Federal Stafford Loan Disbursement Process
Lender disburses loan funds to school
After the guarantor approves the loan and the lender/loan agency completes the loan application process, the lender/loan agency will disburse the funds to MSU for eligible students. If there are two semesters within the loan period, the lender/loan agency will disburse one-half of the loan for the first semester and the other half for the second semester, unless the first semester is past, then the lender/loan agency may disburse the entire loan in one disbursement. If there is only one semester within the loan period, then the lender/loan agency will disburse the loan in one disbursement.
School processes loan disbursement
When the disbursement arrives on campus, the Student Loan Office and Account Services processes it for delivery to the student after the student meets all the eligibility requirements, which includes the entrance counseling requirement for first-time MSU students and at least half-time enrollment for each semester within the loan period . Click here for online Entrance Counseling. Most lenders send disbursements to MSU as an Electronic Funds Transfer (EFT) through the National Disbursement Network (NDN), but a few lenders may send a paper check, which takes more time to process than an EFT. If the disbursement is an EFT, MSU will automatically apply the funds directly to the eligible student's MSU student account. If the disbursement is a check, the student must endorse the check at Account Services before the funds can be applied to the student's MSU student account. (Please note that federal regulations prohibit MSU from disbursing Federal Stafford Loan funds after 120 days from the end of the loan period).
Student receives loan funds
If the student has a credit balance (excess funds over tuition, fees and other charges) after the funds are applied to the student's MSU student account, Account Services will issue a refund to the student. A refund is available to the student either by direct deposit through Bull-e-bucks or by paper check. (Direct Deposit /Bull-e-bucks refunds are generally available three business days prior to final registration. Paper check refunds are available the first day of final registration). Please review your Student Account information on the MSU Intranet at https://mybanner.msstate.edu to see if your EFT disbursement has been applied to your account.
