Federal Direct Subsidized Stafford Loan

Federal Direct Subsidized Stafford Loan is for students with financial need as determined by a Federal formula.  A loan is “subsidized” because the government pays the interest for you during the following periods:

  • While you are enrolled in school at least half-time.
  • During the six-month grace period after you stop attending school at least half-time.
  • Interest will be charged during your grace period, if your loan is first disbursed July 1, 2012 through June 30, 2014.
  • During period of authorized deferment.

Federal Direct Subsidized Stafford Loans are low-interest loans for students to help pay for the cost of their education after high school. The lender is the U.S. Department of Education rather than a bank or other financial institution. Direct Loans are:

  • Simple - You borrow directly from the federal government and have a single contact-the Direct Loan Servicing Center - for everything related to the repayment of your loans, even if you receive Direct Loans at different schools.
  • Convenient - You'll have online access to your Direct Loan account information 24 hours a day, 7 days a week.
  • Flexible - You can choose from several repayment plans that are designed to meet the needs of almost any borrower, and you can switch repayment plans if your needs change.

In order to be eligible you must be enrolled at least half-time and demonstrate financial need. Loans range up to $3,500 for freshman and $4,500 for sophomores. Lower loan amounts apply if you are attending clock hour programs.

Federal Direct Direct Loans have an origination fee of 1.051% that will be deducted from the loan proceeds before the funds are applied to your student account.

As of July 1, 2013 the interest rate on a Direct Subsidized Stafford Loan is 3.86%.

A Student Loan Request Form is required in addition to the FAFSA, Entrance Counseling and Master Promissory Note.