A federal student loan contract is a one that is entered into between the federal state and a student. The loan is obtained by the student as a borrower from the government for pursuing higher education. The contract shall include details about the loan such as loan amount, rate of interest, demonstration of financial need, promissory note, repayment terms, etc. A sample federal student loan contract is provided below for better reference.
Sample Federal Student Loan Contract:
The Contract is signed on 24th May 2005, between the federal state government department and Ms. Rene George for the purpose of obtaining student loan for pursuing higher studies.
Details of Borrower :-
Name : Rene George.
Address : Tower 4, Forest Avenue, Seattle, US.
Age : 18 years
Account no: 0122 333 444
- The borrower has applied for a federal student loan of Twenty thousand dollars, 20,000$.
- The student is provided loan by the federal state for a period of 4 years starting effective from the date the first instalment of the loan release.
- The student is applying for the loan for pursuing engineering course from New York University.
- The rate of interest for the student loan is fixed at the rate of 6.8% per annum which is payable along with principle on completion of the course being pursued by the borrower.
- There is no prepayment penalty imposed on the borrower.
- The equated monthly instalment for the student loan stand effective from three months of completion of the course and has to be paid without fail irrespective of the borrower being able to secure employment.
- The student loan can be terminated at any point of time by the federal state department on finding the academic performance of the borrower unsatisfactory.
Signature of the Borrower : Rene George _____________________
Signature of Witness : Lavin Thomas _____________________