Understanding Federal Stafford Loans


Students who will be needing additional funding to pay for their college have a number of options available to them including applying for private and federal student loans. Federal Stafford loans are are fixed-rate federal student loans available to undergraduate and graduate students provided that they are enrolled in school at least half time. Stafford loans are the most common and one of the most cost effective ways that students can pay for college.

college studentThere are two types of Federal Stafford Loans – subsidized and unsubsidized. Subsidized loans are needs based and interest does not accrue while students are still in school or during the sixth month deferment period after completing their education. In addition, if an authorized deferment is taken, interest is not accrued during that period either.

For unsubsidized student loans, interest accrues while the student is still in school, although payments do not begin until six months after they finish their education.

In order to qualify for a Federal Stafford Loan applicants must do the following as per the federal government:

  • You must have submitted a FAFSA to be eligible for a Stafford loan. FAFSA is the “Federal Application For Student Aid” form.
  • For subsidized Stafford loans, you must have financial need as determined by your school.
  • You must be a U.S. citizen or national, a U.S. permanent resident, or eligible non-citizen.
  • You must be enrolled or plan to enroll at least half time. If you receive a Stafford loan and don’t maintain your halftime status or if you quit your studies, then you’ll need to begin making payments on your loan six months later.
  • You must be accepted for enrollment or attend a school that participates in the Federal Family Education Loan Program. Not all schools participate; check with your Bursar office to learn if they do.
  • You must not be in default on any education loan or owe a refund on an education grant.

With a Federal Stafford Loan there is no set deadline for applying however students should note that their school could have deadlines imposed of their own. If you are approved for a loan, money will be sent directly to your school in two installments covering the fall and spring semesters. Funds can be used to pay for tuition, books, room and board, and other education related expenses.

Of course, there are other things you need to learn about a Federal Stafford Loan before you apply. Visit the Federal Stafford Loan site or Sallie Mae for information about these types of loans.

College is expensive, but you can find competitive loans to help pay for your education by comparing federal and private lending options.

Adv. — Are you considering a federal parent PLUS loan? If so, visit your Sallie Mae lender for more information or call them directly at 866-530-9523.


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Categories: Student Loans