Frequently Asked Questions

Student loans

• What is the difference between a subsidized and unsubsidized loan?
• Are there restrictions on how I use my student loan money?
• How is a loan capitalized?
• What is required to obtain a Federal Family Education Loan (FFEL) Program Loan?
• What are the maximum borrowing amounts under the Federal Family Education Loan (FFEL) program?
• What if I transfer schools? Will my student loans be transferred automatically?
• Besides federally guaranteed loans, what other sources of student loans are there?
• What if I don't want to sign a legal document that's good for 10 years?
• What is the advantage of a Master Promissory Note (MPN)?
• Will the Master Promissory Note be valid if I change schools?
• Are there other conditions under which a new Master Promissory Note (MPN) will be required?
• What student loans can I sign with an eSignature?
• Does an eSignature have the same validity as a written signature?
• Is my information secure when I use an eSignature?
• What is the advantage of using eSignature?
• How do I get a U.S. Department of Education Personal Identification Number (PIN)?
• What additional funding is available after grants, federal loans and federal aid is utilized?

Applying for a loan

• Do you have an online loan application?
• What education loans can I apply for online?
• What do I need to do before applying online?
• Do I need to advise my financial aid administrator that I have applied online for a federal student loan?
• What happens if I apply online for a federal loan and fail to tell my financial aid administrator?
• What happens after I apply online?
• Can I check the status of my application after I submit it?

Repayment of loans

• What should I know to help me repay my student loans?
• Can I get a refund if I don't complete the school term?
• What can I do if my family cannot pay its Expected Family Contribution (EFC)?
• What can I do if I encounter an economic hardship that interferes with my ability to repay my loan?
• What can happen if I don't repay my federal student loan?
• What is the best way to avoid problems in repayment phase?

Credit cards

• How can I avoid interest charges on my credit card purchases?
• How is my credit limit determined?
• How can I make sure I don't overspend with my credit card?
• How can I protect myself from credit card fraud?

Student Visa^€ Platinum

• When will I receive my card?
• What if my credit card gets lost or stolen?
• Can I link my credit card to my Bank of America checking or savings account?
• What is an annual percentage rate (APR)?

What is the difference between a subsidized and unsubsidized loan?

With a subsidized loan, the interest that accrues is paid by the Federal Government while the borrower is in school at least half-time or during grace and deferment periods. With an unsubsidized loan, the interest is paid by the borrower, rather than the government.

Yes. You must use your student loan only for education-related expenses, such as tuition, lab fees, books and supplies, and room and board. If you have dependents, such as a child or an elderly parent, you may use your loan to cover the expense of caring for them while you are in school.

A loan is capitalized by adding the amount of unpaid interest to the principal balance of the loan. This increases both monthly payments and the total repayment amount. If a borrower elects to allow the interest to accrue, rather than pay it quarterly when billed, the accrued interest is added to the principal balance when the borrower starts repaying the loan

Federal regulations require a borrower to:

• Be a US citizen or provide his or her Alien Registration ID number
• Complete US Selective Service registration (male borrowers only)
• Attend an eligible institution for a degree or certificate
• Make academic progress as determined by the school
• Not have defaulted on a previous educational loan or owe a refund on a grant

Final eligibility for a loan is determined by a school financial administrator. The borrower is not required to have an account with Bank of America in order to obtain a FFEL Loan.

As an undergraduate student, the total subsidized and unsubsidized loans for all years is $31,000 (dependent students) and $57,500 (independent students). For graduate and professional, the amount is $138,500. The year-by-year allocations for undergraduate students vary, depending upon whether the student has independent or dependent status.

No, your present school won't transfer your loans automatically. So if you're thinking about transferring, talk with your lender and the financial aid officer at both your current school and your new school right away. It's also a good idea to check with your new school to find out what additional student aid programs are available and how you can qualify for them.

Some schools offer private alternative loan programs. The U.S. Department of Education sponsors the William D. Ford Federal Direct Loan Program, which grants Stafford Loans and PLUS Loans directly through the Government, serving as lender. To find out if your school participates or offers private loans, ask your school's financial aid administrator.

Advise your school in writing that you do not want new Stafford loans made under an existing MPN.

You may not have to sign a new promissory note when it's time to obtain another federal Stafford loan. The MPN allows students to receive several new loans over a period of 10 years.

If your new school is authorized to certify subsequent loans under your existing MPN, you will not have to sign a new promissory note.

Yes, under the following conditions:

• Your school is not eligible to use the multi-year feature of the MPN
• Your school's policy requires you to sign a new MPN
• You change your lender and the new lender's policy requires you to sign a new MPN

You can use an eSignature on the federal Stafford, PLUS and Grad PLUS loan applications.

Yes. The Electronic Signatures in Global and National Commerce Act gives electronically signed documents the same integrity as those with written signatures.

Information sent through our pages is secure and uses Secure Socket Layer (SSL) protocol. SSL technology secretly encodes information that is being sent over the Internet between your computer and Bank of America, helping to ensure that the information remains confidential.

When you sign your Bank of America Federal Stafford loan application online using e-Signature, you don't have to wait to receive your completed application in the mail, sign it, and mail it back to us. This allows us to process your loan faster and get your funds to you more quickly.

