Loans

Carl D. Perkins Loans are available to U.S. citizens and eligible non-citizens. Funding for this loan is provided by both the federal government and Luther with the college acting as the lender. Perkins funds are limited and therefore reserved for students with high financial need. The amounts vary, but cannot exceed $4,000 per year for undergraduate study. These loans are interest free until repayment begins nine months after the borrower ceases to be enrolled. The interest rate during repayment is 5% per year. The minimum repayment is $40 a month plus interest, and the student has up to 10 years to repay. No deferments will be made for academic leaves. Recipients must demonstrate need, be enrolled full-time, and be in good academic standing. Application must be made each year by completing a FAFSA and indicating that a copy be sent to Luther College.

Subsidized Ford Federal Direct Loan Program is available to U.S. citizens or eligible non-citizens. These loans are based on need and eligibility as determined by analysis of the FAFSA. The interest rate is fixed and set on an annual basis. Interest does not accrue while the student is enrolled at least half-time (6 hours) at Luther.

Unsubsidized Ford Federal Direct Student Loans have similar terms as the subsidized Ford Federal Direct Student Loans except the interest rate is higher and accrues while the student is in college. The student may defer the interest payments while in school; however, the interest will accrue during the deferment period and will be capitalized at graduation.

The student may borrow during the same year under both the subsidized and unsubsidized Ford Federal Direct Student Loan program; however, the total borrowed may not be more than the annual grade level limit-freshman $5,500, sophomore $6,500, junior and senior $7,500.