Navigating Student Loans in Arizona: A Comprehensive Guide for Graduate and Professional Students

Securing higher education in Arizona, particularly at institutions like A.T. Still University (ATSU), often involves careful financial planning, with student loans playing a significant role for graduate and professional students. Understanding the intricacies of federal and private loan options, eligibility requirements, repayment structures, and potential forgiveness programs is crucial for managing educational debt effectively. This guide aims to provide a detailed overview of student loan information relevant to students in Arizona, with a particular focus on those pursuing advanced degrees.

Federal Direct Student Loans at ATSU: Eligibility and Application Process

ATSU graduate and professional students seeking degrees in eligible programs may qualify for a Direct Unsubsidized and/or a Direct Grad PLUS student loan. Obtaining a Federal Direct Student Loan at ATSU involves a few key steps, from confirming eligibility to completing the FAFSA and reviewing your financial aid offer.

Before applying for a Federal Direct Student Loan, it’s important to ensure you meet the basic eligibility requirements. These criteria help determine who can borrow federal funds to support their education and ensure you stay on track with your academic and financial responsibilities. A cornerstone of this process is the Free Application for Federal Student Aid (FAFSA®). The FAFSA is available to file for the upcoming academic year beginning on October 1st annually. While ATSU does not have a formal deadline for FAFSA completion, ATSU Enrollment Services recommends filing between October and December. It is imperative to note that students must complete a new FAFSA prior to the start of each academic year.

Your financial aid offer, once you are deemed eligible, will include academic expenses for the loan period. These typically encompass tuition and fees, essential educational materials such as computers, books, and supplies, as well as estimated living expenses.

Understanding Loan Terms: Interest, Grace Periods, and Repayment

For Federal Direct Unsubsidized and Direct Grad PLUS student loans, interest begins accruing for the borrower when funds are disbursed. For the 2025-2026 academic year, the interest rate for Direct Unsubsidized loans will be fixed at 7.94% throughout repayment. Borrowers of this loan have a six-month grace period. Under a standard repayment plan, borrowers have up to 10 years to repay this loan, though numerous repayment plan options exist for further research and consideration.

The Grad PLUS Loan program, while also offering federal funding, has its own set of terms. Interest for Grad PLUS loans also begins accruing upon disbursement, with a fixed rate of 8.94% for the 2025-26 year. Similar to the Unsubsidized loan, borrowers using a standard repayment plan have up to 10 years to repay this loan, with a variety of repayment plans available.

Upcoming Changes to Federal Loan Programs

Significant changes are on the horizon for federal student loan borrowing limits for graduate and professional students, proposed by the recently-passed One Big Beautiful Bill, set to begin on July 1, 2026. A notable alteration is the discontinuation of the Grad PLUS Loan program for new borrowers starting July 1, 2026. However, students who have already borrowed federal loans, including Grad PLUS, for their current degree program before this date may continue borrowing under the existing terms and limits. This provision allows for continued borrowing for up to three (3) additional years or until their expected graduation date, whichever comes first.

Exploring Additional Funding: Private Loans and Creditworthiness

Students who find that federal loans do not cover all their educational expenses may explore private student loan options. Approval for both Grad PLUS and private loans is contingent upon a borrower not having an adverse credit history. ATSU will provide specific instructions within your financial aid offer on how to grant consent for a check of your credit history. For new Grad PLUS borrowers who have never borrowed this type of loan at ATSU, a new consent form is mandatory.

Disbursement and Management of Loan Funds

For both Direct Unsubsidized and Direct Grad PLUS student loans, funds are electronically transferred to the student’s account at ATSU, typically upon disbursement for the semester. When student loan funds exceed the amount due to ATSU, this creates a Title IV credit balance. This credit balance is then promptly provided to the student via direct deposit or by check. To facilitate direct deposit, students can submit the ATSU Authorization for Direct Deposit Form, accessible through the ATSU Portal, to Student Accounts.

Every ATSU student who matriculates earns a portion of the Title IV, HEA funds from day one of their enrollment. In cases where a student withdraws before Title IV funds are disbursed, and has requested loan funds, they will be provided with a post-withdrawal disbursement notice in writing within 30 days of ATSU determining the student's withdrawal. Students will be required to confirm how much, if any, of this post-withdrawal disbursement they wish to receive.

