Navigating Student Loan Options at Virginia Tech

Planning for college expenses is an important part of the college application process. Understanding the available financial aid options is crucial for managing college costs effectively. This article provides a detailed overview of student loan options at Virginia Tech, covering federal and private loans, eligibility requirements, and key considerations for making informed decisions.

Understanding the Cost of Attendance

Knowing what a school costs is the first step in managing college costs. The "Cost of Attendance" (COA) is the total amount of money the average student has to pay, without any financial aid, to attend a particular school. It's essentially the school's sticker price. The Cost of Attendance breakdown for Virginia Tech differs depending on whether you’re an in-state or out-of-state student, with in-state students generally experiencing lower costs for tuition and fees. Because Virginia Tech is an out-of-state public institution for many, the cost can be significantly higher than in-state options.

Virginia Tech's Cost of Attendance (COA) is an estimate of the expenses for a given academic year (fall and spring semesters). It is important to note that this amount is not the amount you will owe Virginia Tech on your student bill. Billable charges, which are part of your Cost of Attendance, consist of tuition, fees, housing, and meal plan, if applicable. Allowances in the Cost of Attendance for food and housing, books and supplies, travel, and personal expenses do not represent actual university charges.

Federal Student Loans

The Department of Education provides federally funded loans to students who complete the Free Application for Federal Student Aid (FAFSA). Virginia Tech uses the FAFSA, along with the General Application in Scholarship Central, to determine eligibility for many scholarships, grants, work-study, and federal loans.

Eligibility and Requirements

To qualify for federal student loans, students must:

Read also: Virginia Peninsula Budget Guide

Be enrolled at least half-time (6 credits) in a degree-seeking program.
Meet Satisfactory Academic Progress (SAP) standards.
Exhibit financial need (for some loans).

Continuing students must also meet Satisfactory Academic Progress standards to maintain their eligibility. Virginia Tech awards financial aid based on the assumption of full-time enrollment (12 credits undergraduate/9 credits graduate). Failure to notify the university of less than full-time enrollment will delay the delivery of financial aid.

Types of Federal Loans

Federal student loans include subsidized and unsubsidized Direct Loans, as well as Federal Parent PLUS and Graduate PLUS loans.

Subsidized Direct Loans: The Department of Education pays the interest on subsidized Federal Direct loans while you are in school at least half-time. Need is determined by comparing the student's Cost of Attendance, Student Aid Index, and any gift aid a student may receive.
Unsubsidized Direct Loans: All degree-seeking students enrolled at least half-time qualify for this type of loan. Interest begins to accrue immediately upon disbursement of unsubsidized loans.
Federal PLUS Loans: These loans are available to parents of dependent undergraduate students (Parent PLUS) and graduate students (Graduate PLUS).

The Department of Education determines federal loan amounts for all qualifying students. All federal loans are subject to a Direct Loan fee (origination fee) and fixed interest rates. A Direct Loan fee (origination fee) is a percentage of your loan amount charged by the lender for the processing of your loan. Federal student loans have an origination fee of approximately \$10 per \$1,000; therefore, the amount you receive as a disbursement will be less than the amount you accept. Fixed means that the interest rate never changes. The interest is calculated as a percentage of the unpaid amount that you borrowed.

Application Process

Loans will initially be offered to students as part of their financial aid package, but the student must accept the loans in their HokieSPA if they wish to utilize the loans. All first-time borrowers are required to complete a Master Promissory Note (MPN) and Loan Entrance Counseling with Federal Student Aid.

The Master Promissory Note (MPN) is a document where a student promises to repay the Federal Direct Loans. The MPN requires an electronic signature. All students who plan to borrow a Federal Direct Loan for the first time through Virginia Tech must complete Entrance Counseling before any Federal Direct Loan funds will disburse to the student's account. The purpose of Entrance Counseling is to provide you (the borrower) with your rights and responsibilities before you borrow a Federal Direct Student Loan. The online session covers the importance of repayment, the consequences of default, and the use of the Master Promissory Note (MPN).

To complete Entrance Counseling, hover over "Complete Aid Process" in the horizontal menu bar at the top of the HokieSPA page. When the menu drops down, select "Complete Entrance Counseling." Select your student type and click the corresponding "Log in to Start" button. You may also view a demonstration video before beginning.

Loan Disbursement and Refunds

If your financial aid does not cover your direct university charges, you are responsible for paying the balance by the date indicated on the e-bill. If your financial aid exceeds your direct university charges, the earliest any excess financial aid may be available as a refund to you is the Thursday prior to the start of classes, assuming full-time enrollment and completion of all financial aid requirements. Students are strongly encouraged to sign up for direct deposit as this is the safest and most efficient way to receive excess funds.

