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Loan Programs

Tips for smart borrowing

Never borrow more than you need -- An education loan may be an option you have, but make scholarships, grants, savings, and money you earn your first choice in paying for college.

Figure out a budget before you borrow -- Using a budget will help you plan and limit your borrowing. A budget also helps you think ahead, so you can retain enough borrowing power to help pay for things you may need after college, such as a car or furniture. Many helpful budget guides can be found in bookstores or online.

Stay in touch with your lender -- Open your mail and read all correspondence related to your loan! Do not leave mail unopened. You may miss important information and deadlines. Keep your official loan documents and other important information organized.

Meet the players in the FFELP federal loan process

The Federal Government plays a key role in education lending throughout the Federal Family Education Loan Program (FFELP). These loans are made by lenders. The federal government guarantees the loan in case of default. See also Guarantee Agency.

The Financial Aid Office at Embry-Riddle Aeronautical University works with you and your parents to determine eligibility based on federal guidelines for different types of financial aid such as scholarships, grants, work-study, loans and more. The Financial Aid Office also certifies or approves your federal loan application and the amount you can borrow.

The Electronic Loan Processor is selected by the Financial Aid Office to process all Federal loans on behalf of the University and its students. The electronic loan processor selected by the University is Nelnet. Nelnet provides the following: Online Entrance and Exit Counseling; Online Loan Applications; and disbursal of loan proceeds to the school on behalf of the lenders.

A Guarantee Agency verifies your eligibility for a particular federal loan program and provides the insurance for those loans. If you do not repay your loan, the guarantee agency will pay the lender with funds received from the federal government and collect the balance directly from you.

A Lender actually provides the funds. The lender may be a bank or other financial institution.
The lender electronically transfers funds to Nelnet. This money is applied first to any balance due on your student account. Any excess funds are given to you.

A Servicer is a company contracted by a lender to handle administrative aspects of the loan such as collection of payments, correspondence with borrowers, address changes, loan status updates and more. It is important to know the name of your servicer since quite often all communication regarding your loan will be with the servicer.