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Managing Borrowed Funds: Overestimation and Enrollment Changes

Enrollment Services strongly encourages students to plan ahead, budget responsibly, and borrow only the loan money that is genuinely needed. However, if a student overestimates their needs and borrows too much loan money, they may return the excess funds to ATSU by writing a check for the amount they wish to return to the lender. Enrollment Services will then return these funds on the student’s behalf and request that the associated fees and interest charges be waived, although this waiver is not guaranteed.

Changes to a student’s enrollment status, such as adding or dropping courses, falling below half-time enrollment, or withdrawing from a program, will necessitate a review of their financial aid offer. In situations where an over-award occurs (meaning a student has received more financial aid than they are eligible for), Enrollment Services will review the student’s financial aid file. Adjustments are typically made by reducing a subsequent loan disbursement. In rare instances, a student may be required to write a check to the lender to repay an over-award. To expedite the review process, it is advisable to include the net amount you wish to borrow (the actual total amount you wish to receive) when communicating with Enrollment Services.

Cost of Attendance (COA) and Expense Adjustments

A program budget, or Cost of Attendance (COA), is prepared annually for each program approved to certify for Title IV funding, as mandated by Department of Education regulations. The expenses included in the COA are based on what is deemed necessary for a student to attend school and generally consider costs for a single student.

However, there are times when unusual or extenuating circumstances arise during an enrollment period that generate expenses not covered in the standard COA. Students may request an increase in their COA by reporting these expenses, supported by documentation, for consideration. All submitted expenses must have been incurred during the enrollment period and guaranteed prior to the last date of that period. Specific categories for COA adjustments include:

Child daycare costs: These costs must directly correlate to a student’s ability to attend school-required activities.
Unplanned/emergency medical or dental expenses: Requests for increases to cover costs associated with unplanned medical or dental expenses should be required for the student and eligible for coverage by the student’s health insurance policy. Elective, preventative, and cosmetic procedures do not qualify.
Unexpected transportation expenses: Requests for reimbursement of unexpected transportation costs must be for a vehicle that a student uses to attend school-related activities. Invoices and/or receipts must be provided with the request.
Other: Special circumstances that create an unexpected financial need not fitting into the above categories may also be submitted. Examples include required board programs not already covered, or higher health insurance costs due to a student-specific situation.

It is important to note that travel for institutes may be requested up to an additional $1,355, and this is a request the student must initiate. Students can download an expense worksheet to calculate how their estimated Cost of Attendance aligns with their actual costs.

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Need-Based vs. Non-Need-Based Aid at ATSU

Need-based loan offers take into consideration the Expected Family Contribution (EFC) or Student Aid Index (SAI), which is calculated using data from a student's FAFSA. ATSU, however, offers non-need-based loans, meaning the EFC/SAI does not impact the amount of loans offered. ATSU is also approved to offer Federal Work-Study, which is a need-based program.

Satisfactory Academic Progress (SAP) and Loan Requirements

According to United States Department of Education regulations (34 CFR 668.16 and 668.34), all students receiving federal financial assistance must meet and maintain satisfactory academic progress (SAP). SAP is a set of standards students must adhere to in order to continue receiving federal financial assistance.

Furthermore, students must complete entrance counseling upon matriculation at ATSU before any loan funds will be disbursed. Institutions are required to provide students with information published by the Department of Education whenever information regarding loan availability is provided. This publication includes details about the rights and responsibilities of students and institutions under Title IV, HEA loan programs. Entrance and exit counseling, as long as the school controls the counseling and it does not promote specific lenders, are integral parts of this process.

Verification of FAFSA Data

Each year, applications for federal student aid are selected for verification by the Central Processing System (CPS) to confirm the accuracy of the data submitted on the FAFSA. If verification is required and the IRS Data Retrieval Tool was used during electronic FAFSA completion (and the tax return has not been amended), a tax return transcript from two years prior will not be necessary. Until verification is complete, students cannot receive any federal need-based aid, including Federal Work-Study. After verification, ATSU will process any necessary corrections based on the documentation received. In instances where a correction is needed as a result of verification, students will receive notification from CPS regarding changes to their Student Aid Report.

