Federal Student Loans

Federal loans

These loans are part of student financial aid packages and are determined by information submitted on the FAFSA. They:

have fixed interest rates
can be interest free while in school
are deferred while in school at least half time

Loan	Amount	Interest rate
Federal Direct Stafford Loans	$5,500* - first year (up to $3,500 subsidized) $6,500* - second year (up to $4,500 subsidized) $7,500* - other years (up to $5,500 subsidized)	3.4 % fixed rate for subsidized loans and 6.8% fixed rate for unsubsidized loans
Federal Perkins Loan	Up to $2,000 for the first and second year (subsidized)	5% fixed rate (subsidized)

*Independent students are eliglible for an additional $4000 of unsubsidized loan per year

Repayment

Repayment of federal student loans is not required* until you graduate or are enrolled in college less than half time. Once you complete school, you are given a grace period before repayment begins. You have 10 years to repay your federal student loan under standard repayment.

Federal loan	Repayment begins
Federal Perkins Loan	9 months after leaving school or enrolled less than half time
Federal Direct Stafford Loan	6 months after leaving school or enrolled less than half time

*You may start repaying your loans or loan interest while you are still in school.

Subsidized or unsubsidized?

Subsidized loans: The government pays (subsidizes) the interest on the loan while you are in school at least half time, during the grace period after you leave school and if you qualify to have payments deferred.

Unsubsidized loans: Interest accrues on an unsubsidized loan from the time it is first paid out. You can pay the interest while you are in school and during the grace period and deferment period, or you can allow it to accrue and be capitalized (added to the principal amount of your loan. If you choose not to pay the interest as it accrues, this will increase the total amount you have to repay because you will be charged interest on a higher principal amount.