Student Loan Law Article
Stafford Loan.
Federal Stafford loans first issued July 1st, 2006. This fixed low interest rate loan is for students in accredited schools attending at least half time. It is the most common loan students use to fund their education. For students, Federal Stafford loans offer a great financial opportunity. Federal Stafford loans are government secured loans at low interest rate for students. You can opt for no repayment until after graduation. It is also eligible for Student Loan Consolidation.
Subsidised Stafford loans are offered to students who have proven financial need. The government pays the interest while an undergraduate, but once graduated you are responsible for the loan and interest. All students are eligible for unsubsidised Stafford loans. Financial need is not an issue. The moment the loan is issued, you become responsible for repayment and interest. You can, however, defer payment until after graduation but interest would have accrued during that time.
Students who depend on parents for financial help can borrow in the first year $2,625, second year $3,500 and the third and fourth year $5,500. Student considered independent can be granted a further loan of $4000 in the first two years and $5000 in the next two years. An independent student is over 24 years, a graduate, married, US armed Forces veteran, or ward of court.
If the Federal Stafford loan will not satisfy all your financial needs, then parents of dependent students can take out a Federal Parent Loan for Undergraduate Students (PLUS). With a Federal PLUS, parents can borrow up to the total cost of a student’s education at a low interest rate. It is also eligible for consolidation.
To qualify for a Federal Stafford loan, you have to submit a FAFSA. To qualify for a subsidised Federal Stafford loan, you must demonstrate financial need. You must be a US citizen, a permanent resident or eligible non-resident.
