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DIRECT STAFFORD LOANS

Federal Stafford loans are the most commonly borrowed student loans. Federal Stafford loans are long-term loans with no payment required while the student is in school or during their six-month grace period. All Federal Stafford Loans are now processed through the Department of Education.

Types of Stafford Loans

Subsidized Stafford Loan – is based on need. Need is established by the schools cost of attendance. The U.S. Department of Education pays the interest while the student is enrolled at least half time. Upon graduation or upon the student course load dropping below half-time, the student will receive a six-month grace period before entering repayment on their subsidized loan.

Unsubsidized Stafford Loan – is not based on need, however is also used to assist in meeting educational costs of the student. The student is responsible for the interest payments from the time of loan disbursement until the loan is paid in full. Students borrowing unsubsidized loans will have the option to pay the interest as they attend school or let the interest accumulate and be added to the principle of the loan. Be advised that if the student chooses the latter option of letting the interest accumulate, it will be capitalized and the total amount repaid will be higher than if the interest is paid as they go.

Accepting a Direct Stafford Loan

To accept a Stafford loan the student must:

·         Complete Entrance Counseling and a Master Promissory Note (MPN) at https://studentloans.gov. The student will need you Department of Education issued FAFSA PIN # in order to log in to this web site. If you do not remember your pin, you can request a duplicate pin by going to www.pin.ed.gov to have your PIN shown to you there or sent to you via e-mail or snail mail.

·         Complete theloan award acceptance form and submit it to The Office of Student Financial Aid at UTPB. This form is also available in the financial aid office.

 

**Students and parents of students: Please be aware that if you accept a Direct student loan or a Parent Plus loan that the loan information will be submitted to the National Student Loan Data System (NSLDS), and will be accessible by guaranty agencies, lenders, and institutions determined to be authorized users of the data system.

ANNUAL STAFFORD LOAN LIMITS: In general, your grade level in your current program of study and your dependency status determines the maximum amount(s) you can borrow in an academic year (not to exceed the cost of attendance). Your dependency status is determined by information provided on your FAFSA. Your grade level in your program of study is determined according to the following scale (effective July 1, 2008):

Undergraduate Year In School

No. of Hours Transferred or Earned in Current Program

Dependent Maximums- 
Subsidized Unsubsidized

Independent Maximums*
Subsidized    Unsubsidized

First Year

0-29

$3,500          $2,000    

$3,500            $6,000

Second Year

30-59

$4,500          $2,000

$4,500            $6,000

Third Year

60-89

$5,500          $2,000

$5,500            $7,000

Fourth &  
Fifth Year

90+

$5,500          $2,000

$5,500            $7,000

Graduate 
Students

N/A

N/A

$8,500            $12,000

                                                                                   
Independent students can borrow the maximum in both subsidized and unsubsidized money. For example, an independent second year student can borrow up to $10,500. (If the student's cost of attendance is not exceeded).

LIFETIME LOAN LIMITS: Lifetime limits change as your level of curriculum study changes or your dependentcy status changes. The lifetime loan limits are as follows (effective July 1, 2008):

Undergraduate dependent lifetime limit

Undergraduate independent lifetime limit

 Graduate or Professional lifetime limit

$31,000 (up to $23,000 may be subsidized)

$57,500 (between subsidized and unsubsidized)

$138,500 (up to $65,000 may be subsidized) or $224,000 (for health professions)