Student and parents review the financial aid award letters received from schools. Student and parents make financial decisions on how to pay for college. Student and parents select the school to attend. Loan Application Phase Borrower requests loan by submitting loan application and promissory note to lender. School certifies student eligibility.
Lender approves borrower loan application and requests a loan guarantee.
Guarantor provides guarantee. Disbursement Phase Lender sends loan proceeds to the school by check or electronic funds transfer. School may contact borrower for check endorsement. School applies loan proceeds to student's outstanding bill and turns over any remaining funds to borrower. Lender sends parent borrower a repayment disclosure statement for federal PLUS loan.