What is the difference between Stafford Loans and private loans?

Stafford loans require the student to fill out a FAFSA form, private loans do not. Some of the other typical differences are Stafford (Federal) loans are capped by the annual borrowing amount, awarded based on need by student, and have fixed interest rate. However, students may be able to borrow significantly more than through federal loans. In addition, private student loans tend to be variable interest rates and do not provide the student with a grace period after graduation.

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What is the difference between subsidized and unsubsidized student loans?

In Stafford subsidized loans, the government pays the interest while the student is enrolled in school. In Stafford unsubsidized loans, the student is responsible for the interest payments but can defer payment until after graduation.

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What is a Graduate PLUS Loan?

PLUS loans are Parent Loans for Undergraduate Students. However, graduate and professional students are eligible to apply for these loans. The applicant must not have an adverse credit history and repayment begins on the date of the last disbursement of the loan. For more information visit the Federal Student Aid website

What are the eligibility requirements of PLUS Loans?

PLUS applicants must meet the general eligibility requirements for federal student aid. If a parent is borrowing on behalf of a dependent undergraduate student, the student must also meet these general eligibility requirements. The parent should not have an adverse credit history. If the parent’s credit history is poor, he / she can have a co-signor to agree to repay the loan in the event of default. For example, the PLUS applicant and the student must:

• be a United States citizen or Eligible Non-citizen;
• Not be in default on a federal student loan;
• Not owe a refund on a federal student education grant

Who is eligible to receive federal student aid?

To receive federal student aid, you must meet certain requirements. You must:

• Be a United States citizen or eligible non-citizen;
• Have a valid Social Security Number (unless you’re from the Republic of the Marshall Islands, the Federated States of Micronesia, or the Republic of Palau).
• Be registered with Selective Service if you are male and 18 to 25 years of age
• Have a high school diploma or a General Education Development (GED) Certificate or pass an exam approved by the U.S. Department of Education
• Be enrolled or accepted for enrollment as a regular student working toward a degree or certificate in an eligible program at a school that participates in the federal student aid programs
• Not have a drug conviction for an offense that occurred while you were receiving federal student aid (such as grants, loans, or work-study)
• You must not owe a refund on a federal grant or be in default on a federal student loan
• You must demonstrate financial need (except for unsubsidized Stafford Loans)

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What is a Student Aid Report (SAR)?

A Student Aid Report (SAR) is a document you will receive after your FAFSA is processed. Your SAR will list all of the answers you provided on your FAFSA. You should review these answers carefully to make sure they are correct. Your SAR will contain your Expected Family Contribution (EFC), which measures your family’s financial strength and is used to determine your eligibility for federal student aid. Your school will use this number to determine how much financial aid you are eligible to receive based on your school’s cost of attendance. If you did not provide electronic signatures or paper signature pages with your FAFSA, you must sign the paper SAR you will receive and mail it back to the address provided for final processing. Source: FAFSA website
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