Federal Subsidized Stafford Loans

Most students who file a FAFSA are awarded a Federal Stafford Loan. A Federal Parent Loan for Undergraduate Student (PLUS) is available to parents of dependent students.

The Federal Subsidized Stafford Loan Program provides low-interest, deferred-payment loans to undergraduate and graduate students who demonstrate financial need. Need is calculated based on the FAFSA along with the cost of school and other financial aid. These funds help students with educational expenses. The federal government “subsidizes’ the interest on these loans before repayment begins or during periods of deferment.


A student must be a US citizen or permanent resident, an undergraduate or graduate student enrolled at least half-time, completed a FAFSA, maintain satisfactory academic progress, and not exceeded annual or lifetime aggregate loan limits. No credit check is required.


After graduation from college, dropping below half-time, or leaving school for any other reason, a student receives a 6-month grace period before starting repayment. There are a variety of repayment options and a student may be eligible to postpone payments through deferment or forbearance. Repayment is usually based upon a 10-year plan. In certain circumstances, a person may be allowed up to 25 years for repayment.

Interest Rate and Origination Fee

The interest rate for Federal Stafford loans is variable, but does not exceed 8.25%. The rate is adjusted each year on July 1. An origination fee of up to 3 percent of the loan is charged for Federal Stafford Loans. The fee is deducted proportionately from each loan disbursement received.