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Tips and Information on Federal Student Loans, Including Perkins and Stafford Loans
INFORMATIVE 
Tags: Stafford, Perkins, loans, college, tuition, federal, student, loans, tuition, assistance, free, government, resources
Many institutions, both public and private, provide low-interest loans to students and their parents or guardians. The Federal Government also provides several types of student loans based on the applicant’s level of financial need. Here is a quick list of things to consider:
| | The amount of money a student can receive in loans varies by the distributing institution and depends on whether the student is claimed by a parent or guardian as a dependent. |
| | Since the process of applying for a loan may take several months, it is a good idea to start applying for Federal student loans well in advance. |
| | The available Federal loan programs can accommodate prospective undergraduate, graduate, vocational, and disabled students. |
| | Federal loans can be distributed through the school that the student is attending, from the Federal Government directly, or from a third-party private lender or bank. |
| | Perkins loans are distributed through the school the student is attending. |
| | Loans coming from the Federal Government directly from the William D. Ford Federal Direct Loan Program are dispersed by the Department of Education. |
| | Third-party loans through a private lender or bank are from the Federal Family Education Loan (FFEL) program. |
| | For all federally funded loans, payments are made to the institution that originally dispersed the funds. |
| | For those with financial need, Federal Perkins loans and both Direct and FFEL-subsidized Stafford loans are available. |
| | Perkins loans have no minimum amount, but they are capped at $4,000 per year for undergraduates and $6,000 per year for graduate students. |
| | Interest rates remain at a flat 5 percent for all Perkins loans. |
| | Those with Perkins loans are not responsible for starting to repay the loan until they have been out of school for 9 months. |
| | Typically, students have 10 years to repay Perkins loans. |
| | Subsidized Stafford loans can range in value from $2,625 to $8,500 per year and can increase as a student completes more years of undergraduate, graduate, or professional education. |
| | Interest rates can fluctuate up to 8.25 percent for subsidized Stafford loans. |
| | Typically, students range from 10 to 30 years for repayment. |
| | Those with subsidized Stafford loans must begin payments within 6 to 9 months of leaving school but are not charged monthly interest while in school. |
| | Subsidized and unsubsidized Stafford loans are only available to students who are enrolled in an academic program at least half time. |
| | For those who do not demonstrate financial need, Direct and FFEL-unsubsidized Stafford Loans and Federal Parent Loans for Students (PLUS) are available. |
| | Unsubsidized Stafford loans can range in value from $2,625 to $18,500 per year. PLUS loans are capped at the cost of attendance. |
| | With Federal unsubsidized Stafford Loans, interest payments start almost immediately and can be paid monthly or accrued until the completion of studies. |
| | The latter option results in a larger total loan cost but may be more convenient for some students. |
| | With PLUS loans, the parent must pay interest and principal payments while the student is enrolled in school and must continue payments after completion. |
| | Check with your lender for available repayment schedules. |
| | As with any loan, be sure to investigate different lenders, and understand what your loan contract requires of you before agreeing to any loan. |
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Source:
U.S. Department of Labor - Bureau of Labor Statistics
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