FEDERAL LOAN TERMS FOR 2010-11

FEDERAL DIRECT STAFFORD LOAN

• Subsidized or Unsubsidized: determined by the FAFSA. 

• Subsidized Stafford Loan: need-based; the government pays the interest while the student is in school. 

  Unsubsidized Stafford Loan: student is responsible for the interest while in school; interest can be paid quarterly or capitalized and added to the loan principal until after the borrower ceases to be enrolled at least halftime.

• Annual Loan Amount:
  • Dependent Undergraduates: up to $5,500 for freshmen; $6,500 for sophomores; and $7,500 for juniors and seniors.
  • Independent Undergraduates: up to $9,500 for freshmen; $10,500 for sophomores; and $12,500 for juniors and seniors
  • Graduate Students: up to $20,500

• Interest Rate: as of July 1,2006, interest is a fixed rate.

   

  • Subsidized and Unsubsidized Loans borrowed from July 1, 2006 through June 30, 2008, are fixed at 6.8%.

   

  • Undergraduate Subsidized Loans borrowed during the dates listed below have fixed interest rates as listed. However, Undergraduate Unsubsidized Loans and both Graduate Subsidized and Unsubsidized Loans remain at 6.8%
    • July 1, 2008 through June 30, 2009 - fixed at 6.0%
    • July 1, 2009 through June 30, 2010 - fixed at 5.6%
    • July 1, 2010 through June 30, 2011 - fixed at 4.5%
    • July 1, 2011 through June 30, 2012 - fixed at 3.4%

  • Loans borrowed for academic terms prior to July 1, 2006 have variable interest rates, capped at 8.25%; rate for July 1, 2009 through June 30, 2010 is 1.88%.

• Loan Fees: reduce loan proceeds by .5% for 2010-11 to determine amount that will credit to your account (i.e. if loan is $5,000, amount credited is $4,975). 
• Repayment: begins six months after the student ceases to be enrolled at least halftime; several repayment options available; the standard plan provides up to 10 years for repayment. Further information regarding repayment options, loan deferment and loan forgiveness programs is available at www.studentaid.ed.gov.

FEDERAL DIRECT PARENT PLUS LOAN      

• Loan Amount: up to the cost of education minus any other financial aid.
• Interest Rate: as of July 1, 2006, interest was fixed at 7.9% on the Federal Direct Parent Loan. (Loans borrowed for academic terms prior to that time have variable interest rates, capped at 9%; rate for July 1, 2009, through June 30, 2010, is 3.28%).
• Loan Fees: reduce loan proceeds by 2.5%  for 2010-11 to determine amount that will credit to student's account (i.e. if loan is $10,000, amount credited is $9,750).
• Approval: a credit check is completed by the federal government when loan is processed. Parent will be notified whether or not loan is approved.
• Repayment: begins two months after the loan is fully disbursed. However, please note that payments on Federal Parent PLUS Loans disbursed July 1, 2008, or after, may be deferred upon request while the student is enrolled at least half-time. Interest will accrue and may be paid or added to the principal when the child is no longer enrolled.

FEDERAL PERKINS LOAN

• Interest Rate: 5%; interest free while the student is enrolled at least halftime.
• Repayment: begins nine months after the students ceases to be enrolled halftime; minimum of $50/month; maximum repayment period is 10 years.  Additional information regarding repayment, deferment and cancellation options is available at www.studentaid.ed.gov.

FEDERAL DIRECT GRADUATE PLUS LOAN

• Loan Amount: up to the cost of education minus any other financial aid.
• Interest Rate: interest is fixed at 7.9%
• Loan Fees: reduce loan proceeds by 2.5%  for 2010-11 to determine amount that will credit to student's account (i.e. if loan is $10,000, amount credited is $9,750).
• Approval: a credit check is completed by the federal government when loan is processed. Student will be notified whether or not loan is approved.
• Repayment: deferred while student is enrolled at least half-time. Interest will accrue and may be paid while in school or added to the principal when the student is no longer enrolled.