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Federal Stafford Loans
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 NC Advantage (Borrower
Benefits)
See how much and how you save with our loans. |
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Stafford Loans are low-interest loans made to students.
The interest rate for Federal Stafford Loans made on or after
July 1, 2006 is fixed for the life of the loan and is set based upon
the date the loan is made (details below). See how much you can
lower your rate at repayment with our NC Advantage!
The Federal Stafford Loan is the most widely used loan in the
student education loan program because of its low interest rate and
wide availability. Repayment terms are up to 10 years.
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| A Subsidized
Stafford Loan is available to students who have financial need. An
Unsubsidized Stafford Loan is an option for students who do not
demonstrate financial need. |
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Subsidized Stafford Loan
For the student with financial need, the federal government pays the
interest on the subsidized loan while the borrower is enrolled in
college at least half-time and for six months after enrollment
stops. At the end of the six-month grace period, the borrower
becomes responsible for the loan interest and repayment.
The table below shows the fixed interest rate on Subsidized
Stafford Loans set by federal statute and based on the date the loan
is made through 2012.
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The amount of
Federal Stafford loan students may borrow depends on their grade
level in school, program length, amount of other financial aid
received, dependency status, and -- in the case of the subsidized
Stafford Loan -- the amount of financial need.
Loan Limits
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| Date
Made |
Fixed
Interest Rate |
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Undergraduate
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Graduate |
| July
1, 2006 - June 30, 2008 |
6.8% |
6.8% |
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| July
1, 2008 - June 30, 2009 |
6.0% |
6.8% |
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| July
1, 2009 - June 30, 2010 |
5.6% |
6.8% |
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| July
1, 2010 - June 30, 2011 |
4.5% |
6.8% |
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| July
1, 2011 - June 30, 2012 |
3.4% |
6.8% |
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| July 1, 2012 |
6.8% |
6.8% |
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Unsubsidized Stafford Loan
Student borrowers with no financial need are eligible for
Unsubsidized Stafford Loans. Interest on these loans is not paid by
the federal government and is the responsibility of the student at
all times. Borrowers can either pay the interest while they are
enrolled or have it added to the loan principal. Delaying the
interest payment by adding to principal, however, will increase the
cost of the loan. Repayment of the principal begins six months after
the student is no longer enrolled.
The fixed interest rate is 6.8% for Unsubsidized
Stafford Loans made on or after July 1, 2006.
Loan Limits
To borrow a Stafford Loan from College Foundation, Inc.
(CFI), the prospective borrower must have a North Carolina
Connection as well as meet federal loan requirements. The required
connection is established by meeting at least one of the following:
You are:
- A resident of North Carolina; or
- Enrolled, or accepted for enrollment, at a North Carolina
college or university eligible to participate in the Federal Family
Education Loan Program; or
- A previous CFI borrower; or
- A current or former participant or beneficiary in the
North Carolina 529 college savings plan; provided that, the savings
account was active on or before June 1, 2008 and not closed due to
a rollover to another qualified tuition program.
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How do new borrowers apply for a Stafford Loan?
The first step is to complete the Free Application for Federal
Student Aid (FASFA) and have your results sent to the financial aid
offices of the schools to which you are applying. Each financial aid
office then determines if you are eligible for a subsidized or
unsubsidized Stafford loan and, if so, includes this recommendation
and loan amount in your financial aid award package. |
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| Once you make your
school choice and accept its financial aid offer, the school can
certify you as eligible for a Stafford Loan. You must then complete
a loan application (the Master Promissory Note) with a lender in
order to get your loan.
Many schools provide you with a list of lenders to consider;
you may select one from the list or any other lender you prefer.
Once you choose a lender, follow the directions from your school on
how to complete the loan process. Please note: some colleges
participate only in the Federal Direct Loan Program which might mean
you do not have a choice of lender. Ask your financial aid office to
clarify their financial aid process.
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| If you do have a
choice of the lender for your Stafford Loan, be sure you ask
questions before you decide. For example: |
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Does the lender offer
borrower benefits to save you money on your loan?
Does your lender sell its
loans or provide service throughout the life of your loan?
Other
questions to ask. |
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Nondiscriminatory Policy
All student financial assistance is awarded on a nondiscriminatory
basis without regard to race, color, religion, national origin, sex,
marital status, disability, sexual orientation, veteran status, age
(with the exception that borrowers must be at least 17 to enter into
loan contracts under North Carolina law), or any other protected
characteristics established by law.
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