1906 - External Loan Disbursements

Document purpose

To ensure that certification of loan eligibility from all external Federal, State and private loan programs is performed in compliance with all applicable governing regulations. Also, to ensure that all loan disbursements from external sources are recorded in the applicable University system(s) and credited to student tuition accounts according to loan program requirements.


January 1989


May 2023


May 2023

Responsible Office

Student Registration & Financial Services


Student Registration & Financial Services

The Policy

  1. The Loan Operations team within Student Financial Aid is responsible for certifying loan eligibility for all external loan programs.

  2. Loan certification requests are currently recorded in the Pennant Aid system by processing electronic files or by performing data entry of loan applications.

  3. The Pennant Aid system is integrated with Pennant Student and Pennant Account Receivables.  Both batch and manual processes are used to determine and certify student loan eligibility by accounting for student academic status, financial resources and cost of attendance.

  4. Loan eligibility results are reported to the Department of Education, lenders and loan originators through exchange of electronic files or use of hard copy applications and certification requests. Loan providers can choose to approve or deny certification requests.

  5. Disbursements from approved loans are issued to the University by drawing down funds from the G5 payment system for Federal Direct Loans, by EFT for most private lenders, or by loan check, usually one disbursement per academic term.

  6. Federal Direct Loan and EFT disbursements are recorded in Pennant Aid. Student eligibility for the loan disbursement is validated through a series of system edits. Pennant Aid validates continued student eligibility for the loan.  Credit for a loan disbursement is passed to a student’s tuition account on the billing and receivable system (Pennant AR).

  7. Student loan checks are recorded in the check workflow tool. A check receipt is produced and attached to the check. Continued eligibility for the loan is validated before checks are delivered to the Student Service Center, Room 150 Franklin Building for student endorsement. After a student endorses a check, credit is posted to Pennant AR from an interface from the check workflow to Pennant Aid.  The Student Accounts team deposits endorsed loan checks into the appropriate BEN account.

  8. Excess credit from student loan disbursements will be issued to the student as a refund after all charges are paid.

  9. Lender refunds are produced when student loan eligibility is reduced due to changes in enrollment, reduction in tuition charges, receipt of additional financial aid, or upon a student’s request. Refunds are sent to the Department of Education, loan originators or lenders by multiple methods including wire transfers, individual and master check processes, and proprietary cancellation rosters.