ACC uses 5 criteria when determining loan recipients.
The Application Review Committee will determine the loan amount given to each student and the repayment period based on the strength of their application. amount requested, and amount of funds raised during that calendar year.
ACC will only give loans to students who can realistically pay back their total loan within 4 years. No loan lifespan can exceed the 4-year maximum. If an applicant cannot pay back their loan within 4 years then a lesser amount may be loaned out which that person can payback with 4 years maximum time.
When determining a recipient’s minimum monthly repayment the application review committee will determine the maximum a recipient can repay without it becoming a burden on the recipient. However minimum monthly payment is started immediately after the loan is awarded.
In Islam, a loan is a form of Sadaqah (charity). In those cases where a student is unable to meet their minimum monthly payments due to financial hardship then ACC must contact the student in order to determine a new minimum monthly payment. This flexibility may modify the minimum monthly repayment and may extend the lifespan of the loan. This flexibility reflects the mercy and compassion demonstrated in the Quran and Sunnah and will be determined by the ARC.
Loans are Sadaqah
As mentioned above, loans are a form of Sadaqah. We still believe that students are obliged to repay their loans; however in cases where a student is unable to due to loss of work, injury, or other life circumstances ACC will work with them to reassess their loan repayment. In some cases we may choose to reduce the monthly amount, reduce payments to $0, or forgive the loan entirely.
Only in those cases when a student refuses to repay their loan without any life changing circumstances will ACC take action to ensure repayment, which are listed below: