Receiving Your Student Loan
After you have applied and have been approved for a student loan, you may wonder how you will eventually receive your funds once they are disbursed. Typically, loan disbursements are given in two installments, usually at the beginning of the Fall and Spring semesters, with no one installment exceeding half of the total loan amount.
Stafford Loan Disbursement
Stafford loan disbursements are controlled by the school and are released no earlier than 10 days prior to the start of classes for that academic year. Refunds may also become available at the start of the semester. Loan recipients may have their refunds mailed to them, deposited directly into their student accounts, or made available for pick-up at their schools' student financial aid offices, depending on each school's policies.
Perkins Loan Disbursement
Perkins loan disbursement is similar to Stafford loan disbursement. For Perkins loans, though, schools receive a limited pool of earmarked Perkins loan funds from the federal government. Then, each school considers all of the FAFSAs received by its financial aid office before selecting the students with the highest levels of financial need to receive Perkins loans. The actual disbursement of loan funds and refunds mirrors the plan described above for Stafford loans.
PLUS Loan Disbursement
For Direct PLUS Loans, the U.S. Department of Education (acting on behalf of the federal government) will send the funds to the college for disbursement. For FFEL PLUS loans, the third-party lender will send the funds to the college.
Private Education Loan Disbursement
The disbursement procedure for private loans depends largely on the specific lender you choose. To find out when you will receive your funds, contact your lender directly and ask about their disbursement plan.
For most federal loans, funds will be reflected on your school account automatically. These funds must be used to pay any school-related expenses first, such as tuition, student fees, and room and board. All remaining funds will be issued to the student as a refund. Refunds must also be used for school-related expenses, such as textbooks and other student-related fees. To learn more about your individual disbursement procedure and other loan options, we recommend contacting your school's financial aid office directly.