Enrollment Services maintains a referral policy, as mandated by the federal government, for suspected or actual cases of fraud or abuse. Students who intentionally submit fraudulent information will be investigated, and all such cases must be reported to the appropriate authorities.

Debt Management and Loan Repayment Resources

Students are reminded that they must repay all loans according to the terms outlined in their promissory note. The ATSU Doctor of Osteopathic Medicine programs are accredited by the Commission on Osteopathic College Accreditation (COCA). As part of maintaining this accreditation, ATSU commits to educating students through counseling on financial aid and general debt management.

Several resources are available to assist students with loan repayment:

National Health Service Corps Loan Repayment Program: This program offers loan repayment assistance to licensed primary care medical, dental, and mental and behavioral health providers who commit to serving in communities with limited access to healthcare.
Arizona State Loan Repayment Program: This program provides loan repayment in exchange for a commitment to work for two years in a public, private non-profit, or rural private practice located in a federally designated Health Professional Shortage Area or an Arizona Medically Underserved Area.
Paul Garrard: A recognized expert in student loan debt management, particularly within the medical and health professions, Paul Garrard is a member of the American Dental Education Association (ADEA) and the Financial Planning Association (FPA). His insights can be invaluable for navigating complex debt scenarios.

Other Financial Assistance (OFA) and Scholarships

Other Financial Assistance (OFA) encompasses any financial aid paid due to a student’s enrollment at ATSU or specifically to cover educational expenses. OFA includes scholarships, grants, net earnings from need-based employment, or loans received from Federal, State, institutional, or other sources for a specific enrollment period.

Scholarship programs with a service commitment, such as the National Health Service Corps Scholarship Program (NHSC), the Health Professions Scholarship Program (HPSP), Indian Health Services Scholarship (IHS), and the Native Hawaiian Health Scholarship Program (NHHSP), offer recipients funds to cover expenses included in the Cost of Attendance (COA). These benefits can be used for institutional charges, health insurance, books, exams, travel, or even a monthly living stipend. All such financial benefits are considered OFA and must be included in a student’s financial aid offer for the academic year. Students should promptly notify ATSU Student Accounts upon acceptance into one of these programs. The value of each scholarship program varies and is typically identified within each program's COA or set by the scholarship provider.

Federal Direct Loan Dates and Adjustment Procedures

For the Fall 2025-Spring 2026 academic year, federal loans can generally be accepted starting in mid-July for the following academic year (fall and spring semesters) and must be accepted by the last day of the semester in which the student is enrolled. Eligibility for loan funds ceases if a student withdraws or their enrollment status drops below half-time, provided the loans were not accepted before the enrollment change. Federal Direct Loans accepted after certain priority deadlines may not be processed. It is crucial for students to review important dates to ensure the timely processing of their direct loan funds. Students and parents must accept Federal Direct Loans before the end of the academic term for which they are registered.

If a student has accepted a loan and wishes to increase or decrease the amount, they can visit the student aid adjustment page to submit an aid adjustment form. To increase a loan amount, select the aid type, then "Increase," and indicate the amount already accepted and the desired new total. Information on accepted loan amounts can be found in the Financial Aid and Scholarships box in My ASU. Eligibility for loan amounts can be viewed on the student aid adjustment form or by visiting the studentaid.gov loans page.

Loan Limits and Borrowing Considerations

While student loans represent an investment in future earning potential, it is essential to borrow only what is needed. The interest rates on federal loans are fixed from the date of borrowing and are typically significantly lower than those of private student loans. Once a decision is made to accept or decline loans, students can log into My ASU to do so for Federal Direct Subsidized or Unsubsidized loans. Dependent students will require their parents' information to submit the FAFSA and receive federal student loans. Private student loan requirements vary by lender.

The following chart outlines annual and aggregate borrowing limits for different student populations:

Student Population	Current Borrowers*	New Borrowers Starting July 1, 2026
Undergraduate	Up to total cost of attendance minus any financial aid; No limit on PLUS Loan; $57,500 combined for Sub/Unsub	$20,000 for PLUS Loan; $65,000 for undergraduate aggregate limit (combined subsidized and unsubsidized loans)
Graduate and Professional	Based on academic level for Unsubsidized; No limit for PLUS Loan; $20,500 for Unsubsidized; $138,500 graduate aggregate limit	$20,500 for Unsubsidized Loan (no changes); $100,000 for graduate aggregate limit; $200,000 for professional aggregate limit. Grad PLUS Loan eliminated.

