Direct Subsidized and Unsubsidized Stafford Loan
The Federal Direct Stafford Loan program provides these low interest loans. The lender for the Stafford Loan Programs is now the U.S. Department of Education?not a bank or financial institution.
- Direct Subsidized Stafford: If you will be borrowing a Stafford Loan, you should borrow through this program first. The Federal government pays the interest while the student is enrolled in school at least half-time and also during a six month grace period which begins when a student graduates or drops to less than half-time. This loan is need based.
- Direct Unsubsidized Stafford: This loan is not need-based. Interest accrues while the student is enrolled in school and during the grace period (also six months). Students may pay interest while enrolled or capitalize the interest which has accrued at repayment. Half-time enrollment is also required for this loan.
- Loan entrance and exit counseling is required.
Stafford Loans have a fixed interest rate for the life of the loan. The interest rate for Subsidized Stafford Loans first disbursed on or after July 1, 2012 is currently 6.8%. The current interest rate for Unsubsidized Stafford loans is 6.8%
Maximum Annual Loan Limits
|Annual Loan Limits for Dependent Students|
|First Year||$5,500. No more than $3,500 of this amount may be subsidized|
|Second Year||$6,500. No more than $4,500 of this amount may be subsidized|
|Third and Fourth Years||$7,500. No more than $5,500 of this amount may be subsidized|
|Cumulative Maximum||$31,000. No more than $23,000 of this amount may be subsidized|
|Annual Loan Limits for Independent Students|
|First Year||$9,500. No more than $3,500 of this amount may be subsidized|
|Second Year||$10,500. No more than $4,500 of this amount may be subsidized|
|Third and Fourth Years||$12,500. No more than $5,500 of this amount may be subsidized|
|Cumulative Maximum||$57,500. No more than $23,000 of this amount may be subsidized|
How to apply for a Federal Stafford Loan
- Apply for financial aid if you have not already done so.
- For 11-12 return your signed financial aid award letter to the Crown College Financial Aid Office.
- For 12-13 go to the Federal Direct Stafford Loan Request Form Page. Download the form and fill it out, saving a copy as a file on your computer. Then follow the instructions to submit it online.
- Complete an online Direct Loan Master Promissory Note (MPN). The Master Promissory Note is a written contract between the borrower and the lender. You will need your Department of Education PIN to log in and sign your MPN. If you do not have a PIN or have lost your PIN you may obtain one by visiting www.pin.ed.gov.
- First time Stafford Loan borrows must complete on-line Direct Loan Entrance Counseling for Subsidized/Unsubsidized Federal Direct Stafford Loans.
The fee for Direct Subsidized and Unsubsidized Loans is 1.0%. Loan funds (less the fees) are disbursed directly to the student?s Crown College account and they are evenly split between the terms of enrollment.
Direct Loan Information
For additional information including repayment plans and calculators please visit the U.S. Department of Education?s Direct Loan website at www.direct.ed.gov/student.html.