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Minnesota Office of Higher Education

Frequently Asked Questions

What is the SELF V interest rate?

The fixed rate SELF V loan has an interest rate of 6.9 percent. The interest rate will not change over the life of the loan.

The variable rate SELF V loan has an interest rate that changes every quarter. The current interest rate is 3.2 percent. The interest charged is the sum of the margin (currently 3.0 percent) added to the index, which is based on the average three-month London Interbank Offered Rates (LIBOR) rate during the previous calendar quarter rounded to the nearest tenth of one percent. There is a 3-percent cap on interest rate changes during any 12-month period. The interest rate is not tied to any credit scoring. All students are charged the same interest rate.


What are the historic interest rates?

View a chart of historic SELF Loan interest rates.


How Much Can I Borrow?

Maximum Annual Loan Amounts

  • $10,000 for students in a bachelor's degree, postbacalaureate or graduate program
  • $7,500 for all other students

Maximum Cumulative SELF Loans

Bachelor's and
Graduate Programs
Grade Level 1$10,000$7,500
Grade Level 2$20,000$15,000
Grade Level 3$30,000$22,500
Grade Level 4$40,000$30,000
Grade Level 5$50,000$37,500
Grade Level 6-9$70,000$37,500

Loan amounts are based on grade levels. The phrase "grade level" indicates the relative status of a student in a degree or certificate granting program. For example, if you are a student in the second year of a four-year program, you would be in grade level 2, even though you may have been in school for more than two years. Your grade level will be determined by your school.

You may borrow the maximum amount for each grade level providing you don't exceed the cumulative limits. You do not have to borrow the maximum amounts.


What are the repayment terms?

There are no grace periods or deferment options. SELF Loans cannot be included in a federal loan consolidation. Payments of interest are required even while in school. You must begin quarterly payments (interest only) within 90 days after disbursement, and quarterly interest payments continue as long as you are properly enrolled at the school and have not entered a required repayment period.

For SELF V Loans, the loan must enter repayment no later than nine years from the disbursement date. When you finish your study, unless you are already in a required repayment period, you have two repayment options:

  • The Standard Plan requires monthly payment of interest for one year after you leave school and then monthly payments of principal and interest until the loan is paid in full.
  • The Extended Interest Plan provides two more years of monthly interest only before starting principal repayment.

The maximum repayment period for SELF V Loans is determined by the balances on all of your SELF Loans:

  • If the aggregate principal loan balances from all SELF phases are less than $20,000, the repayment term on the SELF V Loans shall not exceed 10 years from when you leave school.
  • If the balances are $20,000 up to $40,000, the repayment term on the SELF V Loans shall not exceed 15 years from when you leave school.
  • For balances of $40,000 and greater, the repayment term on the SELF V Loans shall not exceed 20 years from when you leave school.

There is no penalty for early payment.


What are the requirements for a co-signer?

A credit-worthy co-signer must be:

  • A U.S. citizen or permanent resident 24 years of age or older, or 18 years if a sibling (i.e., a brother or sister) of the borrower.
  • Someone with an address in the United States.
  • Someone who has no credit bureau balances discharged through bankruptcy, no garnishments, attachments, foreclosures, repossessions, or suits; no more than $300 combined total in unsatisfied credit or unsatisfied payment obligations; and no more than 5 percent of credit bureau balances past due.


What happens if I change schools or enroll in a graduate program?

If you transfer to another school or go on to graduate school, you can make interest only payments ONLY if you transfer before the 12-36 month Transition Period elapses, have not entered a required repayment period, continue to be enrolled on at least a half-time basis and ONLY if the school to which you transfer is an eligible one. View a list of schools participating in the SELF program.


Can I capitalize my SELF interest instead of making quarterly payments?

The SELF Loan does not allow you to capitalize in-school interest like some other student loan programs do. Capitalizing interest increases your monthly payment and the amount of money you will eventually repay.

There are benefits of paying interest while in school:

  • overall amount of interest you pay will be less.
  • The quarterly bills will keep you aware of your loan balance and the associated interest cost of your loan.

See example of the benefits of paying interest while in school instead of capitalizing interest.


When should I apply?

Federal regulations that went into effect in February 2010 significantly increased the time needed to process a SELF Loan. Additional steps are required along with mandatory waiting periods. The minimum processing and disbursement time is approximately three weeks if all of the steps are done promptly. Additional time should be allowed for the school to certify the loan. Because of this, you should apply at least four weeks ahead of when you need the money.


Do I need to complete the FAFSA?

Students who may be eligible for federal or state grants are required to complete the Free Application for Federal Student Aid (FAFSA) to document and verify your family's financial information as well as to determine whether you qualify for more desirable forms of financial aid.


Who do I contact if I have a question or problem with my SELF Loan?

Firstmark Services is the loan servicer for the SELF program:

Borrower Customer Service: Toll-free 1-888-295-0713 (Automated 24 Hours)
Representatives are available: Monday - Friday 7:00am to 8:00pm Central Time
Loan information is also available via

Payment Address:
Firstmark Services
PO Box 2977
Omaha, NE 68103-2977

Correspondence Address:
Firstmark Services
Attn: Private Loans
PO Box 82522
Lincoln, NE 68501-2522

If, after calling Firstmark Services, you still have concerns about your SELF Loan, you are encouraged to send a letter or email to the Office of Higher Education explaining your concerns:

MN Office of Higher Education
PO Box 64449
St Paul, MN 55164


Glossary of Loan Terms

There are two main parts of a loan:

  • The principal -- the money that you borrow.
  • The interest -- that is like paying rent on the money you borrow.

