Federal Direct Stafford Loan

You may be eligible for a subsidized loan (interest does not accrue while you are in school), an unsubsidized loan (interest accrues while you are in school) or a combination of the two.

Stafford loans disbursed during the period of 7/1/09 – 6/30/10 have an origination fee of 1.5% to cover the cost of administering the loan; 0.5% of the loan origination fee is automatically rebated to you at the time the loan is disbursed, in anticipation of on-time repayment. Hence, you will see just 1.0% deducted from the loan at the time it is disbursed.

The interest rate for Stafford loans varies, depending on whether the loan is subsidized or unsubsidized. For subsidized Stafford loans taken by undergraduates, the interest rate for loans taken during the period of 7/1/09- 6/30/10 is fixed at 5.6%. For unsubsidized Stafford loans taken during the same period, the interest rate is fixed at 6.8%.

Repayment on Stafford loans begins six months after you graduate or cease to be enrolled at least half-time. Half-time for undergraduates is 6 - 8 credit hours per term; for graduate and law students, it is 4-8 credit hours per term.

Students who borrow unsubsidized loans are charged interest from the date the loan is disbursed. You may pay the interest or you may allow it to accumulate. Accumulated interest is capitalized (added to the principal amount of your loan). Capitalized interest increases the total amount you have to repay.

Repayment

You will receive notifications from the Direct Loan Servicer about repayment and of the date your loan repayment begins. You are, however, responsible for beginning repayment on time, even if you don’t receive this information. Update your address with the Direct Loan Service Center at 800-848-0979. Their website is www.dlservicer.ed.gov.

Repayment on a Parent PLUS Loan begins 60 days after the last disbursement, usually in March of the fall/spring academic year. Remember, however, that interest begins accruing on the amount of the first disbursement at the time it is credited to your university bill. A parent borrower can choose to defer payments on the PLUS loan until six months after the date their student ceases to be enrolled at least half time (interest will accrue and be capitalized during any deferment).

You are eligible for a deferment (payments are postponed) on Stafford loan payments as long as you are enrolled at least half time or for circumstances that include, but are not limited to, active military duty, Peace Corps, teaching in a designated Department of Education teacher shortage area, etc. You may be charged interest during the deferment. For more information, contact the Direct Loan Service Center at 800-848-0979. If you are temporarily unable to meet your repayment schedule but are not eligible for a deferment, you may be eligible for a forbearance (payments temporarily postponed due to a serious hardship) for a limited and specified time. Please contact the Direct Loan Service Center at 800-848-0979 to find out if you qualify for a forbearance.

PLUS Loan for Students

The Parent PLUS Loan is offered to parents of dependent students. Only parents or step-parents are eligible to apply for the Parent PLUS loan. Grandparents and other relatives are not eligible. To accept all or a portion of the PLUS (Parent) Loan, one parent must complete the Federal Direct Parent PLUS Loan Information (PLSM) form on right hand panel and return it by fax (307-268-2026) or mail to Student Financial Assistance Office.

A credit check is required to determine eligibility for the PLUS (Parent) Loan. If the parent borrower does not pass the credit check, they have two options.

1. Apply for the PLUS loan with an endorser. The endorser must pass a credit check as well and agree to be held responsible for the loan should the parent borrower fail to repay it.
2. Cancel the PLUS loan and offer the student the independent portion of their Stafford loans (please see chart above). You may be eligible to automatically choose this second option without even applying for the PLUS loan. To qualify for this you must have either negative available income on the FAFSA or be able to provide proof of declaring bankruptcy in the last 5 years.

Once the PLUS (Parent) Loan credit check is approved, either go to dlenote.ed.gov and the parent borrower can complete an electronic PLUS loan Master Promissory Note online or request a paper version from our office. Return the signed original to the financial aid office. We cannot accept faxed copies. The PLUS (Parent) Loan proceeds will be credited to your university bill once the promissory note is received. Remember that if excess funds are to be released to the parent and not the student, it will take 3-4 weeks longer for the funds to be sent to you. If funds are to be released to the student please indicate that on the Parent PLUS Loan Information (PLSM) form that can be located on the right hand panel under Parent PLUS Loan Request.

An origination fee of 4 percent is deducted from each loan you borrow to cover the cost of administering the loan; 1.5% of this is automatically rebated at the time of disbursement in anticipation of on-time repayment. The interest rate is a fixed rate of 7.9%. Interest is charged from the date the loan is disbursed. Repayment starts 60 days after the second disbursement of the PLUS loan; however, the parent borrower can choose to defer payments on the PLUS loan until six months after the date their student ceases to be enrolled at least half time (interest will accrue and be capitalized during any deferment).

The yearly limit on a PLUS (Parent) Loan is equal to your cost of attendance minus any other financial aid you receive.

We are a Direct Lending school, meaning that we will only accept PLUS loans from The Department of Education's Direct Loan program, not from banks. Please contact us if you have questions concerning the PLUS loan.