Lori Meadows
Indiana University-Purdue University-Indianapolis (IUPUI) offers a range of student loans to help students pay for their education. The university recommends that students first consider federal loans, which are usually more affordable and allow students to postpone repayment until after graduation. Federal loans are available to parents and graduate students, with lower interest rates and more favourable terms. Undergraduate and graduate students can also access subsidised and unsubsidized loans, while students in the IU School of Nursing or pursuing a D.D.S. or M.D. may be eligible for specific loan programs. Private student loans are another option, but these typically have higher interest rates and require a good credit history or co-signer. Students should borrow only what they need and consider the repayment terms, including the potential for loan consolidation to simplify multiple loan payments.
| Characteristics | Values |
|---|---|
| Loan types | Federal Direct PLUS loans, Federal Direct Subsidized and Unsubsidized loans, Federal Nursing Loans, Health Professions Student Loans, Private student loans |
| Who can apply | Parents, graduate students, undergraduate students |
| Interest rates | Variable, depending on credit history |
| Repayment | Students should be careful not to borrow more than they can repay. Federal loans allow repayment after graduation. Private loans may require repayment before graduation. |
| Payment methods | Credit or debit card, electronic check (e-check), US mail, electronic transfer, in person |
| Currency | International students can pay in their own currency using Flywire, PayMyTuition, or Convera |
| Exchange rate | Competitive, with no transaction fee for IUPUI students |
| Payment address | IU Indianapolis Lockbox Payment Processing Center, P.O. Box 6020 Indianapolis, IN 46206 |
| Student ID | Include 10-digit university ID number on checks |
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What You'll Learn
Payment options: online, in person, via mail, or through a payment plan
Students at IUPUI have a variety of options to pay their student loans. These include online, in-person, via mail, or through a payment plan.
Online
Students can pay their bills online via credit or debit card, or via electronic check (e-check). However, if you use a credit or debit card, you will be charged a convenience fee of 2.85% (subject to change), whereas there is no charge for paying by e-check.
In Person
Payments can be made in person with representatives at the Payment Center or placed in the lobby dropbox. These checks will be converted into an electronic payment format.
Via Mail
To mail your payment, print a copy of your bill and mail it along with your check or money order to the following address:
IUPUI Lockbox Payment Processing Center
P.O. Box 7245
Indianapolis, IN 46207-7245
Make your check, money order, or cashier's check payable to Indiana University. Checks and money orders must be payable in U.S. dollars and drawn on a U.S. bank. Make sure the student’s name and 10-digit university ID number are included in the memo section of the check.
Payment Plan
IUPUI has partnered with NelNet Campus Commerce to let you pay your balance over time with a payment plan. This option allows you to pay off your account in up to four payments over the term, depending on when you enroll in the payment plan. To be eligible, your account balance must be greater than $500. When you enroll, you'll pay the down payment fee plus a $60 enrollment fee.
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Federal vs private loans: pros and cons
Federal student loans are issued by the US Department of Education and offer several benefits that make them the first choice for most students. They are generally more affordable and accessible for borrowers, with lower interest rates and multiple repayment plans. They also come with more borrower protections, such as deferment, forbearance, income-driven repayment plans, and student loan forgiveness. Federal loans do not require a credit check, so they won't affect your credit score, and qualifying for them is relatively simple. However, they have limited loan options and borrowers must pay an origination fee.
Private student loans, on the other hand, are provided by banks, credit unions, and other financial institutions. They offer more flexibility, allowing borrowers to choose their lender and repayment terms. Private loans can also bridge funding gaps for students who have maxed out their federal aid or don't meet the eligibility requirements for federal loans. However, private loans typically have higher interest rates and lack the same borrower protections as federal loans. They may also require a credit check, and a cosigner may be needed unless the borrower has a strong credit history.
In summary, federal student loans are generally the smarter first choice due to their lower costs, increased flexibility, and borrower protections. Private student loans can be a good option for those who need additional funding beyond what federal loans can provide or for those who don't meet the eligibility requirements for federal aid. However, private loans tend to be less flexible and more expensive overall.
When deciding between federal and private student loans, it's important to consider the cost of each option in the short and long term, as well as your financial health, the amount you need to borrow, and how quickly you anticipate paying back the loan. It's also crucial to understand the terms and conditions of each loan type and to consider consulting with a financial advisor to make sure you fully comprehend the differences.
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How to apply for a loan
IUPUI provides a range of federal and private student loan options. Before applying for a loan, it is recommended that you review your options for a federal loan. Federal loans usually offer lower interest rates and more favourable terms. They are also usually much more affordable. Federal Direct PLUS Loans and Federal Direct Unsubsidized Loans are available to undergraduate and graduate students. Federal Nursing Loans are available to students pursuing a degree in the IU School of Nursing. Students working toward a D.D.S. or an M.D. may be eligible for a Health Professions Student Loan.
