Federal Stafford Loan Program
Revised 05/2006
Reviewed 05/2006
For many students loans are a necessary type of aid in paying for college. The University of Miami has several loan programs for students and parents to utilize while trying to pay for college. The Stafford loans are the most frequently used loans. They were created to help students meet the costs of a college education; they are insured by a state or private agency, reinsured by the federal government, and included in the Federal Family Education Loan Program (FFELP)
Subsidized Federal Stafford Loan*
This is the basic federal loan. For borrowers who receive new loans disbursed on or after July 1, 1998, the interest rate is variable and capped at 8.25%. For borrowers who receive new loans on or after July 1, 2006, the interest rate is fixed at 6.8%.
The interest during the enrollment period is paid by the federal government until you begin repayment. Repayment begins six months after you graduate, leave school, or are enrolled less than half time. You then may have up to 10 years to repay your loan. You are required to pay, at minimum, $50 per month during repayment ($600 per year); however, the minimum payment may be higher depending on the total amount of your loans. You may payoff your loan at any time without penalty.
Unsubsidized Federal Stafford Loan*
The Unsubsidized Federal Stafford Loan assists students who are not eligible for any portion of , or who do not qualify for the academic year maximum of, the Subsidized Federal Stafford Loan. Undergraduate dependent students must first be denied the Plus Loan before being awarded an Unsubsidized Federal Stafford Loan.
With any unsubsidized loan, you are responsible for the interest immediately upon the loan's disbursement - even when you are enrolled in school. While you are enrolled, you may choose to pay the accruing interest, or you may have the interest capitalized (added to the principal balance). When you receive your application to apply for a Federal Stafford Loan, which is called the Master Promissory Note (MPN), check the box in Question 12 if you want to make interest payments while you are in school; otherwise, interest will be deferred and capitalized.
Federal Stafford Annual Loan Limits
|
Year in School |
Subsidized & Unsubsidized |
Additional Unsubsidized |
|
|
Stafford Loan |
Stafford Loan |
| Gross | Gross | |
|
Freshman |
$ 2,625 | $ 4,000 |
|
Sophomore |
$ 3,500 | $ 4,000 |
|
Junior |
$ 5,500 | $ 5,000 |
|
Senior |
$ 5,500 | $ 5,000 |
|
5th Year |
$ 5,500 | $ 5,000 |
|
Graduate |
$ 8,500 | $ 10,000 |
Cumulative Loan Limits for the Subsidized
and Unsubsidized Federal Stafford Loans
| Dependent Undergraduate Students: | |||||
|
$23,000
|
||||
|
$23,000 $23,000
|
*Please note that students must also complete a review called the student's Entrance Counseling. Students are requested to complete this requirement on the following website: http://www.miami.edu/account-services/services/entrance.html. Although awarded, Stafford Loans cannot be disbursed without completing this review.
