<p>I am finishing my last semester at a community college and was surprised that only half the loan I had accepted for the semester has been disbursed. Has never happened to me (or my 2 kids) before so I called the financial aid department to ask why. Apparently there is some federal rule that the loan you are offered has to be disbursed in 2 parts. If you are attending for the full year then the 2 disbursements are fall and spring semesters (that I understand). If you are attending only one semester then the loan you were offered for that semester still has to be disbursed in two parts so one half has been disbursed now and the rest will be disbursed in a few weeks. </p>
<p>I understand the disbursement being divided over the year between the semesters. But I think this is just odd. How does the govt come up with these things? Anyways, I guess the lesson learned is don't ask for a loan for just the 1st semester even if that is all you are planning to take it for!!</p>
<p>Yes, loans are required to be disbursed in two equal disbursements. There are some caveats, but for all intents & purposes this is how it goes.</p>
<p>There is more … “Undergraduate limits must be prorated for a program or remaining portion of a program less than an academic year.” That is, if you are an undergraduate requesting a fall-only loan because your program will end mid-year, the school is required to prorate the loan based on enrollment. For example, if a school’s definition of annual academic progress is 24 credits, the fall only loan is prorated like this:</p>
<p>Student A has 9 credits. Eligibility for fall only loans:
sub=(9/24)<em>5500=2062
combined=(9/24)</em>7500=2812
(this means that the student can borrow a total of 2812, of which up to 2062 may be sub, depending on need)
As you can see, this student would actually get LESS than the “usual” one-half disbursement for fall!</p>
<p>Student B has 16 credits. Eligibility for fall only loans:
sub=(16/24)<em>5500=3666
combined=(16/24)</em>7500=5000
In this case, the student would get more than the usual one-half.</p>
<p>The above loans would be disbursed in two equal parts (schools can choose the time between parts).</p>