Grants & Loans

Federal Subsidized Stafford Loan

A dependent student may obtain a loan up to $3,500.00 for the first academic year and $4,500.00 for the second academic year (students who have completed 30 credit hours or more), based on documented need. Cumulative loan limits for a four-year degree program are $23,000.00.

An independent student may obtain a loan up to $3,500.00 for the first academic year and $4,500.00 for the second academic year (students who have completed 30 credit hours or more), based on documented need. Cumulative loan limits for a four-year degree program are $23,000.00.

Dependent students whose parents have not been denied a Plus Loan and independent students whose parents have been denied a Plus Loan may be eligible for further unsubsidized loans.

Total subsidized/unsubsidized amounts for dependent students is $5,500.00 for the freshman year, $6,500.00 for the sophomore year, or a cumulative loan limit of $31,000.00 for an entire four-year degree program.

Total subsidized/unsubsidized amounts for independent students is $9,500.00 for the freshman year, $10,500.00 for the sophomore year, or a cumulative loan limit of $57,500.00 for an entire four-year degree program.

The loan is secured from a private lending institution, i.e., a bank, a savings and loan, or credit union. There is no loan payment or interest charged while the student remains in school at least half-time. Students must begin repaying the loan at an annual variable rate based on a 91 day T-Bill +3.10%, capped at 8.25%, six months after they graduate, leave school, or are enrolled less than half-time. These loans are guaranteed by various agencies and reinsured by the federal government. Students are required to apply through a federally approved need analysis system to determine their eligibility and have a complete financial aid file prior to having a Stafford Loan processed by the Financial Aid Office.

For Information on how to apply for this grant please contact the Director of Financial Aid at Otero Junior College.

Federal Unsubsidized Stafford Loan

This loan is not based on financial need. Students may receive both a subsidized and unsubsidized Stafford Loan, but the total may not exceed Stafford loan limits. Unsubsidized loans are available to dependent and independent students.

A dependent student may obtain an additional unsubsidized loan of up to $2,000.00 for the first academic year and $2,000.00 for the second academic year (students who have completed 30 credit hours or more), based on documented need. Cumulative loan limits for a four-year degree program are $8,000.00 for unsubsidized loans.

An independent student may obtain a loan up to $6,000.00 for the first academic year and $6,000.00 for the second academic year (students who have completed 30 credit hours or more), based on documented need. Cumulative loan limits for a four-year degree program are $34,500.00 for unsubsidized loans.

Total subsidized/unsubsidized amounts for dependent students is $5,500.00 for the freshman year, $6,500.00 for the sophomore year, or a cumulative loan limit of $31,000.00 for an entire four-year degree program.

Total subsidized/unsubsidized amounts for independent students is $9,500.00 for the freshman year, $10,500.00 for the sophomore year, or a cumulative loan limit of $57,500.00 for an entire four-year degree program.

For Information on how to apply for this grant please contact the Director of Financial Aid at Otero Junior College.

Federal Parent Loan For Students (PLUS)

This loan is for the parents of dependent students and secured from a private lending institution. Parents may borrow up to the cost of attendance per child (minus other aid). Repayment may be made monthly or quarterly; or interest may be capitalized no more frequently than quarterly. Annual variable rates are based on a 52 week T-Bill +3.10%, capped at 9%.

For Information on how to apply for this grant please contact the Director of Financial Aid at Otero Junior College.

What is the difference between a Subsidized and Unsubsidized Stafford Loan?

Subsidized Loans

If you have a subsidized loan, you will not be charged interest while you are enrolled in school at least half time, during a grace period, or during authorized periods of deferment. Interest will begin to accrue(accumulate) when you enter repayment. Repayment usually begins within 6 months after you graduate, leave school or do not enroll at least half time (6 credit hours/semester).

Subsidized loans are based on financial need.

Unsubsidized Loans

If you have an unsubsidized loan, you are responsible for the interest from the time the loan is disbursed until it's paid in full. You can pay the interest as you go along. Or, you can allow the interest to accrue (accumulate) - for example, while you're in school you can have the interest added to the principal amount of your loan later. This means the interest will be "capitalized."

Unsubsidized loans are not based on financial need.

Who qualifies for a Direct Loan?

If you are a student who is enrolled in an eligible program at least half time (6 credits/semester) and meet the other criteria for Federal student aid programs, you may be eligible to receive a Direct loan.

How much can I borrow per year?

Federal Stafford Loans for Undergraduate Dependent Students (whose parents have not been denied a PLUS Loan)

Grade Level Base Amount* Additional Unsubsidized Total Amount
Freshman $3,500 $2,000 $5,500
Sophomore $4,500 $2,000 $6,500
Aggregate** $23,000 $8,000 $31,000

* Base Amount = Maximum amount that may be Subsidized

** Aggregate = Maximum amount you can borrow for your entire undergraduate degree

Federal Stafford Loans for Undergraduate Independent Students (and Dependent Students whose parents have been denied a PLUS Loan)

Grade Level Base Amount* Additional Unsubsidized Total Amount
Freshman $3.500 $6,000 $9,500
Sophomore $4,500 $6,000 $10.500
Aggregate** $23,000 $34,500 $57,500

* Base Amount = Maximum amount that may be Subsidized

** Aggregate = Maximum amount you can borrow for your entire undergraduate degree

The amount a student can borrow is also limited by the student's school costs, other financial aid the student may receive, and in the case of subsidized loans, the student's Expected Family Contribution (EFC).

What are Satisfactory Academic Progress Standards?

To meet satisfactory academic progress standards, you must:

Maintain a minimum cumulative grade point average (GPA) of 2.0 or above for all credits attempted; and Complete at least 67% of cumulative attempted credit hours: (Credits Completed / Credits Attempted X 100 = Completion Rate) and Complete eligible degree/certificate program within 150% of scheduled program length.

Once you have attempted 110% of the number of credit hours required for your degree or eligible certificate program, you will be required to submit a Degree Completion Evaluation Form with a signature of an Academic Advisor or Counselor in order to be considered for continued financial aid eligibility.

Up to a maximum of 30 credit hours of 'for credit' remedial coursework are allowed when determining enrollment status. Therefore up to 30 credit hours of remedial credits will not be included in the calculation when determining if you have exceeded the maximum time length (150% of the hours required) for your declared program of study, provided the courses are not applicable to that program.

ESL classes are not included in the maximum time length (150% of the hours required) for the calculation of SAP. Transfer credit hours are included in the calculation of allowable maximum timeframe.

Attempted credit hours under all courses of study are included in the calculation of attempted and earned credit hours. If it is at any point determined you cannot complete your program of study within 150% of the program length, financial aid eligibility will be suspended.

Review of Satisfactory Academic Progress will be done shortly after the stated due date for grades at the end of each academic term.

Should you fail to meet one of more of the above indicated standards you will be placed on financial aid probation or suspension according to OJC's guidelines.