You must also sign a promissory note in order to borrow any money. The promissory note is a contract between you and the lender that explains in detail what is expected from you and the lender. ALWAYS READ THE PROMISSORY NOTE CAREFULLY.

The following are some key characteristics and terminology concerning educational loans:

1. Application Fee

2. Capitalization

3. Co-signer

4. Default

5. Deferment

6. Disbursement

7. Forbearance

8. Guarantee Fee

9. Interest Rate

10. Loan Consolidation

11. Maximum Time to Repay

12. Minimum Payment

13. Origination Fee

14. Payment Consolidation

15. Servicing

1. Application Fee

Some lenders may charge an application fee for their alternative loans. This is a fee charged to process the application. It is usually not taken from the principal of the loan and must be paid when you apply for the loan, regardless of the loan amount.

2. Capitalization

Adding interest that has accrued onto the loan principal. Subsequent interest then begins to accrue on the new principal.

3. Co-signer

This is a person who signs the promissory note with the borrower and promises to repay the loan if the borrower does not. Both the co-signer and the borrower are responsible to repay the loan. Some loans require a co-signer and some don't.

4. Default

Being in default is defined differently for different loans. Basically, it means being delinquent in repaying a student loan more than a certain number of days or failure to comply with any of the other terms of the promissory note. Generally missing one payment does not mean the borrower is in default. IT IS IMPORTANT NOT TO DEFAULT ON YOUR LOAN.

Being in default subjects the borrower and co-signer to a variety of extra expenses and penalties. Generally the remedy for a default is more than just bringing the payments up to date. Sometimes it means you must repay the entire loan immediately.

If you default on a federal or state loan, your lender and the government can take a number of actions to recover the money, including:

  • Withholding your tax refunds.

  • Withholding part of your salary if you work for the federal government.

  • Suing and taking you to court.

  • Informing credit bureaus which might affect your credit rating. As a result, you may have difficulty borrowing money for a car or a house.

  • Requiring you to repay your debt under an income "contingent" or alternative repayment plan. You could end up repaying more than the original principal and interest on your loans!

  • Preventing you from obtaining additional state or federal student aid until you make satisfactory payment arrangements.

5. Deferment

This means that the payments on the principal of the loan will be delayed for a specified time. However, the interest must be paid or it is added to the principal. This means the loan will cost the borrower more in the long run, but it may make the loan easier for the borrower to repay.

6. Disbursement

This is when and how you get the money that you've borrowed. Generally the money is sent to the college and then given to you. Some colleges can transfer the money directly into the student's bank account.

If your educational program is short or if there is a short time remaining in the academic year, you might get all the money in one disbursement. If you will be in college for the whole academic year, the money is given to you in two or more parts.

7. Forbearance

An arrangement to postpone or reduce a borrower's monthly payment amount for a limited and specified amount of time, or to extend the repayment period. The borrower is charged interest during the forbearance.

8. Guarantee Fee

These fees are used to guarantee that lenders are repaid even if the lender can't collect on the loan due to default, death, or disability.

The guarantee fee is often taken from the principal before it is given to the borrower. This means the borrower will not be given all the money that is borrowed, but must still repay the total amount as if he or she had been given all the money.

9. Interest Rate

This is a percentage of the loan amount that you're charged for borrowing money. It is a re-occurring fee that you're required to repay, in addition to the principal. The interest rate is always recorded in the promissory note.

Sometimes, the interest rate remains the same throughout the life of the loan until it is all repaid. Other times, the interest rate will change every year, quarter (three months), monthly, or weekly based on some financial variable such as the interest rate of Federal Treasury notes.

Some lenders will lower the interest rate when the borrower makes a certain number of payments on time, has a co-signer for the loan, and so forth.

10. Loan Consolidation

Several loans are combined into one larger loan. The payment pattern and interest rate may change on the consolidated loans. The total payment may be smaller and the length of time for making repayments may be increased. This means the loan will cost the borrower more in the long run, but it may make the loan easier for the borrower to repay on a monthly basis.

11. Maximum Time to Repay

The promissory note will state the maximum time that the borrower can take to repay the entire loan. Read the promissory note carefully. The maximum loan repayment can be tied to:

  • When the student leaves college
  • When the money was borrowed

12. Minimum Payment

This is the smallest amount of payment that will be acceptable to the lender. Even if the loan is small, the borrower must make the minimum payment each month until the loan has been fully repaid.

13. Origination Fee

Processing the loan application and setting up the actual loan for disbursement to the borrower is called "originating" the loan. Some lenders may charge origination fees.

Often, the origination fee is taken from the principal before it is given to the borrower. This means the borrower isn't given all the money that's borrowed, but must still repay the total amount as if he or she had been given all the money.

14. Payment Consolidation

The monthly payments for several loans are combined into a single monthly payment or bill. The loans are still separate, but the payments are divided between the loans. The monthly payments are the total of all the separate payments. Check with your servicer or lender to see if this option is available.

15. Servicing

Servicing means taking care of the loan after the money is disbursed and until the loan is completely repaid. Many times servicing also means holding the record of the loan even after it has been repaid. Servicing includes:

  • Billing the borrower.
  • Recording payments.
  • Keeping track of the amount of money left to be repaid.

Sometimes the lender will change servicers or sell the borrower's loan to someone else who uses a different servicer.