Undergraduate and graduate students in the US can take the benefit of loan to help cover the cost of education and this loan is called Stafford loan. But there are eligibility criteria for this:

• The student must be US citizen
• She/he must be a permanent resident or a suitable non-citizen

Stafford loan is not given based on credit history or income. It has a fixed rate of interests and further known as subsidized and unsubsidized Stafford loan. All students who have taken this loan will get six months grace period to search for a job and repay the loan.

Subsidized Stafford Loan

A subsidized Stafford loan is a loan for which the interest is paid by the federal government until:

• During the period when you are in school
• During the grace period
• During any rescheduling period

With this loan, you can relax and concentrate on your studies without the tension of paying the interest. It is available for undergraduate students with financial need and the school decides how much loan you can take. The loan amount will not be more than the need.

Unsubsidized Stafford Loan

An unsubsidized Stafford loan is a loan in which you are responsible to pay the interest from the first date of loan amount disbursed. Based on the cost of attendance and other financial aid, your school will decide the amount of loan to be given.

This is available for both graduates and undergraduates. If you are unable to pay the interest, then it will be accumulated with your principal amount of loan.

How Many Loans Can You Take?

Subsidized and unsubsidized Stafford loan amount disbursal depends on what you are eligible for in each academic year. This is decided by the school. But the actual loan amount you are qualified to receive each year is always less than the annual loan limit.

First-year graduates are eligible to get a loan up to $5,500, which increases every year. The interest rate depends on which year the Stafford loan is taken.

How to Apply?

You need to fill and submit the FAFSA (Free Application for Federal Student Aid) form and based on the information given on this form, the school will decide how much loan to be processed.

Current Rate of Interest:

• For undergraduate – subsidized and unsubsidized Stafford loan: 4.53%
• For graduate and professional – unsubsidized Stafford loan – 6.08%