Federal Direct Stafford Loans

Direct Stafford Loans, from the William D. Ford Federal Direct Loan (Direct Loan) Program, are low-interest loans for eligible students to help cover the cost of higher education at a four-year college or university, community college, or trade, career, or technical school. Eligible students borrow directly from the U.S. Department of Education (the Department) at participating schools.

 

v  You must be enrolled as at least a half-time student to be eligible for a loan. Direct Loans include the following:

 Direct Loans

o   Direct Subsidized Loan- Direct Subsidized Loans are for undergraduate students only effective July 1, 2012 with financial need. You are not charged interest while you’re in school at least half-time and during grace periods and deferment periods. After you graduate, leave school, or drop below half-time enrollment, you have a period of time before you have to begin repayment. This "grace period" will be Six months for a Federal Stafford Loan (Direct Loan Program or Federal Family Education Loan (FFELSM) Program).

 

o   Direct Unsubsidized Loan-  The Direct Unsubsidized loans are for graduate and undergraduate students. You are not required to demonstrate financial need to receive a Direct Unsubsidized Loan. Interest accrues (accumulates) on an unsubsidized loan from the time it’s first paid out. You can pay the interest while you are in school and during grace periods and deferment or forbearance periods, or you can allow it to accrue and be capitalized (that is, added to the principal amount of your loan). If you choose not to pay the interest as it accrues, this will increase the total amount you have to repay because you will be charged interest on a higher principal amount. After you graduate, leave school, or drop below half-time enrollment, you have a period of time before you have to begin repayment. This "grace period" will be Six months for a Federal Stafford Loan (Direct Loan Program or Federal Family Education Loan (FFELSM) Program).