Federal Loans

Student loans, unlike grants and work-study, are borrowed money that must be repaid, with interest, just like car loans and mortgages. You cannot have these loans canceled because you didn't't like the education you received, didn't get a job in your field of study or because you're having financial difficulty. Loans are legal obligations, so before you take out a student loan, think about the amount you'll have  to repay over the years.  To find out more information about federal loans, please visit the U. S. Department of Education's website at http://studentaid.ed.gov/.

Federal Perkins Loans:

• Made through participating schools to undergraduate, graduate and professional students.
• Offered by participating schools to students who demonstrate the greatest financial need (Federal Pell Grant recipients get top priority).
• Made to students enrolled full-time or part-time.
• Repaid by you to your school.
• Stafford Loans are for undergraduate, graduate and professional students. You must be enrolled as at least a half-time student to be eligible for a Stafford Loan.

Loan Information:

• The maximum loan amount is $4,000 per year for undergraduates; $6,000 for graduates.
• Priority is given to those with exceptional need
• Repayment of Perkin Loans begin nine months after student status drops to less than half-time; up to 10 years to repay.
• Current interest rate is 0% while in school and 5% during repayment.
• In order to be eligible, students must file the FAFSA

Federal Stafford Loans:

Stafford Loans are for undergraduate, graduate and professional students. You must be enrolled as at least a half-time student to be eligible for a Stafford Loan. 

Subsidized Stafford Loan: 

• Available to students who demonstrate financial need.
• Eligible students can borrow a subsidized FFEL or Direct Loan to cover some or all of their need.
• For a subsidized loan, the U.S. Department of Education pays the interest:
• While you're in school at least half-time.
• For the first six months after you leave school.
• During a period of deferment (a postponement of loan payments).
• The amount of your subsidized loan cannot exceed your financial need.

Loan Details:

• Up to $3,500 for first year students
• Limits are $5,500 a year for remaining undergraduate years
• Repayment begins 6 months after student status drops less than half-time
• Up to 10 years to repay
• Fixed interest rate of 6.8% as of July 1, 2006
• Federal Government pays interest while student is in school
• Must file the FAFSA to be eligible

Unsubsidized Stafford Loan: 

• Available to students who do not have financial need.

Loan Details

• Dependent students may borrow up to $3,500, less any eligibility for the subsidized Federal Stafford Loan
• Same interest and repayment terms as the Subsidized Federal Stafford, except that interest is not subsidized and will accrue during in-school and during six month grace periods

Federal Parent Loan for Undergraduate Students (PLUS)

• Parents must have no adverse credit
• Annual loan limit is the dependent student's cost of education minus any financial aid received
• Repayment begins within 60 days of disbursement
• Up to 10 years to repay

How do I apply for a Perkins or Stafford Loan?

As with all federal student financial aid, you apply for a Perkins or Stafford Loan by completing the FAFSA. A separate loan application is not required. However, you'll need to sign a promissory note, which is a binding legal contract that says you agree to repay your loan according to the terms of the promissory note. Read this note carefully before signing it and save a copy for your records.