Parents and financial aid applicants who don't have a U.S. Department of Education PIN (or have lost it) can request a new PIN from the Department of Education. Your PIN should arrive in the mail 7-10 days after you request it.

For borrowers choosing to supplement federal loans and federal financial aid, homeowners may want to consider borrowing from the available equity in their home with a home equity line of credit. Please call or visit a Bank of America banking center for more information.

Do you have an online loan application?

Yes, we have several online applications for select student loan products.

• Federal Stafford Loan
• Federal PLUS Loan for parents

For a federal loan you must:

• Complete a Free Application for Federal Student Aid (FAFSA)
• Be in receipt of a Student Aid Report from the FAFSA processing agent
• Attend an eligible institution for a degree or certificate at least half time

Yes, because even when you apply online for a federal loan, your school still must certify and advise us of your eligibility.

Your application processing will be unnecessarily delayed. The information you send us will stay with us until we hear from your school. After we receive their certification we can disburse the loan funds. If your school does not send us certification within 28 days after we receive your application, we'll contact your school to find out if you've been certified for the loan.

When you apply online, we print the application and send it to you for signature. We also provide you with the information about where to send the application for processing. You may want to print a copy of your application for your records.

Please call 1.800.344.8382 and one of our Student Loan Specialists can help you.

What should I know to help me repay my student loans?

First, borrow sensibly and conservatively and remain creditworthy.

Whether or not you complete your term, your student loan is still due. However, the federal government requires every school to have a refund policy. Before you enroll, you should know your school’s criteria for a refund and what the refund covers – tuition, fees and room and board, for instance. If you’re eligible for a refund, your school sends your refund to the holder of your loan, who applies it to reduce your outstanding loan balance.

Your family may want to consider using other financing to make up the shortfall, such as a Federal PLUS Loan for parents, a Federal Unsubsidized Stafford Loan, or a home equity loan or line of credit, financing based on the equity in a home.

When faced with problems repaying your loan, it's your responsibility to contact the holder or servicer of your loan immediately. There are several options available to help you. Two of the most common ones are a deferment and a forbearance.
A deferment is your legal right to suspend loan payments without cost or penalty, if you meet certain criteria. Interest on an unsubsidized loan will accrue unless you pay it when billed.
A forbearance may let you postpone or reduce your payments for a specific length of time, if you are willing, but temporarily unable to meet your repayment obligation. You are still responsible for any unpaid interest that accrues during the forbearance period.

If you default on your loan, the holder of your loan files a claim with the Federal Government to collect funds. Then, the Department of Education and the guaranty agency take charge. The Government notifies all national credit reporting agencies and the situation becomes increasingly serious. The loan default becomes part of your permanent credit history. The Government assigns your loan to a collection agency.

You still owe the entire unpaid amount of your loan, including interest, and it becomes due and payable immediately. The IRS may seize your property, garnish your wages, sue you and make you pay for court costs, deduct the loan amount from federal and state tax refunds, even state lottery winnings. And you may be ineligible for future educational aid.

First, know the name and contact information of your servicer so that you will be able to stay in touch should you have a problem. Know your rights and responsibilities as a borrower. When you take out a loan you also take out an obligation to repay the debt. If you have a problem repaying your loan you have the right to discuss options such as deferment or forbearance to help you meet your obligation.

How can I avoid interest charges on my credit card purchases?

To avoid interest on purchases altogether, pay off your balance in full each month. Or pay a portion of your balance each month, including an interest or finance charge on the remaining balance. The key is to keep your spending under control and pay at least the minimum balance due every month.

Your credit limit is based on your income, existing debt and credit card history. When you have a credit card, it can be tempting to spend more money than you have. Drawing up a monthly budget can help you keep track of your income and expenses, making it easier to handle any unexpected expenses that come along (and you know they will).

When writing down all your monthly expenses to create your budget, set aside an additional amount for unexpected emergencies. If your listed budget expenses exceed your monthly income, it's time to balance your spending. You'll soon see how simple it is to keep up with your monthly payments and build a strong credit history that'll help you down the road to a successful financial future.

Check your statement each month against your own receipts to make sure each transaction is correct. Keep your receipts to yourself and never send your credit card number through the mail on a postcard or the outside of an envelope. Sign your name on the back of your new card the moment it arrives. Only give out your credit card number over the phone if you initiated the call. If a merchant asks for ID when you write a check, ask them not to write down the credit card number. And report a lost or stolen credit card immediately.

When will I receive my card?

You will receive your card within 2-3 weeks upon approval.

Please call customer service at 1.800.942.3843 as soon as you discover your card is missing. International call collect 1.757.677.4701. We'll cancel your card and issue a replacement immediately. You won't be liable for any unauthorized purchases or withdrawals from your account when you notify us promptly.

Yes, you can link your Bank of America credit card and checking or savings account for Automatic Payment service to pay your monthly credit card bill automatically. You can also link your Bank of America credit card to your Bank of America checking account for Overdraft Protection to protect yourself against insufficient funds. Just visit one of Bank of America's banking centers and they will be glad to assist you.

The cost of credit on a yearly basis expressed as a percentage. It reflects interest rate plus any finance charges.