Note: These links are provided only for your convenience and are not associated with United Southwest Bank.

United Southwest Bank provides this Step-by-Step Guide to assist you in the process of applying for a Student Loan. These steps may be completed either on the Internet or you may request paper forms from your school or bank. Web sites and links are provided for you in the steps below to help you complete the process on the Internet.

After applying for admission to a school, the next step for every student is to complete a FAFSA (Free Application for Federal Student Aid). This is a FREE application so do not pay anyone to fill out or process this application for you. The FAFSA provides a financial picture of both parents and students. Even if you do not qualify for Federal Student Aid or grants, the FAFSA will determine the type of student loan that you may qualify for.

Narrow your choices down to no more than six schools. Apply for admission and request a Financial Aid Package from each school. This information will help determine the forms and deadlines required for the school.

If you are going to complete and electronically sign your Free Application for Federal Student Aid (FSFSA) online, you will need to apply for a Federal Student Aid Personal Identification Number (FSA PIN). If you are still a dependant of your parents, your parents must also apply for a FSA PIN. You DO NOT need to apply for a FSA PIN if you are going to mail your FAFSA ...To apply for your FSA PIN, click on the link below.

Step Three: Complete the FAFSA

Complete the Free Application for Federal Student Aid (FAFSA) and submit it to the Department of Education. The information provided on your FAFSA will determine if you will receive any Federal Student Financial Aid and determine your Federal Loan Eligibility . . . To complete your FAFSA online or to print the FAFSA forms, click on the link below.

Step Four: Wait to receive your SAR

Wait to receive your Student Aid Report (SAR). If you mailed your FAFSA, you should receive your SAR by mail within 7-10 days. If you submitted your FAFSA online, you should receive your SAR within in 3-5 days.

Once you receive your SAR, make sure all information on it is correct. If anything is wrong, make the correction and send it back by mail or by clicking on the FAFSA link above . . . To check your status, view, correct or print your SAR online, click on the FAFSA link above.

Your SAR will contain your Expected Family Contribution (EFC), which is how much you are expected to pay. A similar report will go to the school(s) you chose on the FAFSA. Each school(s) will send you an award letter specifying what sort of federal student aid or federal student loans you are eligible for.

Your Award Letter will specify any federal student aid and/or federal student loans you are eligible for. The amount awarded will vary for each school based on cost of room, board and tuition. The difference between the money you are awarded in your financial aid package and the actual money you're going to need to cover all of your school expenses is your Expected Family Contribution (EFC). This financial gap is filled with different types of student loans. Your Award Letter should indicate if you qualify for a Stafford loan and the amount. The remaining school expenses will have to come from other types of student loans.

Types of Student Loans:

1. STAFFORD LOANS - are federally regulated and the school decides how much a student can borrow. Your Award Letter from the school should indicated if you qualify for a Stafford loan. For this type of loan, the student is the borrower and based on their financial needs may either be:

- Subsidized Stafford Loans - Federal government pays all or some interest while in school, or
- Unsubsidized Stafford Loans - Interest is accrued while in school and must be repaid.

Stafford Loan Terms, Fees and Limitations:
• Loan rates are fixed and are generally the lowest rate available.
• Loan repayment terms are 10 years.
• Loan fees range from 0-3% of loan for default and guarantee fees.
• There is a 1% default aversion fee that can be charged on each loan distribution.
• Loan origination fee is 2%.
• Aggregate loan limits for undergraduates is $23,000 with:
  - Freshmen year limits: $3500
  - Sophomore year limits: $4500
  - Junior year limits: $5500
  - Senior year limits: $5500
• Loan disbursements go directly to school before any funds are disbursed to student.
• Six-month grace period after graduation or dropping below half-time status.
• Minimum monthly payment is $50

2. PLUS LOANS - are Parental Loans for Undergraduate Students (PLUS). For this type of loan, the parents are the borrowers and they cannot transfer the loan to the student at any time. PLUS Loans are used to pay for the remaining school expenses that are not covered by Federal Student Aid or Stafford loans. The parents must pass a credit check to qualify for this federally guaranteed loan.

PLUS Loan Terms, Fees and Limitations:
• Loan rates are fixed and are generally slightly higher than Stafford loans.
• Loan repayment terms are 10 years.
• Loan fees range from 0-3% of loan for origination and default aversion fees.
• There is no aggregate loan limits for PLUS loans.
  - A parent can take up to the total cost of attendance less any financial aid by the student.
• 60 day grace period after graduation or dropping below half-time status.
• Minimum monthly payment is $50

3. ALTERNATIVE LOANS - allow undergraduate or graduate students who pass a credit check to borrower extra money in addition to funds from federal awards. Alternative loans come from places like banks, insurance companies, foundations, etc. Typically, interest rates and fees will be higher than for a PLUS loan.

Alternative Loan Terms, Fees and Limitations:
• Loan rates are variable monthly interest rates 2-7% above the prime rate.
• Loan repayment term varies.
• Loan origination fees range from 4-8% depending on credit score
• There is no aggregate loan limits.

United Southwest Bank uses BrainScratch.com to process your Student Loan application through Student Loan Finance Corporation (SLFC).

BrainScratch can be used by Students and Parents to apply for:
• Stafford Loans - after the student has been approved based on their Awards Letter
• PLUS Loans - to allow parents to borrow money for their child's school expenses
• Alternative Loans - called BrainBucks on BrainScratch.Com

To apply for a student loan on BrainScratch.com:

1. Register or Sign In as a member on BrainScratch.com ... Click on the link below:
   
2. Please remember to select preferred lender:
   UNITED SOUTHWEST BANK of MARSHALL MINNESOTA
   Lender Code = 302604
3. Then follow the instructions on BrainScratch.com