If you are unable to secure a federal loan, you may consider taking out a private student loan. Private student loans can be obtained from banks, credit unions, or other lenders. Private loans require that you have a good credit history or a co-signer with a good credit history. Private lenders must comply with the Truth in Lending Act requirements, which include providing three separate loan disclosures and a signed self-certification form to the borrower. You can use IU Indianapolis' INvestEd Marketplace or ELMSelect tools to compare rates from multiple lenders.
If you are still deciding how much to borrow, it is recommended that you borrow only what you need to cover your education costs. You can use the Net Price Calculator to estimate your need. It is important to keep in mind that the maximum amount you are eligible to borrow may be more than you are able to repay.
To apply for a federal loan, you must complete the FAFSA to see if you qualify. To apply for a private loan, you must submit a Private Loan Counseling Form. You should begin the application process 4 to 6 weeks before you need the funds.
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When to start paying back loans
When it comes to paying back your student loans from IUPUI, there are a few things you should know and consider. Firstly, it's important to understand the difference between federal and private student loans, as the timing of repayment can vary.
With federal student loans, you generally have more flexibility. Federal Direct Subsidized Loans, for example, are available to undergraduate students with demonstrated financial need. With this type of loan, the US Department of Education pays any interest that accrues while you're enrolled at least half-time, for six months after you graduate, and during any deferment periods. This means you won't have to start repaying your loan until after graduation, giving you some breathing space.
On the other hand, with Federal Direct Unsubsidized Loans, you are responsible for all the interest that accrues. While you still won't have to begin repayment until after graduation, the interest will be capitalised, increasing the loan principal. This means that each time interest is calculated, it will be based on a larger amount, potentially increasing your overall repayment amount.
Private student loans, on the other hand, often require a good credit history or a co-signer with good credit. The interest rate on these loans is variable and depends on your or your co-signer's credit history. Private loan lenders may require you to start repaying the loan before you finish your education, so it's important to carefully review the terms and conditions of any private loan before committing.
Additionally, if you have multiple federal student loans, you may be able to consolidate them into a single loan with a fixed interest rate and a lower monthly payment. However, this could result in an earlier repayment start date and the loss of certain discharge benefits.
Finally, remember to borrow only what you need and carefully consider your ability to repay. The maximum amount you're eligible to borrow may exceed what you can realistically repay, so it's important to plan ahead and make informed decisions about your financial future.
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What to do if you can't pay
If you're having difficulty making your current federal student loan payments, there are other repayment plan alternatives to consider. Contact your loan servicer for details. If you have more than one federal student loan, you may be able to consolidate them into a single loan with one monthly payment. This payment can be much lower than your total monthly payments on multiple loans.
Consolidation has its pros and cons. On the one hand, there is the likelihood of lower monthly payments and flexible repayment options, and a fixed interest rate for the life of the loan. On the other hand, if you extend your repayment period, you may pay more interest over time, and you may have an earlier repayment start date if you consolidate during the loan's grace period. Once a consolidation has been completed, it cannot be reversed—the original loans no longer exist as they are paid off by the consolidation.
If you don't pay back a loan according to the terms of the Master Promissory Note (MPN) you signed, you may default on the loan. Default occurs if you don't pay on time or if you don't comply with other terms of your MPN. If you default on a federal loan, the government may take serious actions against you, such as applying your lost wages and tax refunds towards your unpaid loans.
If you can't repay your education loans, you could seriously damage your credit rating, which can make it hard to get other types of consumer loans. On Federal Direct Unsubsidized Loans and Federal Direct PLUS Loans, the government starts charging interest as soon as the loan funds are received. You can pay the interest while in school or capitalize it (have it added to the principal) and begin repaying it after you graduate. Paying the interest while in school will help you reduce your payments later. When interest is capitalized, the loan principal increases, meaning that interest is figured on a larger amount each time.
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Frequently asked questions
There are Federal Direct PLUS loans, Federal Direct loans, Federal Nursing loans, and Health Professions Student loans. Anyone can apply for a private student loan, but it is recommended to review options for a federal loan first.
Federal loans usually have lower interest rates and more favourable terms. They also allow you to postpone repayment until after graduation. Private loans, on the other hand, require a good credit history or a co-signer with good credit history, and they have variable interest rates.
Before applying for a private loan, complete the FAFSA to see if you qualify for a federal loan.
You can pay your bill online via credit or debit card, or via electronic check (e-check). You can also set up a payment plan to pay off your account in instalments. Additionally, if you're an international student, you can pay in your own currency using Flywire, PayMyTuition, or Convera.
If you can’t repay your loans, your credit rating could be damaged, making it difficult to obtain other types of consumer loans. Defaulting on a federal loan can also result in serious consequences, such as losing wages and tax refunds.
