Loans - Stafford

IMPORTANT!

Due to the signing of the Health Care and Education Reconciliation Act of 2010, Stafford and PLUS Loans will be through the William D. Ford Direct Lending (DL) Program.  Under the Direct Loan Program, Stafford  and PLUS Loan funds come directly from the U.S. Department of Education.

Subsidized

A subsidized loan is awarded on the basis of financial need. If you're eligible for a subsidized loan, the government will pay (subsidize) the interest on your loan while you're in school, for the first six months after you leave school, and if you qualify to have your payments deferred. Depending on your financial need, you may borrow subsidized money for an amount up to the annual loan borrowing limit for your level of study.  The interest rate is 4.5% for 2010-11 and 3.4% for 2011-12 for Undergraduates; 6.8% for Graduates.

Unsubsidized

Unlike a subsidized loan, you are responsible for the interest from the time the unsubsidized loan is disbursed until it is paid in full. You can choose to pay the interest or allow it to accrue (accumulate) and be capitalized (added to the principal amount of your loan). Capitalizing the interest will increase the amount you have to repay. The interest rate is a fixed 6.8%.

Loan origination fees of 1% will be deducted, with an up-front interest rebate (repayment incentive) of 0.5%.

Annual loan limits reflect the maximum combined borrowing from both the subsidized and unsubsidized programs. The annual grade level loan limits are as follows:

Freshman (0-29 earned credit hours) -- $5500

 

Sophomore (30-59 earned credit hours) -- $6500

 

Junior (60-89 earned credit hours) -- $7500

 

Senior (90-125 earned credit hours) -- $7500

 

Graduates -- $8500

The combination of subsidized and unsubsidized loans cannot exceed the lifetime maximum of $31,000 for Undergraduates and $138,500 for Graduates.