Loans
Luther's Financing Philosophy
Students are encouraged to borrow only what they need and to seek outside scholarships and save summer earnings in order to reduce overall indebtedness. The Financial Aid Office works closely with students to achieve this goal.
According to the Iowa College Student Aid Commission, the average Luther student graduates with debt equal to or less than the average graduate of any of the state universities in Iowa. We work hard to ensure that our graduates will be able to repay their loans upon graduation—Luther's Stafford Loan default rate of less than 2 percent is evidence of our success.
There are two ways loans can help cover your college expenses: You can receive need-based federal loans as a part of your financial aid package and/or you can apply for non-need-based loans to cover your family's contribution to your education.
Federal Student Loans
Students must complete the Free Application for Federal Student Aid (FAFSA) to be considered for the federal student loan programs. All students receiving a Federal Stafford Loan are required to complete loan entrance counseling on the web to ensure you fully understand borrower rights and responsibilities. The entrance counseling quiz will take 20 to 30 minutes and may be completed at www.dl.ed.gov.
Federal Parent Loan
Parent Loan for Undergraduate Students (PLUS) provide a simple solution for paying educational expenses with the benefits of a federally guaranteed loan. This program allows parents to share the responsibility of financing a college education to help reduce the debt burden of their student. Parents borrow at a fixed rate of 7.9 percent. Because Luther is a Direct Lending school, it is not necessary to apply through a bank to get your loan. Students must complete the FAFSA before a parent may apply for this loan. Parents may request deferment of this loan while the student is enrolled by contacting the Direct Loan Servicing Center.
Private Loans
Other loan programs are available to allow you or your parents to finance your educational expenses over a longer period of time. These financing programs allow you to manage your investment in a way that reflects your family's unique circumstances, allowing you to choose from different benefits and terms. Funding is available to finance your total share of the cost of education, including travel and personal expenses, if you wish.
The State of Iowa requires all students to exhaust their federal loan eligibility before investigating private student loan options as federal student loans have better terms and conditions. Private loans should be utilized to pay no more than directly billed college expenses.
Eligibility for these programs is based on credit-worthiness and ability to repay, not on financial need. Some plans offer deferment of principal payments while you are enrolled. Choose from fixed or variable interest rates and student or parent borrower options. Our most popular programs are outlined below. These lenders offer private, non-federally funded, educational loans with competitive rates. This list is not all-inclusive and does not imply endorsement by Luther College. Luther College will certify a loan from any lender you determine best meets your needs even if they are not on this list.
Applications for these loans are available online. Applications are normally completed for the full academic year and funds are disbursed equally between semesters. Submit your application early to ensure sufficient time for processing. Applications should be submitted in June or July for fall funds to be available at the beginning of the semester.
Please carefully consider the following funding sources. Luther College financial aid administrators review those listed annually to ensure programs suit the needs of prospective and returning students. While we believe the content listed within these links is accurate, official data should be taken directly from the lender.