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Loans are funds that are borrowed to help meet educational expenses. Loans provide funds now, but require future repayment. Interests rates and repayment terms vary for different types of loans. Before you accept a student loan, you should carefully consider the cost of the loan–and the commitment you are making to repay it–against the advantages of borrowing for college expenses.
Students have the option to accept all or only a portion of their loan awards. You are not obligated to accept any loan funds that have been included on your financial aid award letter. Additionally, you may return all or a portion of your loan to the University within 14 days of disbursement and we will return the funds the Direct Loan Program.
Student loans can come from the federal government or from private sources such as a bank or the university. Loans made by the federal government, called federal student loans, usually offer borrowers lower interest rates and have more flexible repayment options than loans from banks or other private sources. Learn more about the differences between federal and private student loans.
Student Loan Code of Conduct
- “Employee” or “School employee” means any employee, agent, student financial aid contractor, director, officer or trustee of the school. For purposes of the Code of Provisions relating to gifts and stock ownership, this term includes family members of the Employee. For purposes of Paragraph 2 of this Code, this term includes family members living in the same household as the Employee.
- “School” means all colleges, campuses, departments or other components of the higher education institution adopting this Code of Conduct that are either located in Arizona or that offer online classes to Arizona residents, including alumni associations if the associations are under the institution’s control and are not separately incorporated. This includes all University of Phoenix locations and online programs.
- “Student loan lender” or “lender” means any entity involved in making, holding, consolidating, originating, servicing or guaranteeing any loan to students or parents to finance higher education expenses. This includes lenders who provide private educational loans as well as lenders who provide loans that are made, insured or guaranteed by the U.S. Department of Education, except loans under the William D. Ford Direct Loan Program.
“Nominal value” means a total retail value of not more than ten dollars ($10.00) as calculated over a 12 month period, or as defined by a School policy consistent with applicable federal and state law. This paragraph shall not prohibit School employees from conducting non-student lending business with any lender or accepting or soliciting anything of other than nominal value in any activity unrelated to student loans.
A School employee who is employed in the financial aid office, or who otherwise has direct responsibilities with respect to educational loans, shall not serve on or otherwise participate with advisory councils of lenders or affiliates of lenders.
In addition, a person employed in the financial aid office of the school, or who otherwise has direct responsibilities with respect to educational loans or other financial aid, shall:
- Avoid any equity or other interest in any student loan lender other than a remote interest;
- Avoid consulting or similar financial relationships with student loan lenders and comply with the School’s Conflict of Interest Policies & Procedures.
- The School will not accept anything of value from a student loan lender in exchange for any advantage or consideration provided to the lender related to its education loan activity. This prohibition shall include, but not be limited to: (1) the School’s receipt from any lender of any computer hardware for which the School pays below market prices, (2) preferential rates for, or access to, a lender’s other financial products and (3) printing costs or services. Notwithstanding anything else in this paragraph, the School may accept assistance as contemplated by 34 C.F.R. 682.200(b).
- The School shall not engage in revenue sharing with a student loan lender. “Revenue sharing” means any arrangement under which a student loan lender pays a higher education institution or an affiliated entity or organization a certain sum, fee, percentage or other material benefit calculated in relationship to the volume of loans received by the lender from students of the institution.
- The School shall not enter into an opportunity loan agreement with a student loan lender under which the school provides concessions or promises to the lender that prejudice other borrowers. An “opportunity” loan means a student loan provided to borrowers with poor or no credit history, or who otherwise would not meet the student loan lender’s eligibility criteria. The School shall not request or accept from any lender any offer of funds to be used for private education loans, including funds for an opportunity loan to students in exchange for the School providing concessions or promises regarding providing the lender with a specified number of loans made, insured, or guaranteed; a specified loan volume of such loans; or a specified lender arrangement for such loans.
- The School shall not certify student eligibility for an opportunity loan made available pursuant to an agreement between the School and a lender unless (a) the agreement includes the option of short term or partial loans not to exceed one year and (b) the School informs the borrower of the short term or partial loan option, so the borrower can consider different or less expensive financing if the borrower’s financial condition improves.
The School shall require all of its employees with direct responsibilities relating to student loans to obtain training concerning the Student Loan Code of Conduct, applicable federal as well as state student loan laws and regulations and related School policies and procedures within 90 days of when the School adopts this Code or for new employees within 90 days of the date of hire. The School shall adopt procedures to ensure these employees maintain current knowledge of the Code and applicable regulations.