Federal Direct Stafford Loans
The Federal Direct Stafford Loan Program offers both Federal Direct Stafford Subsidized and Unsubsidized Loans to help you finance your college education. These loans must be repaid. They have a 1% origination fee.
Federal Direct Stafford Loan funds are disbursed directly to Hawkeye to be applied to your student account.
If you withdraw from classes and are enrolled less than part-time or when you graduate you will need to complete Exit Loan Counseling. If you withdraw from classes after your loan has been disbursed, you may need to return your unearned aid. Learn more about how withdrawing from classes can affect your Financial Aid Award.
If you are transferring from another college or university during the academic year, it is your responsibility to notify our office if you received aid at your previous college or university. Per federal regulations, you are allowed to only borrow the annual loan limit during the academic year.
View a list of Loan Servicing Centers for Students.
Subsidized Federal Direct Stafford Loan
A subsidized loan is awarded on the basis of financial need. If you are awarded a subsidized Federal Direct Stafford Loan you will not be charged interest on the loan while you are enrolled in school at least half-time, during your six month grace period, and during deferments.
Once you go into repayment your loan will begin accumulating interest. The current interest rate is fixed at 3.4%. Effective July 1, 2012 the interest rate will be 6.8% and the loan fee will be 1%.
Unsubsidized Federal Direct Stafford Loan
If you are awarded an unsubsidized Federal Direct Stafford Loan you will be charged interest on the loan from the time the loan is disbursed until it is paid in full. You can pay the accumulating interest while in school and during the grace period, or allow the interest to accumulate. The current interest rate is fixed at 6.8%. Effective July 1, 2012 the interest rate will be 6.8% and the loan fee will be 1%.
If you pay the interest as it accumulates, you will pay less during the loan repayment period.
If you choose to have the interest accumulate while you are in school, the interest will be added to the principal amount of the loan and will increase the amount to be paid once you go into repayment.
An unsubsidized loan is not awarded on the basis of need.
How much can I borrow?
First-year students can borrow up to $5500.
Second-year students can borrow up to $6500.
If your parents are unable to qualify for a Federal Direct Stafford Parent PLUS Loan, you can borrow up to an additional $4,000 in unsubsidized loan.
The total debt you can have outstanding from all Federal Direct Stafford Loans is $31,000 as a dependent undergraduate student or $57,500 as an independent undergraduate student. No more than $23,000 of this amount may be in subsidized loans.
You are encouraged to borrow only what you need. Failure to repay any federal loan may result in:
- poor credit rating
- garnishment of Federal Tax Refunds
- inability to get future consumer loans
Receiving Your Federal Direct Stafford Loans
If you are awarded subsidized or unsubsidized Federal Direct Stafford Loans, you will need to complete the following loan requirements:
- Accept or Reject the Loan(s)
- Compete the Master Promissory Note
- Complete the Loan Entrance Counseling
- Complete the Student Loan Game Plan
Disbursement of your financial aid.
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