The Federal Stafford Loan is the most popular low-interest federal loan. Stafford loans are for undergraduate and graduate students. The loan is insured by the federal government and offers flexible repayment options. Schools that participate in the William D. Ford Federal Direct Loan (Direct Loan) Program offer Stafford Loans.
There are two types of Federal Stafford Loans: subsidized and unsubsidized. Depending on household income, a student can be eligible for one or both varieties of student loans. The school specifies for which loans the student is eligible. Due to rates and repayment policy, Stafford Loans are the second thing a student should pursue, after conducting a scholarship search. If you aren't able to completely fund your college education with scholarships, the Stafford is the first loan option you should consider.
Each year, dependent undergraduate students can borrow up to:
Each year, independent undergraduate students or a dependent students whose parents were unable to get a PLUS Loan can borrow up to:
The student is responsible for all interest that accumulates while they are in school, in deferment, and during the grace period. Students can take out both subsidized and unsubsidized loans as long as they do not exceed Stafford yearly borrowing limits.
$20,500 (unsubsidized only) for graduate/professional students who are independent students. There are no dependent loan options for graduates.
$31,000 for dependent students where no more than $23,000 can be subsidized loans for subsidized and unsubsidized aggregate loan limits.
-$57,500 for independent students where no more than $23,000 can be subsidized loans - is the limit for undergraduates when it comes to subsidized and unsubsidized aggregate loan limits. $138,500 for graduate or professional students where no more than $65,500 can be subsidized loans – is the limit for independent students for subsidized and unsubsidized aggregate loan limits.
For more information on Federal Stafford Loans, visit www.studentaid.ed.gov.
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