Federal Direct Loan Program is a program that provides low-interest loans for students and parents. Students must be enrolled at least half-time to receive a loan. An origination/guarantee fee of 1-4% may be assessed prior to each disbursement. The interest rates are determined annually in June. If the student is financially eligible for the loan, the Federal government will pay the interest while the student is in school. If they are not financially eligible, the student is responsible for the interest and may pay it while attending school or have it added to the principal for later repayment. Repayment of principal and interest begins six months after the student ceases to be enrolled at least half-time.
Federal Direct Subsidized Stafford Loan
Students may borrow up to $23,000 for undergraduates.
Additional Unsubsidized Stafford Loan
Dependent students may borrow $2,000 per year for four years. Independent students may borrow additional amounts listed. The student is responsible for the interest and may pay it while attending school or have it added to the principal for later repayment.
Dependent students may borrow a maximum of $8,000. Independent students may borrow a maximum of $57,500.
Federal PLUS Loan
Parents of students may borrow annually the amount of the student's cost of education minus other aid for each child who is enrolled at least half time and is a dependent undergraduate student. PLUS is limited to parents who do not have an adverse credit history. Late payments on outstanding obligations are not to be considered as having adverse credit history. The current interest rate is 6.84%, with the borrower beginning payment within sixty days of final loan disbursement for the school year. Graduate students may also borrow under the PLUS loan program. They have to meet the same credit history requirements, must apply for Federal financial aid and may borrow up to the cost of attendance less other financial aid. As with the Parent PLUS, the current interest rate is 6.84%. Some lenders may require in-school deferments each term.
The process for receiving some federal student loans, including Federal Perkins Loans and Direct PLUS Loans for parents, is different. To learn more about these and other federal student loans, visit http://www.studentaid.gov/loans. To get information on loan repayment, visit https://www.studentaid.gov/repay.