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.

Federal Stafford Loans are low-interest loans offered to undergraduate and graduate students attending accredited schools at least half-time. Eligible expenses include tuition and fees, room and board, books and supplies, transportation and a living allowance. Federal Stafford Loans are either subsidized or unsubsidized. A student may receive a subsidized and an unsubsidized loan during the same enrollment period.

Eligibility

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.

Repayment

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.

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