Funding Your Education 1997-98

Federal and Direct Stafford Loans (part 2 of 2)

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How much can I borrow?

What's the interest rate on these loans?

When do I pay back these loans?

How much can I borrow?

If you're a dependent undergraduate student, you can borrow up to the following amounts:

• $2,625 if you're a first-year student enrolled in a program of study that is at least a full academic year;
  
  
• $3,500 if you've completed your first year of study and the remainder of your program is at least a full academic year;
  
  
• $5,500 a year if you've completed two years of study and the remainder of your program is at least a full academic year.

If you're an independent undergraduate student or a dependent student whose parents are unable to get a PLUS Loan (a parent loan), you can borrow up to

• $6,625 if you're a first-year student enrolled in a program of study that is at least a full academic year. (At least $4,000 of this amount must be in unsubsidized loans.)
  
  
• $7,500 if you've completed your first year of study and the remainder of your program is at least a full academic year. (At least $4,000 of this amount must be in unsubsidized loans.)
  
  
• $10,500 a year if you've completed two years of study and the remainder of your program is at least a full academic year. (At least $5,000 of this amount must be in unsubsidized loans.)

The amounts given here are the maximum yearly amounts you can borrow in both subsidized and unsubsidized Stafford Loans, individually or in combination. Because you can't borrow more than your cost of attendance minus the amount of any Pell Grant you're eligible for and any other financial aid you'll get, you may receive less than the annual maximum amounts.

What's the interest rate on these loans?

The interest rate is variable, but it will never exceed 8.25%. From July 1, 1996 through June 30, 1997, the interest rate is 8.25%. It's adjusted each year of repayment, and you'll be notified of rate changes throughout the life of your loan.

When do I pay back these loans?

After you graduate, leave school, or drop below half-time enrollment, you have six months before you begin repayment. This is called a grace period. During your grace period, you'll receive information about repayment and will be notified of the date repayment begins. However, you're responsible for beginning repayment on time, even if you don't receive this information. Payments are usually due monthly.

Back to Part 1 of Federal and Direct Stafford Loans

Campus-Based Aid Programs | PLUS Loans (Loans for Parents)