Some academic departments manage institutional loan funds from which they may make loans to their eligible students. The department is responsible for giving the student pre-loan counseling, determining the student's eligibility and making the award. Once the loan has been authorized using the application for student loan, Student Fiscal Services will prepare a promissory note, deliver the funds to the student and set up a billing account for repayment (according to the terms of the fund).
Truth in Lending Act (TILA) requirements
Effective February 14, 2010: Truth in Lending Act (TILA) regulations were enacted that require four additional disclosure documents that student borrowers must be given when applying for a long-term institutional loan:
- A generic disclosure (#1) – given to the student at time of application.
- A specific disclosure (#2) – given to the student at time the loan is approved.
- A self-certification document (to be completed by the student and submitted at the time of loan application).
- A specific disclosure (#3) – given to the student when the loan is finalized.
Instructions for Completion of Loan Application
- Review Roles and Responsibilities
- Top section of the form (loan amount, loan type and loan purpose)
- Student information section (name, student number, major, etc)
- Section labeled For Department Use Only (repayment information is for short-term loans only). You may select a due date, or opt for on-demand which means that the loan will be due when other financial aid is received, or on the due date you specify, whichever comes first. Most short-term loans funds require this clause. Check the cash only box if you want the entire loan to be disbursed to the student in cash, instead of credit on their student account.
- Print the application:
- Change the print layout to Landscape
- Press Ctrl - P
- Click the Properties buttonUnder the Layout tab, click the Landscape button
- Click OK, then again to print
- Have the student complete the address, employer information, parent information and references sections. Have the student sign and date the bottom in the Borrower’s Signature box.
- If the loan fund requires a cosigner, have the student complete this area (most loan funds do not require cosigners).
- Sign the bottom right-hand box labeled Dept. Signature.
- Send the completed form to Student Fiscal Services for entry into the Student Database.
- The next business day after the loan has been entered into SDB, the student
promissory note will be available for the student to sign.
Instructions for Completion of TILA Disclosure Forms
- Print the generic disclosure (#1) and give a copy to the student who is applying for an institutional student loan.
- If the student is approved for an institutional student loan, prepare disclosure (#2)
- Complete the shaded fields on the form:
- Total Loan Amount - amount of the loan that you are approving
- Interest Rate – the per annum interest rate of the loan you are approving
- Finance Charge – the estimated finance charge the student will repay (use the online calculator, entering the loan variables, to determine this number)
- Total of Payments – add the ‘Total Loan Amount’ and the ‘Finance Charge’ to determine this number
- Total Amount Paid to You and/or UW on your behalf – enter the amount of the loan you are approving
- Total Loan Amount – the amount of the loan you are approving
- ____ YEAR LOAN TERM – the maximum repayment period for the loan being approved (in years)
- Installment Payments at ___% – the per annum interest rate for the loan fund being approved
- In Repayment: ___% – the per annum interest rate for the loan fund being approved
- Monthly Installment Payment – the estimated monthly payment (using the online calculator, enter the loan variables to determine this number)
- Total Interest Paid – the approximate total interest that will be repaid over the life of the loan (using the online calculator, enter the loan variables to determine this number)
- This offer is good until (on pg. 2) – calculate 30 days (minimum) from the date the loan is approved
- You have until _____ to accept this offer – calculate 30 days (minimum) from the date the loan is approved
- Important: give one copy of this disclosure to the student, and make a second copy to send with the loan application form to Student Fiscal Services
- Print a copy of the self-certification document and provide the data needed for sections A, B and C of the form.
- Follow the instructions to calculate the amounts for sections A, B and C of the form.
- Important: Attach the completed/signed Self-Certification form to the loan application and send/deliver them to Student Fiscal Services (the loan will not be disbursed until a completed Self-Certification form is received by SFS)