If you accept any federal loan amount, you will receive a notice listing many details of the loan including the estimated disbursement date. You will receive a separate notice from the university when a federal loan (Federal Direct Subsidized/Unsubsidized, Federal Parent PLUS, or Federal Graduate PLUS) disburses to your account.

Private Student Loans

Aside from grants, the other major way to pay for college is with student loans. While federal loans are generally preferred due to their lower interest rates and flexible repayment options, private student loans can be a supplemental option to cover remaining costs. Several private lenders offer student loans to Virginia Tech students.

Private student loans can borrow up to 100% of the cost of attendance of grad school with private graduate student loans.

Managing Financial Aid at Virginia Tech

Virginia Tech provides several resources to help students manage their financial aid effectively.

HokieSPA

HokieSPA is the primary platform for students to view and manage their financial aid. Through HokieSPA, students can:

View their financial aid offer for the current year as well as previous award years.
Accept, decline, or modify (loans and USFA-Administered Scholarships only) financial aid awards.
Complete Entrance and Exit Counseling.
Access the University FERPA Disclosure.

To review your financial aid, start by clicking the "View Your Financial Aid" button located on the financial aid page. The landing page shown after clicking the "View Your Financial Aid" button will display any unsatisfied requirements that must be completed to be awarded with financial aid. This page also shows previous student requirements that have been completed and processed. Here you will see any grants, scholarships, and/or loans offered to you. Click on each award to view the terms of each individual award. This page also displays your expected enrollment status for the term/year and your current Student Aid Index (SAI) as determined by the FAFSA. Finally, the page provides a breakdown of the estimated amount it will cost you to go to school for the designated award year and terms. The COA is broken down between billable (direct costs) and non-billable (indirect costs) items.

Financial Aid Offer

A financial aid offer refers to the combination of various forms of financial assistance offered to a student to help cover the costs of their education. This offer typically includes grants, scholarships, loans, and work-study opportunities. The aim of a financial aid offer is to make higher education more accessible by helping students afford tuition, fees, books, and living expenses.

Your financial aid offer is contingent upon you meeting all eligibility requirements and the availability of federal, state, and institutional funds. Total financial aid cannot exceed a student's Cost of Attendance.

Satisfactory Academic Progress (SAP)

Satisfactory Academic Progress (SAP) is based on your academic performance (GPA) and the completion of the courses you attempt within your program of study.

Additional Resources

Money Matters: Hokies can check out Hokie Wellness Financial Services for everything you always wanted to know about personal finance.
Scholarship Reporting Form: Please complete the Scholarship Reporting Form if you will receive financial aid from any source outside of Virginia Tech.

Understanding Key Financial Aid Terms

Student Aid Index (SAI): The Student Aid Index (SAI), calculated using the information provided on the Free Application for Federal Student Aid (FAFSA), is the amount a family can reasonably be expected to contribute to educational expenses. The Office of University Scholarships and Financial Aid only uses the SAI to determine financial aid eligibility. It is not the amount you must pay. Financial need is determined by subtracting your Student Aid Index from your Cost of Attendance.
Grants and Scholarships: Financial aid that is offered or given that does not have to be paid back. Students will automatically be considered for certain institutional scholarships after submitting the FAFSA and completing the General Scholarships Application in Scholarship Central. Assistantships and fellowships must be factored into your financial aid package per federal student financial aid regulations. If you receive either of these awards we will update your financial aid package which may result in a reduction of aid if you were awarded to your need and/or estimated cost of attendance for the year.
Work-Study: A work program through which you earn money to help you pay for school. You must secure a Federal Work-Study position in order to receive these funds, and the funds will be paid on an hourly wage. Failure to accept the Federal Work-Study award by July 1 will result in cancellation of this aid.

Net Price and Expected Family Contribution (EFC)

The Net Price is the total cost of attending Virginia Tech minus the total aid given (grants and scholarships). In other words, this is the price you have to pay to the school out of pocket. Most schools have an updated Net Price calculator available to provide an estimate.

The US government has a standardized way to calculate how much a typical family can afford to pay without help, known as the Expected Family Contribution (EFC). Colleges use this number as a guideline to decide how much aid to give you, but it's just a guideline.

FERPA and Financial Aid Information

The Family Educational Rights and Privacy Act (FERPA) does not allow the university to release a student’s financial aid information to anyone, including parents, without the student’s permission. If you would like your financial aid information released to certain individuals, including your parents, please complete the University FERPA Disclosure available through your HokieSpa account. If you are a new Hokie, once you accept your offer of admission and set up your VT PID, you should set up a FERPA passcode for yourself and for anyone you wish to grant access to your financial aid information.

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