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Federal Family Education Loan Programs, Interest Rates, & Loan Limits
There are three loan programs offered to help students and their parents to finance the cost of higher education. Loan eligibility is determined by the student's need (based on financial information submitted on the FAFSA) and on the student's dependent or independent status. The programs offered include the Subsidized Stafford loan (where the government pays the interest for the student while in school at least half-time and for six months after leaving school), the Unsubsidized Stafford loan (where the student pays the interest while in school and after leaving school), and the Parent Loan for Undergraduate Students (PLUS) available to parents and graduate students. This information is based
on Federal regulations available at the time of this posting. Loan limits
are based on full academic year programs.
A Dependent Student is defined as a student who is dependent upon the parents for support and does not meet the qualifications defined for an Independent Student. A Dependent Student's financial need is calculated based upon his/her income and assets AND the income and assets of his/her parents.
An Independent Student is specifically defined by Federal regulations as either: 24 years of age or older; or married; or a veteran of the armed forces; or a graduate or professional student; or a ward of the court; or has legal dependents other than a spouse. The loan limits listed below in the second column are for independent students and are available in addition to the loan limits listed in the first column.
Federal Loans First Disbursed on or After July 1, 2006
Rates are subject to change every July 1.
| Loan Type |
Status |
Interest Rate |
Effective Date |
| Stafford Subsidized & Unsubsidized |
All |
6.80% |
Fixed for the life of loan. |
| Parent Loan for Undergraduate Students (PLUS) and Grad PLUS (PLUS Pro)
for graduate student borrowers. |
All |
8.50% |
Fixed for the life of the loan. |
| Consolidation Loans |
All |
Interest rates are fixed rates calculated based on the weighted average
of the loans being consolidated rounded up to the next higher 1/8 percent,
not to exceed 8.25%. |
Federal Loans First Disbursed Between July 1, 1998 and June 30, 2006
These rates are calculated based upon statutory formulas and equal the
bond equivalent rate of the 91-day Treasury bills auctioned on May 29,
2007, plus certain statutory percentage add-ons. The 91-day Treasury bills
were auctioned at 4.919 percent, rounded to 4.92 percent.
| Loan Type |
Status |
Interest Rate |
Effective Date |
| Stafford Subsidized & Unsubsidized |
Repayment or Forbearance |
7.22% |
7/1/2007
to
6/30/2008 |
| Stafford Subsidized & Unsubsidized |
In-school, Grace, or Deferment |
6.62% |
| Parent Loan for Undergraduate Students (PLUS) and Grad PLUS (PLUS Pro)
for graduate student borrowers. |
All |
8.05% |
| Consolidation Loans |
All |
Interest rates are fixed rates calculated based on the weighted average
of the loans being consolidated rounded up to the next higher 1/8 percent,
not to exceed 8.25%. |
Federal Loans First Disbursed Prior to July 1, 1998
Interest rates on Stafford and PLUS loans are calculated using different statutory formulas, percentage add-ons, or both.
| Loan Type |
Origination
Fee* |
Federal Default Fee* |
Effective Date |
| Stafford Subsidized & Unsubsidized |
1.5% |
1% |
7/1/2007
to
6/30/2008 |
| Parent Loan for Undergraduate Students (PLUS) and Grad PLUS (PLUS Pro)
for graduate student borrowers. |
3% |
1% |
* The origination fee and federal default fee on all Stafford and/or PLUS
loans may be paid by your lender. Contact them for specific information.
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