Master Promissory Notes

Understand the crucial fine print in a student loan promissory note

Before you receive any federal student loan, you'll be required to sign a Master Promissory Note, or MPN. Applicants should contact their school’s financial aid office to find out their preferred application method.

Private lenders do not have a master promissory note. Instead, they require students to apply each year, and those loan applications include a very different kind of student loan promissory note, notes which are good for only one year at a time.

What is a master promissory note?

Master promissory notes for federal loans are good for a period of up to ten years, and remain in force even if the student transfers to another school. Some schools will ask transfer students to sign a new MPN, to make sure they have the information on file. If your parents take out federal student loans on your behalf (a Federal Direct PLUS loan), they too will sign a master promissory note.

For most private student loans, the promissory note appears at the end of the online application process before submitting the application, however, this process differs for federal loans. For Federal Direct Student Loans you can go to your school's website for information or contact your schools financial aid office to understand their preferred process. Typically you execute this document online, at https://dlenote.ed.gov, using the same federal student aid PIN number you used for the FAFSA form. When you do so, you'll be able to retrieve a copy of the document online, any time you want.

By signing the master promissory note, you are legally agreeing to repay the lender, the U.S. Department of Education, for all loans—with interest—unless that interest is subsidized by the government(in some need-based cases)—made to you under the terms spelled out in the note. Naturally, that means you should read it very closely, and ask about anything you don't understand. Only sign when you've understood everything in the document.

Under federal regulations, your lender is obligated to notify you in writing or by electronic means whenever it makes a loan disbursement. That notice must include the date and the amount of the loan disbursement.

Additionally, schools are required to provide entrance and exit counseling to borrowers to inform them about the responsibilities of taking on a loan and requirement upon graduation from school. It's a good idea to take advantage of these sessions so you have an opportunity to answer all of your student loan questions.

Learn more about the affordable Citizens Bank TruFit Student Loan®

If you're interested in learning more, we have additional student loan resources to help you understand your options. Also, to help cover your college expenses, we have helpful information about our affordable Citizens Bank TruFit Student Loan®. If you have more questions, call a student loan specialist at 1-800-708-6684, and we'll help walk you through the college student loan application process.