Stafford Loans for Undergraduate Students

On March 30, 2010, the Health Care and Education Reconciliation Act was signed into law. A component of this Act is the elimination of the Federal Family Education Loan Program (FFELP) that allowed banks and private lenders to provide federal loans. Beginning on July 1, 2010, all federal student loans will be funded through the government's Federal Direct Loan Program. Based on these changes, Graduate Leverage will no longer offer Stafford Loans. Please visit the U.S. Department of Education's website for more information on the Direct Loan Program and Undergraduate Stafford Loans.

Here is some important information about Federal Stafford Loans that might be helpful as you plan to pay for school:

What is a Stafford Loan?

The Stafford Loan is usually the best option for students requiring additional funding for school once grants, scholarships and other free aid is awarded. Stafford Loans are low-cost federal loans which are available to undergraduate students at a fixed interest rate. Stafford Loan funds are disbursed directly to the school.

Undergraduate students should complete the Free Application for Federal Student Aid (FAFSA) before applying for the Federal Stafford Loan. The FAFSA will determine a student's qualification for free aid.

Subsidized Stafford Loans: The government pays the accrued interest on the loan while the student is still in school (at least half-time status), during the grace period and throughout approved deferment periods. Repayment will begin 6 months after the student graduates or is enrolled in school less than half-time. Eligibility for the Subsidized Stafford loan is based on financial need and there are annual borrowing limits determined by a student's grade level.
Unsubsidized Stafford Loans: The student is responsible for the accrued interest on the loan from the loan's first disbursement date. Repayment will begin 6 months after the student graduates or is enrolled in school less than half-time. Financial need or income levels are not factors for eligibility.

Loan Terms: