Direct Stafford Loans

A Stafford Loan is a low-interest loan available to students enrolled in a minimum of 6 credits per semester. These loans are made and guaranteed by the federal government. Depending on the student’s need, as calculated by the U.S. Department of Education, these loans are either made on a subsidized basis (the federal government pays the interest during the enrollment period) or on an unsubsidized basis (the student pays the interest).

To determine your loan eligibility, we will assume the same enrollment status (full-time, 3/4 time, 1/2 time) for both the fall and spring semesters based upon the anticipated enrollment information you provided on your FAFSA.

WHAT IS THE DIFFERENCE BETWEEN A DIRECT SUBSIDIZED AND A DIRECT UNSUBSIDIZED STAFFORD LOAN?

The Federal Government pays the interest for Direct Subsidized Loans while the student is in college or while the loan is in deferment. Interest begins accruing for Direct Unsubsidized Loans as soon as the loan is taken out.

 ANNUAL LOAN LIMITS

DEPENDENT STUDENTS*

SUBSIDIZED

UNSUBSIDIZED

TOTAL

Freshmen (0 – 29 credits)

$3,500

$2,000

$5,500

Sophomore (30 – 59 credits)

$4,500

$2,000

$6,500

Junior/Senior (60 and above)

$5,500

$2,000

$7,500

       

INDEPENDENT STUDENTS

SUBSIDIZED

UNSUBSIDIZED

TOTAL

Freshmen (0 – 29 credits)

$3,500

$6,000

$9,500

Sophomore (30 – 59 credits)

$4,500

$6,000

$10,500

Junior/Senior (60 and above)

$5,500

$7,000

$12,500

Graduate Certificate

$5,500

$7,000

$12,500

Graduate/Professional

$8,500

$12,000

$20,500

 

*NOTE: For dependent students whose parents cannot borrow under PLUS program, the amount a student can borrow under the Stafford program is the same as an independent student.

AGGREGATE LOAN LIMITS

  • Dependent Undergraduate: $31,000 (no more than $23,000 in subsidized)
  • Independent Undergraduate: $57,500 (no more than $23,000 in subsidized)
  • Graduate/Professional: $138,000 (no more than $46,000 in subsidized)

HOW MUCH CAN I BORROW?

For subsidized loans, the maximum is $3,500 for freshmen, $4,500 for sophomores, and $5,500 for juniors and seniors. Undergraduates who are not eligible for Direct Subsidized Loans may borrow an identical amount in a Direct Unsubsidized Loan. Undergraduates may also borrow an additional $2,000 in a Direct Unsubsidized Loan after they have exhausted their initial subsidized/unsubsidized eligibility. Graduate students may borrow a Direct Unsubsidized Loan for up to $20,500.

Undergraduates may not borrow subsidized loans in excess of their financial need (the difference between the cost of attending Caldwell and our estimate of your contribution to you or your child’s education). No student may borrow unsubsidized loans in excess of his/her cost of attendance.

WHAT ARE THE INTEREST RATES?

2013-2014 Direct Loan Interest Rates and Fees
(for loans with a first disbursement date on or after July 1, 2013)

DIRECT LOAN PROGRAM

INTEREST RATE

Origination FEE*

INTEREST CAP

Subsidized and Unsubsidized  Federal Direct Loan (for Undergraduates only)

3.86%

1.051%

8.25%

Unsubsidized Federal Direct Loan (for Graduates only)

5.41%

1.051%

9.5%

WHEN ARE PAYMENTS DUE?

Repayment begins six months after leaving college, payments are made monthly, and you have ten years to repay the loan; however students may apply for a consolidation or an extended repayment plan.

RIGHTS AND RESPONSIBILITIES OF A STUDENT LOAN BORROWER

In accordance with federal regulations, first-time Stafford loan borrowers must complete entrance counseling on the web at https://studentloans.gov/myDirectLoan/index.action. No loans can be credited to a student’s account until entrance counseling is complete.

Students who are recipients of a federal Stafford loan who drop below six (6) credits or graduate must complete an exit counseling session at http://mappingyourfuture.org/oslc/counseling/index.cfm?act=Intro&OslcTypeID=2.

FEDERAL STAFFORD LOAN MASTER PROMISSORY NOTE (MPN)

The Federal Stafford Loan Master Promissory Note (MPN) is a promissory note under which you may receive multiple subsidized and unsubsidized Federal Stafford Loans over a maximum ten-year period.

  • If you complete a Federal Stafford Loan (MPN) as a freshman or during your first semester at Caldwell, you will NOT have to complete another application for 10 years, or until you enter another College.
  • You will receive a Loan Guaranty Summary from your guarantee agency. Your lender will provide you with a Loan Disclosure Statement.
  • If you are a first-time borrower at Caldwell College, your first disbursement of loan proceeds cannot be made until 30 days after the first day of your enrollment period or start of classes
  • Your loan will be disbursed according to a schedule established by Caldwell College and Federal guidelines. It will be made in two or more installments and transferred electronically to your college account.
  • Please remember that a Federal Stafford Loan is a loan, not a grant. You must repay the funds you borrow, plus interest and fees. If you have any questions, do not hesitate to contact the Office of Financial Aid at 973-618-3221 or at FinancialAid@Caldwell.edu .

To decline or accept a lesser amount please notify us at FinancialAid@Caldwell.edu.

A two step process must be completed in order to receive the Stafford Student Loans. Please click below to start the “Entrance Counseling” and Complete a MPN” application process:

studentloansgov


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