Federal Stafford Loan

What is a Federal Stafford Loan?
A federal loan awarded to all students who apply for financial aid and who are U.S. Citizens or permanent residents. The student must be enrolled at least half-time to be eligible for the Federal Stafford Loan.

If you have a Federal Subsidized Stafford Loan, the federal government will pay the interest on your loan while you are in school and during your grace period, 6 months after you graduate or cease to be enrolled half-time.

If you have a Federal Unsubsidized Stafford Loan, you are responsible for paying the interest while in school, but can defer interest payments until after your graduate or cease to be enrolled half-time.

How much am I eligible to receive in Federal Stafford Loans?
Based on your grade level, dependent students can borrow $3,500 as a freshman (0-29 units), $4,500 as a sophomore (30 to 59 units) and $5,500 for junior and senior years (60 units or more). These loan limits are effective through the 2007-2008 academic year.

What is the interest rate?
The Federal Stafford Loan interest rate is a fixed rate of 6.8 percent.  This fixed interest rate is applicable while in-school, during grace periods, during periods of deferment or forbearance and during repayment. 

How will the loan funds be sent to the LMU?
Provided that you have completed the online Loan Entrance Counseling session and the Master Promissory Note (MPN), the loan will be sent in two disbursements; First disbursement in the fall semester and the second disbursement in the spring. These funds arrive via Electronic Fund Transfer (EFT) and are applied directly to your LMU student account.

When do I pay the loan back?
Repayment on this loan will begin after your grace period, 6 months after you graduate or cease to be enrolled at least half-time. You have 10 years to pay the loan back. Various repayment options are available and the loan period can be extended, if needed via consolidation. There is no prepayment penalty, so you can pay the loan earlier if you wish.

How to Apply for the Federal Stafford Loan