An Unsubsidized Stafford loan
is not based on the financial need of
the student. This is a federal loan which has
a variable interest rate that changes every year
on July 1. Even though the student does not have
to begin repayments until after six months from
leaving school, the student is responsible for
the interest on the loan as soon as the loan is
withdrawn.
Eligibility
– Student must be a citizen
or permanent resident of the United States. Student
must be enrolled in a post-secondary institution
as either a full or part-time undergraduate or
graduate student.
Interest Rate – Interest
rates are based on 91-day T-bill + 1.7% during
school and increase .6% upon graduation. Rates
are variable and may change July 1, however, they
are capped at 8.25%.
Pluses
• Amount is not based on financial need
of student
• Up to 10 years to repay the loan
• Repayment does not begin until 6 months
after graduation
• For dependent students, annual limits
start at $2,625 freshman year and increase to
$3,500 sophomore year, and $5,500 junior and senior
years
• For independent students, annual limits
start at $6,625 freshman year and increase to
$7,500 sophomore year, and $10,500 junior and
senior years
• Annual limits for graduate students are
$18,500/year (minus the amount from any Subsidized
Stafford loan awarded)
Minuses
• Student responsible for interest on loan
as soon as loan is withdrawn
• 4% origination/insurance fee applies
• For dependent students, cumulative loan
limits of $23,000 between Subsidized and Unsubsidized
Stafford loans.
• For independent students, cumulative loan
limits of $46,000 of which $23,000 may be in Subsidized
Stafford loans.
