Federal Family Education Loan and Other Federal Aid Programs
Subsidized Stafford Loan
The Office of Financial Aid awards subsidized loans based on financial need. The federal government pays the interest to the lender until the borrower begins repayment. The maximum amount a student may borrow in any single year as a subsidized loan is equal to the cost of attendance minus the sum of all forms of financial aid already awarded minus the EFC, not to exceed the limits outlined below. The lender charges interest to the borrower beginning with the first repayment of the loan.
Unsubsidized Stafford Loan
The Office of Financial Aid does not award unsubsidized loans based on financial need. The federal government does not make interest payments for the borrower. The maximum a student may borrow in a single year is equal to the cost of attendance minus the sum of all forms of financial aid already awarded, not to exceed the limits outlined below. The lender charges interest to the borrower from the time the lender disburses the loan until the student pays it in full.
Stafford Loan Amounts and Limits
Eligible students enrolled at least half-time may qualify for a federal Stafford loan. Dependent students can borrow up to $2,625 per year for level I, $3,500 per year for level II, and $5,500 per year for levels III, IV, and V. The cumulative maximum for dependent students is $23,000. The maximum amount independent students, or dependent students whose parents are not eligible for a PLUS loan, can borrow is $6,625 (up to $2,625 of this as subsidized) per year for level I, $7,500 (up to $3,500 of this as subsidized) for level II, and $10,500 (up to $5,500 of this as subsidized) for levels III, IV, and V. The cumulative maximum for independent students, or dependent students whose parents are not eligible for a PLUS loan, is $46,000 (up to $23,000 of this as subsidized). The interest rate varies, but will not exceed 8.25%. Repayment begins six months after a student graduates, withdraws, or drops below half time enrollment. The processing fee for Stafford loans is 2% or 3%, depending on the lender.
Unsubsidized Loan for Parents (PLUS)
A parent or legal guardian of a dependent student enrolled at least half time is eligible to apply for a PLUS loan. The parent or guardian applying for the loan must also be a citizen or resident of the United States, pass a credit check, and not be in default or owe a refund to any student financial assistance program. Repayment begins within 60 days after the lender disburses the final portion of the loan. The yearly limit on a PLUS loan is equal to the cost of attendance minus the sum of all other forms or financial aid already awarded. The interest rate is variable but will not exceed 9.0% and begins to accrue as soon as the lender disburses the loan. The processing fees for PLUS loans is 3%.
Federal Perkins Loan
The Office of Financial Aid awards Perkins loans based on financial need. Repayment begins nine months after a student graduates, withdraws, or drops below half time enrollment. Students can defer repayment for certain kinds of federal and volunteer service. Students may borrow up to $4,000 per year for all levels. The cumulative maximum is $20,000. The interest rate is 5.0%, and begins with the first loan repayment. There is no processing fee on Perkins loans.
Veterans Administration Education Benefits
Various programs are available for veterans, reservists, and their dependents. Students can obtain information and applications from state veterans affairs offices. Students should consult the policies on transferring credits from other sources.
The Federal Department of Education provides a complete list of federal financial aid programs and policies.