Loans

You have a choice about how you pay for your education.

A Minute to Learn It – Borrowing Student Loans

1 min

Play Next

• Applying for a Federal Direct Loan
  1 min
• What is the Annual Student Loan Acknowledgement?
  1:30 min
• What is a Direct PLUS Loan?
  1:10 min
• What is a Parent PLUS Loan?
  1:23 min
• What if I drop a course or withdraw?
  32 sec
• Loan Exit Counseling
  1:06 min
• Federal Student Loan Repayment
  1:04 min
• What is a Private Loan?
  1:16 min

Federal Direct Loans

Federal Direct Loans are money the government lends you to help pay for college. You’ll need to pay it back later, but it can make your goal of going to college possible when you don’t have the full cost upfront.

Here are the basics:

• You borrow the money now.
• Use it to help you pay for things like tuition, books, or housing.
• After you finish college — or if you take fewer than 6 credit hours in a semester — you’ll start paying the money back, little by little.

To apply for a federal student loan, you must first submit a Free Application for Federal Student Aid (FAFSA). Visit Understanding Federal Student Aid to learn more about the different types of federal loans, including Federal Direct Subsidized Loans (government pays interest while you are enrolled) and Federal Direct Unsubsidized Loans (interest accrues immediately).

Direct Subsidized and Unsubsidized Loans

Subsidized Loans are available to undergraduate students who demonstrate financial need. The U.S. Department of Education pays the interest while you are enrolled in at least 6 credit hours, during your grace period, and during approved deferment periods. This means the loan does not accrue interest during those times.

Unsubsidized Loans are available to undergraduate students and are not based on financial need. Interest begins accruing as soon as the loan is disbursed, including while you are in school. You may choose to pay the interest while attending school or allow it to be added to your loan balance.

Both loan types must be repaid after you leave school or drop below 6 credit hours of enrollment. Flexible repayment options are available to help manage your payments.

Students in default on a federal student loan aren’t eligible for loans or other financial aid until the default is resolved.

Requesting a Federal Loan at ICC

Because ICC’s tuition is relatively low, Federal Direct Loans aren’t automatically included in your financial aid offer. If you’ve completed the FAFSA and want to borrow, submit a Loan Request to add them to your aid package. Read “How to Borrow Federal Direct Loans” below.

• How to Borrow Federal Direct Loans

  Important Change for 2026–27 Academic Year

  Beginning with the 2026–27 school year, Federal Direct Loans will no longer be automatically included in any student’s financial aid offer — regardless of SAI.

  Students who wish to borrow Federal Direct Loans will be required to submit a Loan Request Form.

  How to Submit the Loan Request/Adjustment Form

  1.      Log in to your MyICC student portal.
  2.      In the left-hand blue navigation bar, select Financials and open the WorkCenter drop-down menu.
  3.      Click on Loan Request/Adjustment Form, then complete, sign, and submit it.

  After submission, please allow time for processing. Approved loan amounts will appear in your financial aid offer once reviewed.

  First-Time Borrowers

  If you are borrowing federal loans for the first time, you must complete the following at StudentAid.gov:

  • Loan Entrance Counseling
  • Master Promissory Note (MPN)

  These steps are required before your loan can be processed and disbursed.
• Loan Acceptance and Refunds

  You can accept or decline your federal loan for the semester you want to use loan funds.

  Loans will be certified for the amount requested or for the amount you are eligible for, if less than the requested amount. If you are enrolled in fewer than 12 credit hours and/or have a period of enrollment shorter than the full semester, your cost of attendance is adjusted, and your loan award could be recalculated. 

  Any change in your enrollment status (drop, add, or withdrawal) after your loan is certified by ICC may require additional recalculation and revision of your original loan amount. 

  Please refer to your class schedule for the refund dates of your classes.
• Interest Rates & Origination Fees
  • Direct Loan interest rates for undergraduate students in the 2026-27 academic year are 6.52%. Loan origination fees total 1.057%.
  • Direct PLUS Loans disbursed on or after July 1, 2026, and before July 1, 2027, have an interest rate of 9.07%. Loan origination fees total 4.228%
• Lifetime Loan Limits
  • Undergraduate Dependent Students = $31,000 (no more than $23,000 of which can be subsidized)
  • Undergraduate Independent Students = $57,500 (no more than $23,000 of which can be subsidized)
• Summer Enrollment (Trailer Term)

  At ICC, the summer term is treated as a trailer term in the standard academic year loan period. Summer Federal Direct Loan eligibility is based on the same loan period that includes the preceding fall and spring semester.

  If a student has remaining eligibility within that loan period, it may be used for summer enrollment, provided all eligibility requirements are met.

  Summer eligibility is also subject to annual loan limits, remaining eligibility within the loan period, and proration based on enrollment intensity when applicable.
• How Loans Are Disbursed (Paid)

  Loan disbursements are made in two payments during the loan period. If you have requested a two-semester loan (i.e., fall and spring loan), you’ll receive one disbursement in each of the semesters after 30 days from the start of the term. If you want a one-semester loan (i.e., only a fall loan), you will receive two disbursements in the fall semester. The second disbursement is processed after the midterm.

  Per federal regulations, disbursements for first-time loan borrowers are not processed until 30 days after the start of the semester.
• Situations That May Delay or Cancel Your Loan
  • Enrollment in late start (courses taken during the second 8 weeks of the semester) may delay your loan until after these classes start.
  • Changes in your enrollment may require a recalculation of your loan eligibility.
  • Dropping below 6 credit hours will result in the cancellation of undisbursed loan funds.

   
• National Student Loan Data System (NSLDS) Reporting

  Institutions are required to inform prospective student and parent borrowers that federal loans will be submitted to the National Student Loan Data System (NSLDS) and will be accessible by guaranty agencies, lenders, and institutions determined to be authorized users of the data system.
  
  In addition, all student and parent borrowers can access their federal loan history, interest rates and lender contact information on the NSLDS borrower site. 

Annual Federal Direct Loan Limits

Loan Exit Counseling and Repayment

If you’ve borrowed student loans, you must complete Student Loan Exit Counseling once you drop below 6 credit hours at Illinois Central College — whether you’re graduating, withdrawing, dropping courses, or transferring.

Repayment begins 6 months after you fall below 6 credit hours. This grace period is one-time only — if you’ve already used it, repayment starts immediately.

You will receive a notification regarding loan repayment from your loan servicer during your grace period. To look up your loan servicer’s name, contact information, and details on your student loans, go to StudentAid.gov.

• Watch a video about Exit Counseling.
• Watch a video about Loan Repayment.

What if I Can’t Pay Back My Loan?

Student loan default, or failing to repay your student loan debt, carries serious consequences. When taking out a student loan, you want to exhaust all other possible funding methods and borrow conservatively. Students who are in default on their student loans are not eligible for any financial aid until the default is resolved. Defaulted loans prevent students from renewing professional licenses.

The federal government can collect on defaulted loans by confiscating federal tax refunds and wage garnishment. It is the student’s responsibility to stay in contact with the loan servicer to keep their address and enrollment information up to date, which helps avoid default.

If you and your loan servicer disagree about the balance or status of your student loan, and you have done everything you can to resolve the issue, you can contact the Federal Student Aid Ombudsman Group. They can help you find some resolution to the matter.

Please use the following information to contact the FSA Student Loan Ombudsman Group:

US Department of Education
FSA Ombudsman Group

830 First Street, N.E., Mail Stop 5144
Washington, DC 20202-5144

(877) 557-2575
(202) 275-0549 Fax
StudentAid.gov

Cohort Default Rate

A cohort default rate is the percentage of a school’s borrowers who enter repayment on certain Federal Family Education Loan (FFEL) Program or William D. Ford Federal Direct Loan (Direct Loan) Program loans during a particular federal fiscal year (FY), October 1 to September 30, and default or meet other specified conditions prior to the end of the second following fiscal year.

• FY 2019 National Average – 2.3%
• FY 2019 ICC Average – 3.4%

Private Loans

Private loans, also known as alternative loans, provide another borrowing option. Although the FAFSA is not required, private loans may have varying interest rates and limited repayment options. You should consider alternative loans as a “last resort” lending option. Watch What is a Private Loan?

Illinois Central College will certify private education loan requests for any lender you choose. The lender you choose will provide current interest rates, processing fees, and cosigner requirements. The lender determines interest rates for loans based on the student’s and cosigner’s credit. The Financial Aid office does not endorse, recommend, or promote any lender for private loans.