AUB - Financial Aid - AUB Student Loan Program

Medical Student Loan for the Academic Year 2009-10

The Loan Program

1 . The Loan Concept

2. Loan Procedures

3. Guarantor Conditions

4. Required Documents

Important Note to Remember

Where?

Banque Misr Liban (BML)- Bliss Branch (near Zaatar W Zeit)

Tel: 01-362118

Contact Person: Miss Maya Watfa

When?

TBA

Students should start early.

The process for 1 student may take up to 2 weeks.

1. THE LOAN CONCEPT

The student loan program was designed to allow an increase in the overall financial assistance provided to students who will partially assume the responsibility of this aid by repaying the loan part after graduation. The financial aid assessment of the student will be transformed into a financial aid package including an AUB grant and a Bank loan, such that students with low to average need will receive less grant but more loan, whereas students with high need will receive more grant but less loan. Hence, the loan is mandatory to the students who are receiving financial aid.

The loan is subsidized by AUB during a student's years of study until graduation. Accordingly, AUB will pay the interest of the loan relieving the students and their parents from this financial burden during these critical years until graduation. Repayment of the loan starts after graduation and over a maximum period of 6 years following a grace period
of six months. Starting graduation an interest rate will be applied at the rate generally applied by the bank on personal loans minus 2%. The annual loan amount will range between 5% and 30% of the annual tuition fee not exceeding $6,500 for medical students. The students must take the loan during each of their years of study as determined by the Financial Aid Office (FAO) and should therefore repeat related procedures each year. The total amount of the loan will depend on the eventual repayment ability of the student (parents) as judged by the bank.

2. LOAN PROCEDURES

The loan process consists of 2 phases, each consisting of a certain set of procedures. Phase 1 is referred to as the Student Loan and is repeated each year. Phase 2 is referred to as the Personal Loan and occurs only once. During the two phases, the student and one of his/her parents are involved, the latter serving as guarantor. If both parents are not working or do not satisfy the conditions (listed in section 3) required by BML for a guarantor, then any relative/friend to the student can be the guarantor provided he/she fits those conditions. The student and guarantor are referred to here within as the Client.

Phase 1: Student Loan

This phase involves the following procedures:

1. The FAO assigns the loan amount for the year based on the financial aid received.

2. The loan amount is shown on the student’s Statement of Fees as a Prospective Loan and will therefore be deducted from the tuition fees.

3. The Client should go to BML – Bliss Branch with the required documents (see section IV) to fill and sign the loan application

4. BML will study the application

5. BML will inform the FAO and the Client of the final decision

6. If the loan is approved the Client should go again to BML in order to finalize the process

It is the Client’s responsibility to follow-up with the bank for the final signature after the bank approval with the set time frame and process deadline stated on the top of this page .

These procedures should be repeated each year by the client during the student’s period of study for the purpose of renewing the loan.

Phase 2: Personal Loan

Upon graduation the student should convert the Student Loan to a Personal Loan. This consists of the following procedures:

1. Three months prior to the expected date of the student’s graduation the client proceeds to BML with the required documents (see section IV) to sign an application in order
to convert the Student Loan to a Personal Loan.

2. As in Phase 1, BML will study the new application.

3. Upon the bank’s approval the Client should go again to BML for a final signature. It is important to note that although the client is signing prior to graduation the Personal Loan
becomes effective only after the graduation of the student.

4. BML sends to the FAO the list of students who have finalized the conversion and these will be cleared by FAO during the AUB clearance process.

5. Students who do not finalize the conversion of the Student Loan within the set deadline will not be cleared and AUB will keep hold of their diplomas until the process is completed.

An Alternative to Phase 2: Cash Settlement

Upon graduation, the student can choose not to convert to a Personal Loan provided he/she pays the whole amount of the Student Loan to the
bank during the period of Phase 2. In this case the student will also be cleared as described in Phase 2 and no prepayment penalty will be applied.

3. CONDITIONS FOR GUARANTOR

· The Client shall be Lebanese, or a permanent resident of Lebanon with a minimum of a residency of ten years.

· The monthly income of each guarantor should amount to a minimum of USD 600.

· The monthly installments must not exceed one-third of the guarantor’s monthly income.

· The guarantor must not be more than 67 years old on the date of graduation of the Student.

3. REQUIRED DOCUMENTS

The documents required depend on the type of employment of the guarantor. 
    Documents Required from Employees of the Private Sector

- Copies of the National IDs of both student and guarantor + Copy of the student's AUB ID.

- Salary Attestation in original form signed by the employer showing the number of years of employment and to be duly certified by the Employer's Bank.