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Financial Aid FAQs - Direct Stafford Loans
What are the current interest rates?
Direct Subsidized Loans:
- Undergraduate students—If the first disbursement of your subsidized loan is between July 1, 2010 and June 30, 2011, the interest rate on your loan is fixed at 4.5%. The interest rate on subsidized loans first disbursed to undergraduate students between July 1, 2011 and June 30, 2012 will be fixed at 3.4%.
- Graduate and professional degree students—The interest rate is fixed at 6.8%.
- Direct Unsubsidized Loans—The interest rate is fixed at 6.8% for all borrowers (undergraduate and graduate).
Other than interest, is there a charge for this loan?
There is a loan fee on all Direct Subsidized and Unsubsidized Loans. The loan fee is a percentage of the amount of each loan you receive. For loans first disbursed between July 1, 2010 and June 30, 2011 the loan fee is 1.0%. We will deduct the loan fee proportionately from each loan disbursement. The specific loan fee that you are charged will be reflected in a disclosure statement that we send to you.
How do I pay back my loans?
When you receive your first Direct Loan, you will be contacted by the servicer for that loan (you repay your loan to the loan servicer). Your loan servicer will provide regular updates on the status of your Direct Loan, and any additional Direct Loans that you receive. If you’re not sure who your loan servicer is, you can look it up on www.nslds.ed.gov.
Repayment Plans
The Direct Loan Program offers several repayment plans that are designed to meet the different needs of individual borrowers. Generally, you’ll have 10 to 25 years to repay your loan, depending on the repayment plan that you choose. You will receive more detailed information on your repayment options during entrance and exit counseling sessions at your school. To learn more about Direct Loan repayment plans, go to the Repayment Information page on this web site.
FAQs - Direct PLUS Loans for Parents
How does a parent get a loan?
For a Direct PLUS Loan, the parent must complete a Direct PLUS Loan Application and Master Promissory Note (MPN). The MPN is a legal document in which the borrower promises to repay the loan and any accrued interest and fees to the Department. It also explains the terms and conditions of the loan. In most cases, one MPN can be used for loans that a parent receives over multiple academic years although a separate Loan Request must be filed for each school year. If the parent previously signed an MPN to receive an FFEL PLUS loan, he or she will need to sign a new MPN for a Direct PLUS Loan.
The school's financial aid office can provide instructions on applying for a PLUS Loan and may offer the option of completing the PLUS application and MPN online at www.studentloans.gov.
How much can a parent borrow?
The annual limit on a PLUS Loan is equal to the student's cost of attendance minus any other financial aid the student receives. For example; if the cost of attendance is $6,000 and the student receives $4,000 in other financial aid, the student's parent can request up to $2,000.
What's the interest rate?
The interest rate is fixed at 7.9%. Interest is charged from the date of the first disbursement until the loan is paid in full.
Prior Federal Loans and Financial Aid History—Students and parents may check the interest rate, servicer information, and other financial aid history at the National Student Loan Data System.
Interest rate cap for military members—If a parent qualifies under the Service Members Civil Relief Act, the interest rate on loans obtained before entering military service may be capped at 6% during the parent's military service. Parents must contact their loan servicer to request this benefit.
In addition, we do not charge interest (for a period of no more than 60 months) on Direct Loans first disbursed on or after October 1, 2008, while a borrower is serving on active duty or performing qualifying National Guard duty during a war or other military operation or other emergency, and serving in an area of hostilities qualifying for special pay.
Other than interest, is there a charge to get a PLUS Loan?
The parent will pay a fee of 4% of the loan amount, deducted proportionately each time a loan disbursement is made.
When does the parent begin repaying the loan?
The repayment period for a Direct PLUS Loan begins when the loan is fully disbursed, and the first payment is due 60 days after the final disbursement. However, for Direct PLUS Loans with a first disbursement date on or after
July 1, 2008, the parent may defer repayment:
- While the student on whose behalf the parent borrowed the loan is enrolled on at least a half-time basis, and
- For an additional six months after the student ceases to be enrolled at least half-time.
How does the parent pay back the loan?
The parent will repay the servicer listed on the disclosure statement provided when he or she received the loan. The loan servicer will provide regular updates on the status of the PLUS Loan, and any additional PLUS Loans that a parent receives. The loan servicer also will be listed in the parent's account at www.nslds.ed.gov.
Repayment Plans -
The Direct PLUS Loan Program for parents offers three repayment plans-standard, extended, and graduated-that are designed to meet the different needs of individual borrowers. The terms differ between the repayment programs, but generally borrowers will have 10 to 25 years to repay a loan. To read more about repayment plans, go to the Repayment Information page on this Web site.
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You may, alternatively call us at 408.428.0208 to schedule an appointment.
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Directions to BioHealth College Campus
BioHealth College's Campus is centrally located in the heart of Sillicon Valley with easy access by light rail.