What kind of federal loans are available for college?

The chief federal loan program is the Stafford loan.
A Stafford loan is a federal loan program that allows students
to borrow to pay for college.

Loans are made by either a private lender or directly from the
federal government. For students with high financial need,
the government pays interest on at least a portion of that
while you’re in school.

Anyone (regardless of family income) can take out an unsubsidized
Stafford, which still lets you defer payments until after graduation.

Depending on your school, you may be offered a Stafford directly
from the government. Or you may take out a government-guaranteed
Stafford loan that’s provided by private lenders such as banks.

If eligible, a student can receive a subsidized loan, which means
that the government pays interest on the loan until the grace period
ends.

Unsubsidized loans are available to all students, who can elect
to pay interest before or after the loan repayment period begins.
Interest rates are set on July 1.

All students applying for a federal student loan are required
to complete a FAFSA loan application.

If you have high need, you may also be offered a Perkins loan.
A Perkins loan is a federal student loan program to pay for college.
Perkins loans are subsidized loans, which means the government
pays the interest until the end of the loan grace period.

The annual interest rate on Perkins loans is capped at 5%.
All students applying for a federal student loan are required
to complete a FAFSA loan application.

The grace period for Perkins loans is nine months.
The borrowing limits are $4,000 per year for undergraduates.

This entry was posted on Saturday, May 19th, 2007 at 10:45 pm and is filed under Student Loans, Financial Aid. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.