)


Disbursement of funds

We participate in electronic funds transfer (EFT) and will deposit your loan funds directly to your student account. Any funding in excess of your bill with the Office of Student Accounts will be refunded to you per your refund selection. Contact Student Accounts for refund method options.

Loan Requirements

Federal regulations require all borrowers to complete a Master Promissory Note (MPN) before disbursing funds to your account. The MPN is your legal obligation to repay all Direct loans you borrow within a 10-year period.

Federal regulations require all schools to provide entrance counseling to first-time borrowers. This online session provides you with information about the loan program and your rights and responsibilities as a borrower.  It must be completed prior to the disbursement of any loan funds.

If you receive a loan, federal law requires you to complete exit counseling once you drop below half time status. This online session informs you about the repayment process.


Federal Direct Parent & Graduate PLUS Loans

  • Parent PLUS is available to parents of dependent undergraduate students and Graduate PLUS is available to graduate students
  • Credit approval is required PLUS Loans and is contingent on non-adverse credit history. Credit approvals last 180 days.
  • Loan amount is limited to the difference between the cost of attendance minus all other financial aid.
  • Interest rate is determined annually and capped at 10.5%.
  • At the time of disbursement, the U.S. Dept. of Education will deduct an origination fee.
  • North Central requires a PLUS application each year.
  • Repayment begins within 60 days after the final disbursement of the year.

Alternative/Private Loans

Alternative loans, also called private loans, are offered by lending institutions to assist students and their families cover educational costs not met by other types of financial aid. These loans are not part of the federal loan program, so we recommend exhausting all other financial aid resources before applying. An alternative loan can be offered up to the cost of attendance minus any other financial aid already received. Loans are generally based on credit worthiness and ability to repay. For many alternative loans, the student is the borrower and will require a U.S. cosigner.

North Central College does not promote or endorse any loan lender, nor does the college have any financial interest in any lending institution. Students and their families have the right to select the educational loan provider of their choice.  ELMSelect is a loan comparison tool that assists borrowers in selecting an alternative loan. Please review lender information carefully and contact the lender with questions.

Things to consider when choosing an alternative loan

  • What is the lowest interest rate and fee combination and how do I qualify? Is the rate only for a limited period or is it for the life of the loan?
  • Is there a limit on how high the variable rate can change? How often does the interest rate adjust and how is the rate determined?
  • What are the repayment terms? Is there any penalty for paying the loan off early?
  • When do I have to start making payments? If payments begin while in school, can I defer and if so, for how long?
  • What proportion of borrowers qualify for the offered discounts? Are the discounts guaranteed or are they subject to change later?