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The Federal Stafford Loan Program contains two components:

  • The Direct Subsidized Federal Stafford Loan, a need-based loan
  • The Direct Unsubsidized Federal Stafford Loan, a non-need-based loan

The terms of the two loans are almost identical, except that the Subsidized Federal Stafford Loan does not accrue interest as long as the borrower maintains at least half-time attendance at an eligible institution, or during the six-month grace period after such enrollment ceases.

Subsidized Stafford Loans will no longer be available to graduate students for award periods that begin after July 1, 2012. Unsubsidized Stafford Loans will continue to be available to graduate students.

Loan Amount & Interest Rate Information

  • The maximum amount that may be borrowed under the Federal Stafford Loan Program is $20,500 per academic year

  • The lifetime aggregate Federal Stafford Loan Program limit is $138,500, of which up to $65,500 can be subsidized Federal Stafford Loans. These limits include loans from undergraduate study.

  • The interest rate for Stafford Loans made after July 1, 2013 is a fixed rate, but the fixed rate is revised each year.  A student might wind up with loans with several different fixed rates after finishing their degree. For graduate-student Unsubsidized Stafford Loans made between July 1, 2013 and June 30, 2014, the fixed rate is 5.41%.

  • The Unsubsidized Federal Stafford Loan accrues interest during in-school, grace, and deferment periods, and that interest may be either capitalized or paid, at the student's option

    • If capitalized, most lenders will add the accrued interest to the principal loan amount when the loan enters repayment. Since this varies from lender to lender, it is recommended that you contact your lender regarding the way they will handle accrued interest.

  • Repayment commences six months after the student stops being enrolled at least half-time at an eligible institution.

Loan Disbursement Information

  • In the typical case where the loan period covers two trimesters, half of the loan amount is disbursed at the beginning of each term.

  • For loans with a first disbursement on or after July 1, 2013, fees of 1.051% will be taken out of each disbursement.

The Federal Stafford Loan Application Process

Students wishing to receive Federal Stafford Loans must:

  1. Submit a FAFSA to establish eligibility for federal student aid.

  2. Students must also complete a CWSL Online Aid Application to specify that they wish to receive federal student loans.

  3. Once the financial aid office has assembled the student's aid package, and the student has accepted one or more loans, the loan certification will then be electronically transmitted to the Direct Loan Servicer, who will then send a Master Promissory Note to the student for completion if one is not already on file. Promissory notes may also be completed on the website.

  4. Upon disbursement, the school will apply your loan proceeds directly to your student account.

First-time Stafford borrowers must complete entrance counseling at prior to receiving funds.

Be sure to read your promissory note carefully, as it is your responsibility to understand the terms of the loans for which you are applying. Retain copies of all loan documents for your records.