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Student Loan Update Recently you may have heard or read that there could be a national or state shortfall of educational loan funds for the 2008-2009 academic year. The University of Iowa wants to assure you that there is no shortfall of Federal Direct Loan funds for students enrolling at the University of Iowa for the 2008-2009 academic year. There are three important pieces of information that the University of Iowa Office of Student Financial aid would like you know related to this issue.
- The UI participates in the Federal Direct Loan Program. This means that UI students borrow directly through the federal government as opposed to borrowing through a private lender. Federal Direct Loans are available to all students who apply for financial aid by completing a Free Application for Federal Student Aid.
- Parents of undergraduate dependent students may also borrow directly through the Federal Direct Loan Program. This program is called the Federal Direct PLUS loan and the source of funding, as with the student loans, is the federal government.
- Some students and parents in the past have opted not to apply for the Federal Direct Loans referenced above and have chosen to secure funding through a private source. Though there likely will continue to be alternative loans available through private lending sources, the UI has always strongly encouraged its students and parents to make sure they have exhausted all federal loan sources first.