Federal Direct Lending Program
What You Need to Know
The Federal government guarantees students' access to low-interest student loans to help meet the costs of higher education. In order to qualify for Federal Direct Stafford Loans, students must file a FAFSA annually. The Federal Direct Parent Plus Loan is also available for parents of dependent students. It is recommended that students determine their eligibility for all Federal Title IV student aid before utilizing private education loan options, as the terms and conditions of the federal programs may be more favorable. All federal student and parent loans are submitted to the National Student Loan Data System (www.NSLDS.ed.gov), and will be accessible by the student, as well as guaranty agencies, lenders, and schools who are authorized users of the data system.
Interst rates for Stafford and Plus loans for the 2013-14 academic year are:
- 3.86% for Stafford Subsidized Loan (need-based, does not accrue interest while the student is enrolled in college)
- 3.86% for Stafford Unsubsidized Loan (not need-based, accrues interest even while the student is enrolled in college)
- 6.4% for Parent Plus Loan
Loan Application Procedures
- To apply for the Stafford Loan:
Stafford Student Loans are guaranteed to all students who complete a FAFSA, so there is no approval process. If you choose to take Stafford student loans, you must first sign a Master Promissory Note (MPN) AND complete Loan Entrance Counseling online at studentloans.gov. The student must sign in with their own FAFSA PIN.
Yearly Stafford Student Loan Limits are as follows: