Stafford loans for education

The last post I wrote about one of the ways that you can receive federal money to further your education through grants. Another possible financial solution is to apply for Federal loans. One of the most popular is the Stafford loan.

 

The Stafford loan is a low interest loan made available by the government for 4 year college courses, graduate studies, and trade, career or technical schools. The money comes directly from the Department of Education.

 

There are 2 types of Direct Stafford Loans.

1. Direct Subsidized loans are for students that show financial needs. Your school will determine how much money you will receive.  
2. Direct Unsubsidized loans are for anyone regardless of financial needs. Your school determines how much money you will receive. You can pay the interest off as it accrues or wait till you are out of school.

You can apply for a Stafford loan by completing the Free Application for Federal Student Aid (FAFSA). You must also sign a Master Promissory Note (MPN) that says that you will repay the loan and the interest. This too can be found on line.


There is a loan fee applied that is 1%. The direct loan program has various payment schedules between 10 and 25 years to pay off loans. If you are having problems repaying the loan go to the repayment loans website.




   
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