THE POWER OF SUBSIDIZED STAFFORD LOANS!!

Stafford

• The Stafford program
  Staffords are student loans that are basic to the concept of "self help" and appear as part of most aid packages. The Stafford is an entitlement program. No credit check is necessary. Any student who has applied through the FAFSA form, is attending school at least half time, and has at least one full academic year of study remaining in an eligible program, has the right to borrow up to certain limits. Some students will qualify on the basis of calculated financial need for "subsidized" Stafford loans.
  
  If a student qualifies for a subsidized Stafford loan, the federal government pays interest on the Stafford loan while the student is in school at least half time and for six months thereafter. On unsubsidized Stafford Loans, interest accumulates from the time that the money is paid out. The student who borrows an unsubsidized Stafford Loan may choose to pay interest while in school or after she or he leaves school (or attends less than half time). Waiting to pay the interest means that the borrowed amount will be larger, as interest is "capitalized" -- it is continually being added to the original principal amount of the loan. Students who qualify for only a portion of their loan eligibility to be subsidized may combine a subsidized with an unsubsidized loan up to the limit in any enrollment period.
  
  Interest rates are set on July 1 of each year for loans disbursed through June 30 of the following year. For the year that begins July 1, 2008, the interest rate for subsidized Stafford Loans is fixed at 6.0%; the rate for unsubsidized Stafford Loans is fixed at 6.8%. Repayment need not begin until six months after the student completes school or drops below half-time enrollment.
  
  With passage of ECASLA (Ensuring Continued Access to Student Loans Act of 2008) additional unsubsidized Stafford Loans can be borrowed effective July 1, 2008. Generally, dependent college students can borrow an additional $2,000 per year in unsubsidized Stafford Loans. Independent students (and dependent students whose parents are ineligible for a PLUS loan) can borrow an additional $6,000 during their first two years, or $7,000 in later years.

Stafford Maximum 2009-2010 loan limits for Dependent undergraduate students for one full year of study:

Subsidized	plus	Unsubsidized	Total
$3,500		$2,000	$5,500	First Year
$4,500		$2,000	$6,500	Second Year
$5,500		$2,000	$7,500	Third & Remaining Yrs
$31,000	Maximum total debt for a dependent undergraduate (no more than $23,000 of which can be subsidized)

Students may not borrow more than the Cost of Attendance less other financial aid. If your COA for one year is $8,000 and you're awarded $6,000 in other aid, your borrowing limit for that year is $2,000. If parents of a dependent student can't pass a credit check and therefore cannot obtain a PLUS loan, then the dependent student may borrow from the Stafford program up to the same limits as an independent student.

Stafford Maximum 2009-2010 loan limits for Independent undergraduate students AND for dependent undergraduates whose parents are ineligible for a PLUS loan for one full year of study:

Subsidized	plus	Unsubsidized	Total
$3,500		$6,000	$9,500	First Year
$4,500		$6,000	$10,500	Second Year
$5,500		$7,000	$12,500	Third & Remaining Yrs
$57,500	Maximum total debt for an independent undergraduate (no more than $23,000 of which can be subsidized)

As with dependent students, the total amount borrowed cannot be more than the Cost of Attendance less other financial aid.

Stafford Maximum 2009-2010 loan limits for Graduate or Professional students for one full year of study:
Subsidized    plus     Unsubsidized     Total
$8,500                     $12,000             $20,500    per year

$138,500 = maximum total Stafford loan debt from all levels of study for a graduate or professional student (no more than $65,500 of which can be subsidized).

The total amount borrowed cannot be more than the Cost of Attendance less other financial aid. Graduate and professional students are, by definition, independent for purposes of federal aid.

Comments

[David]

The Student Finance Corporation helps students to get school loans for post secondary education. The eligibility is based on the student's financial conditions, repayment ability, credit and the college that the student is applying.

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