Get A Stafford Loan The Easy Way To Go To College

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A Stafford loan is easy to apply for if you want to go to college.

As mentioned elsewhere in this website, there are college scholarships like tennis scholarships and other sports scholarships that you can avail of. Unfortunately, just a relatively few qualify for those kind of scholarships.

The rest have to find a way to find the necessary cash to finance their college education whose costs outpace the rate of inflation year after year. There are ways, though, for the majority of students to get college loans. In fact, 75% of students get some kinds of student loans for college - from the private sector and financial aid guaranteed by the federal government.

If you are a federal student loan borrower who wish to consolidate your college loan, try STUDENT LOAN CONSOLIDATION - you can save money and can cut your minimum monthly payment requirements up to 60%.

Federal aid packages can be supplemented by PLUS STUDENT LOANS which can cover the costs not covered by those aid packages.

In between tennis matches, maybe YOU can spare some moments toward personal enrichment or job promotion by getting an ONLINE COLLEGE DEGREE.

For getting that long-sought promotion, do it faster by getting a BACHELOR DEGREE ONLINE.

Instead of STAFFORD LOAN , try tennis recruiting if you have a kid who is good in tennis. Here's a question and answer format to help you understand Stafford Loan better...

What is a Federal Stafford Loan?

A Stafford Loan is a low, simple interest, government-guaranteed loan that students can borrow when they are in school and not worry about making payments until six months after they graduate.

If it is administered by the Federal Family Education Loan Program (FFELP), this means that the funds are provided by private lenders, such as savings & loan associations, credit unions, and banks. These loans are guaranteed against default by the federal government. If your school is a "Direct Lending School", your Stafford Loan is administered by the Federal Direct Student Loan Program (FDSLP). Funds for "direct loans" are provided by the US government directly to students through their schools.

All Stafford Loans are either subsidized (the government pays the interest while you're in school) or unsubsidized (you pay all the interest, although you can have the payments deferred until after graduation). To receive a subsidized Stafford Loan, you must be able to demonstrate financial need.

With the unsubsidized Stafford loan, you can defer the payments until after graduation by capitalizing the interest. This adds the interest payments to the loan balance, increasing the size and cost of the loan.

All students, regardless of need, are eligible for the unsubsidized Stafford Loan.

Many students combine subsidized Stafford loans with unsubsidized loans to borrow the maximum amount permitted each year.

To apply for this type of loan, you must submit the Free Application for Federal Student Aid (FAFSA). Even though the unsubsidized Stafford Loan is available to all students regardless of financial need, you must still submit the FASFA to be eligible. You can receive a subsidized loan and an unsubsidized loan for the same period.

How much can I borrow?

The maximum eligibility for borrowers is based on what year in school they are and whether they are dependent or independent. Students can borrow up to the following maximum amounts:

Year Dependent Independent

Freshman $ 2,625 $ 6,625
Sophomore $ 3,500 $ 7,500
Junior $ 5,500 $ 10,500
Senior $ 5,500 $ 10,500
5th Year $ 5,500 $ 10,500
Graduate $ n/a $ 18,500
Medical $ n/a $ 38,500

What is a subsidized loan?

The U.S. Department of Education pays the interest on subsidized loans while the student is enrolled in school, during the six month grace period after school, and during authorized deferment periods. Unsubsidized loans always accrue interest.

Who can get a Stafford Loan? If you’re a regular student enrolled in an eligible program at least half time, you may receive a Direct or FFEL Stafford Loan. You must also meet other general eligibility requirements.

Is there any credit check?

There is no credit check on potential customers on this loan.

How will I receive my Stafford Loan?

Your school will disburse your loan in at least two installments; no installment will be greater than half the amount of your loan.

Your loan money must first be used to pay for your tuition, fees, and room and board. If loan funds remain, you’ll receive them by check or in cash, unless you give the school written permission to hold the funds until later in the enrollment period.

If you’re a first-year undergraduate student and a first-time borrower, your first disbursement can’t be made until 30 days after the first day of your enrollment period. That way, you won’t have to repay the loan if you withdraw during the first 30 days of classes. (However, you might owe money to the school for a portion of tuition or other fees.)

Can I cancel the loan if I change my mind, even if I’ve signed the promissory note agreeing to the loan’s terms?

Yes. Your school must notify you in writing whenever it credits your account with your Loan funds. You may cancel all or a portion of your loan if you inform your school within 14 days after the date your school sends you this notice, or by the first day of the payment period, whichever is later. (Your school can tell you the first day of your payment period.) If you receive Stafford Loan funds directly by check, you may refuse the funds by returning the check.

What’s the interest rate on these loans?

The interest rate is variable (might change each year) but does not exceed 8.25 percent. For July 1, 2003 to June 30, 2004, the interest rate for loans in repayment was 3.42 percent. Interest rates are adjusted each year on July 1. You’ll be notified of interest 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 a six-month grace period before you begin repayment. During the grace period on a subsidized loan, you don’t have to pay any principal, and you won’t be charged interest. During the grace period on an unsubsidized loan, you don’t have to pay any principal, but you will be charged interest. You can either pay the interest or it will be capitalized.

Your lender will send you information about repayment, and you’ll be notified of the date repayment begins. However, you’re responsible for beginning repayment on time, even if you don’t receive this information. Failing to make payments on your loan can lead to default.

How do I pay back my Stafford Loans?

You’ll repay your FFEL Stafford Loan to a private lender or loan servicer. Direct Loan borrowers can view and pay their bills online, using their PIN, through the Servicing Center Web site:

Both the Direct Loan and FFEL programs offer four repayment plans you can choose from, but the terms differ slightly. You’ll receive more detailed information on your repayment options during entrance and exit counseling sessions.

Are there any tax incentives available for paying back these loans?

Yes, there are tax incentives for certain higher education expenses, including a deduction for student loan interest for certain borrowers. This benefit applies to all loans taken out to pay for postsecondary education costs. The maximum deduction is $2,500 a year. IRS Publication 970, Tax Benefits for Higher Education, explains these credits and other tax benefits. You can find out more at or by calling the IRS at 1-800-829-1040. TTY callers can call 1-800-829-4059.

Is it ever possible to postpone repayment of my loan?

Yes, under certain conditions, you can receive a “deferment” or “forbearance” on your loan, as long as the loan isn’t in default. A deferment allows you to temporarily postpone payments on your loan. If you have a subsidized loan, you won’t be charged interest during the deferment. If your loan is unsubsidized, you’ll be responsible for the interest. You can pay the interest as it accrues (accumulates), or it will be capitalized and the amount you’ll have to repay will increase.

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