*Legacy provision: If a borrower has a GradPLUS loan made before July 1, 2026, while enrolled in a credential program, they can continue to borrow for 3 academic years or the remainder of their expected time to credential, whichever is less.**The definition of professional programs is being determined.*Also applies to dependent undergraduate students whose parent was denied a PLUS loan and post-baccalaureate students.† As of the 2012-2013 academic year, subsidized loans are no longer awarded to Graduate students.

For more detailed information on student loan limits, visiting the federal student loan limits page is recommended. The process begins with submitting the FAFSA to determine federal loan eligibility, followed by a decision on the amount to borrow, emphasizing borrowing only what is necessary.

Specific Loan Programs and Institutional Responsibilities

Arizona State University (ASU) manages certain loan programs directly. For instance, the Perkins Loan program is managed by the Bursar's Office, with repayment to ASU occurring after the loan enters repayment status (typically nine months post-graduation, withdrawal, or dropping below half-time enrollment). Monthly payments are dependent on the loan amount and repayment period length and can be made online. Detailed information on Perkins Loan repayment can be found at tuition.asu.edu/perkins-loan-repayment.

Other Federal & Institutional Loans managed by the Bursar's Office include Perkins, Health Professions, Nurse Faculty, MANN, ARMAN, OY, and Dougherty Loans. Heartland ECSI is the third-party billing provider for these loans at the University of Arizona.

Recipients of these specific loans are required to complete an exit interview before leaving the University of Arizona. This requirement also applies if a student withdraws or falls below six (6) credit hours. Students will be contacted by Heartland ECSI with instructions on completing the exit interview, or they can contact the institution directly. Exit interviews must be completed online at Heartland ECSI, using the school code U6. Student accounts will be placed on hold (BSL) until the exit interview is completed and received.

Income-Driven Repayment Plans and Future Borrowers

A new income-driven student loan repayment plan is set to take effect in the summer, impacting borrowers in certain existing plans who will need to make new choices. Starting July 1, the Repayment Assistance Plan (RAP) will become the default repayment option for new student loan borrowers. RAP ties monthly payments to 1-10% of a borrower's adjusted gross income and features no negative amortization (meaning the loan balance cannot grow) and includes a $50 monthly principal reduction subsidy. The trade-off is a 30-year repayment plan, compared to 20- or 25-year terms on existing plans.

Borrowers currently enrolled in the SAVE student loan repayment plan will be required to choose a new repayment plan in the coming months. While the official timeline is pending guidance from the Department of Education, current options include the income-based repayment plan.

Student Loan Forgiveness Programs in Arizona

With the increasing average student loan debt in Arizona, understanding available forgiveness options is critical. Arizona offers targeted loan forgiveness programs for residents in specific professions, in exchange for commitments to critical service.

Arizona State Loan Repayment Program (ASLRP): This program provides up to $50,000 in loan forgiveness for two years of full-time service or $25,000 for part-time service. Eligibility is verified by license and employment in a Health Professional Shortage Area (HPSA). Applications are submitted through the Arizona Department of Health Services, with careful tracking of service hours required.
State-Based Assistance Programs for Student Loans:
- AzLEAP (Arizona Leveraging Educational Assistance Program): This grant program aims to help low-income students reduce their reliance on student loans. Grant amounts vary based on funding and financial situation. To qualify, students must submit a FAFSA to establish financial need and then contact their school’s financial aid office to apply for AzLEAP funding.
- Legal Legacy Loan Repayment Program (LRAP): This program supports legal professionals in Arizona by offering loan repayment assistance to those who commit to providing legal services in public interest law. It's important to note that while Joyce Holsey’s LRAP is currently not accepting applications, it has reopened in the past and may do so again. Staying informed about program status is key.

Federal Student Loan Forgiveness Programs for Arizona Residents

Federal programs also offer avenues for loan forgiveness that can benefit Arizona residents, particularly those in healthcare and education. These programs often require service commitments in underserved areas or specific professional roles.

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