What Kind of Federal Student Loans are Available?
Federal Direct Subsidized Stafford Loans:
Student borrowers are not charge interest while attending school at least half-time, during deferments, and sometimes during grace period. Repayment begins six months after graduation, withdrawal from college, or dropping below half-time status.
NEW! Federal Direct Subsidized loans disbursed on or after July 1, 2012 through June 30,2014 are no longer eligible to receive the interest subsidy during grace period.
Eligibility: The student must demonstrate financial need and be enrolled at least half-time. The financial aid office makes the determination of eligibility using the results of the Free Application for Federal Student Aid (FAFSA).
Interest Rate: Loans disbursed on or after July 1, 2012 through June 30, 2013: 6.8% fixed for undergraduate students
NEW! Graduate students are no longer eligible to receive subsidized loans beginning July 1, 2012 through June 30, 2014.
Fees: Beginning July, 1, 2012 through June 30, 2014, a fee equal to 1.0 percent will be withheld from Stafford loan proceeds and retained by the U.S Department of Education.
Repayment: Begins 6 months after graduating, dropping below half-time or withdrawing from school. Several repayment options are available. Contact your loan servicer to determine what payment option is best for your situation.
Limit: (see chart)
Federal Direct Unsubsidized Stafford Loans:
Financial need is not a requirement to qualify for this type of loan. The borrower is responsible for the interest that accrues beginning the day the first disbursement occurs. Borrowers can choose to pay interest or have it deferred until repayment begins. If deferred, the outstanding accrued interest will be capitalized or added to the principle of the loan. If you wish to make interest-only payments, contact the servicer of your loan.
Eligibility: Students do not have to demonstrate need to be eligible for this loan, however, a FAFSA must be on file in order to qualify. The student must be enrolled at least half time. The financial aid office determines eligibility.
NEW! Beginning July 1, 2012 through June 30, 2014 graduate students will only be eligible to receive Unsubsidized Stafford loans.
Interest Rate: 6.8 percent fixed.
Fees: Beginning July, 1, 2012 through June 30, 2014, a fee equal to 1.0 percent will be withheld from Stafford loan proceeds and retained by the U.S Department of Education.
Repayment: Begins 6 months after graduating, dropping below half-time or withdrawing from school. Several repayment options are available. Contact your loan servicer to determine what payment option is best for your situation.
Limit: (see chart)
NOTE: Depending on the financial need demonstrated by the undergraduate student, the student may qualify for a combination of both subsidized and unsubsidized loans. The federal government sets annual and aggregate loan limits based on the student's year in school and whether they are dependent or independent students.
How to complete a Federal Stafford Loan Master Promissory (MPN):
You can complete both Loan counseling and the MPN by going to www.studentloans.gov.
NOTE: If you are a first time borrower, you must complete online loan Entrance Counseling along with the MPN.
Students who are not new borrowers should contact the financial aid office to determine if a new MPN is required for them to receive loans.
You will need your Federal Student Aid Personal Identification Number (FAFSA PIN) to complete the Master Promissory Note (MPN). If you do not know your PIN, you can request a duplicate PIN by going to www.pin.ed.gov website.