Federal Direct Loans
Federal Direct Stafford Loans are also referred to as Direct Loans or Federal Direct Loans. The lender of these loans is the U.S. Department of Education and repayment is to the Department. Between 10 and 30 years to repay, depending on amount owed and type of repayment selected.
You must apply for financial aid using the FAFSA. You will not be automatically offered a Direct Loan. If you want to borrow from the Direct Loan program you must request the loan from the financial aid office. If you request a Direct Loan and later decide you do not need the funds, you may decline the loan by contacting the financial aid office.
Qualifying Credits and Program
You must take at least 6 credits per semester. You must be accepted for admission to a degree-seeking program (this includes eligible certificate programs).
If you are an undergraduate student and have financial need you are eligible for a subsidized Direct Loan. With subsidized loans no interest will be charged as long as you maintain at least half-time enrollment (6 credits). Financial need is the difference between Cost of Attendance and your Expected Family Contribution.
Interest Rate and Repayment for subsidized loans
Subsidized loans taken between 7/1/2014-6/30/2015 are charged a fixed interest rate of 4.66%. The interest will not change throughout the life of the loan. There is no interest charged on your subsidized loan as long as you maintain half-time enrollment at the college. The interest rate varies each year on new loans and is adjusted each July 1st.
The unsubsidized loans are charged an interest rate of 4.66% and is available to students who do not qualify for the subsidized loan. The difference of the unsubsidized loan is that interest accrues while the student attends school. You are eligible to receive an unsubsidized Direct Loan to replace all or a portion of the family contribution if there is loan eligibility remaining.
Interest Rate and Repayment for Unsubsidized loans
Beginning 7/1/2014 the interest rate is a fixed 4.66% during in-school, grace and deferment periods and is also 4.66% during repayment. The interest will not change throughout the life of the loan. If you borrow an unsubsidized Stafford Loan, you have the option of paying the interest as it accrues or you can let it be added to the principal of the loan. The interest rate varies each year on new loans and is adjusted each July 1st.