Federal Direct Stafford Loan
Available to all matriculating students enrolled at least half-time, regardless of need, provided they are a U.S. citizen or permanent resident and are not in default on previous federal loans. Annual loan amount is determined by the student's grade level.
Maximum annual loan limits based on grade level for dependent undergraduate students are as follows:
- $3,500 Subsidized* + $2,000 Unsubsidized Federal Direct Loan: Freshmen (0-26 credits earned)=$5,500 TOTAL
- $4,500 Subsidized* + $2,000 Unsubsidized Federal Direct Loan: Sophomore (27-56 credits earned)=$6,500 TOTAL
- $5,500 Subsidized* + $2,000 Unsubsidized Federal Direct Loan: Junior/Senior (57 + credits earned)=$7,500 TOTAL
*Whether loan is Subsidized is based on financial need as determined by the FAFSA. If student as no financial need, total annual Unsubsidized Stafford Loan eligibility would be: $5,500 as a freshman, $6,500 as a sophomore, $7,500 as a junior or senior.
Maximum annual loan limits per grade level for independent undergraduate students or for dependent undergraduate students whose parents are denied on the Federal Direct PLUS Loan are as follows:
- Freshman: $3,500 Subsidized* Federal Direct Stafford + $6,000 Unsubsidized Federal Direct Stafford=$9,500 TOTAL
- Sophomore: $4,500 Subsidized* Federal Direct Stafford + $6,000 Unsubsidized Federal Direct Stafford=$10,500 TOTAL
- Junior & Senior: $5,500 Subsidized* Federal Direct Stafford + $7,000 Unsubsidized Federal Direct Stafford=$12,500 TOTAL
*Whether loan is subsidized or unsubsidized is based on financial need.
Student is the primary borrower and repayment is deferred until six months following graduation, provided the student remains enrolled at least half-time. Standard repayment term is 10 years. Students with financial need may be eligible for a subsidized Federal Direct Stafford Loan (i.e.-federal government pays the interest on the loan while the student is enrolled). Students that take the Unsubsidized Federal Direct Stafford Loan have the option of making quarterly payments on the interest if they desire. The interest rate for all Direct Stafford Loans for undergraduate students with a first disbursement date on or after July 1, 2014, is 4.66%. The interest rate for all Direct Stafford Loans for graduate students with a first disbursement date on or after July 1, 2014 is 6.21%. The rate is fixed for the life of the loan. The Federal Direct Stafford Loan origination fee is 1.073% for Stafford Loans disbursed October 1, 2014 and after (for loans with first disbursements prior to October 1, 2014 it is 1.072%).
Example: A student borrows a $5,500 Federal Direct Stafford Loan for the year. Net proceeds student will receive on a $5,500 Stafford Loan=$5,441, split over two disbursements, once the 1.072% origination fee is deducted by the government.
To keep the up-front interest rebate, a borrower must make his/her first twelve required monthly payments on-time. Calculate your Federal Direct Stafford Loan monthly payments upon graduation/completion of your program via the online loan calculator.
To Apply for a Federal Direct Stafford Loan:
For the Summer 2014/Fall 2014/Spring 2015 Semesters:
1. Complete a 2014-15 Undergraduate Student Federal Direct Stafford Loan Acceptance Form.
2. Complete the Federal Direct Loan MPN* at www.StudentLoans.gov. Federal PIN required.
3. Complete a Federal Direct Loan Entrance Counseling Session* at www.StudentLoans.gov.
*Required only for first-time Federal Direct Stafford Loan borrowers.
**See Arcadia's Lender Partnership Code of Conduct for more information on the selection of private education lenders.
Borrowers with Older Variable-Rate Loans: Rate Changes
- All unconsolidated Stafford and Parent PLUS loans borrowed before July 1, 2006 have fixed interest rate. Borrowers with these older loans can consolidate them to lock in a low fixed rate in 2012-13. However, borrowers should be cautious about combining Stafford and Parent PLUS loans. Consolidation loans that include Parent PLUS loans (as well as individual Parent PLUS loans) are not eligible for Income-Based Repayment (IBR).
For 2012-13, the variable rate for Stafford loans issued between July 1, 1998 and June 30, 2006 is 2.39% during repayment and 1.79% during in-school, grace, or deferment periods. Any borrower with these loans can consolidate at a fixed rate of 2.50% during 2012-13. If 2012 graduates have these older loans, they can consolidate during their six-month grace period to lock in an even lower rate of 1.88%.
When consolidating multiple loans, the new fixed rate will be a weighted average of the rates of the consolidated loans, rounded to the nearest eighth of a percentage point. New consolidation loans are made through the Direct Loan program, and only Direct loans qualify for Public Service Loan Forgiveness.
Links to More Information
Not sure what kind of loan you have or whether you've already consolidated? Check the National Student Loan Data System to be sure. If you can't remember your PIN number, you can get a new one.
If you have questions about federal student loans, contact the Federal Student Aid Information Center toll free at 1-800-4-FED-AID.