Federal Stafford Loan

Federal Stafford Loans are the most commonly borrowed student loans available to graduate and professional students. Northwestern University participates in the Federal Stafford Loan program under the Federal Family Educational Loan Program (FFELP) and works with various lenders to provide these loans to students. All lenders participating in the Federal Stafford Loan program must set the same interest rates. Some lenders may also offer repayment incentives and discounts for electronic and on-time payments. Students should contact the lender of their choice to determine what incentives they offer.

All first-time borrowers must complete an entrance interview on their rights and responsibilities as Federal Stafford Loan borrowers. Entrance counseling can be completed online.

The Federal Stafford Loan program consists of two types of loans: subsidized (need-based) and unsubsidized (non need-based).

Terms and conditions of the Subsidized Federal Stafford Loan include:

Need-based loan
Available to U.S. citizens or permanent residents
For all Stafford loans processed after July 1, 2006: Fixed interest rate of 6.8%. Lenders will offer various repayment incentives
The federal government pays interest during in-school period
Lenders may charge up to 1% guarantee fee and 3% origination fee from principal at disbursement
$8,500 maximum loan amount per academic year; $65,500 aggregate loan limit
Repayment begins six months after graduation, withdrawal from school, or when a student drops below half-time enrollment
The maximum repayment period can extend up to 30 years depending on loan limit

Terms and conditions of the Unsubsidized Federal Stafford Loan include:

Non need-based loan
Available to U.S. citizens or permanent residents
For all Stafford loans processed after July 1, 2006: Fixed interest rate of 6.8%. Lenders will offer various repayment incentives
Beginning in 2007-08, there is a $20,500 maximum loan amount per academic year MINUS the amount borrowed from the Subsidized Federal Stafford Loan
$138,500 aggregate loan limit including the amount borrowed from the Subsidized Federal Stafford Loan
Interest begins to accrue when the funds are disbursed to the student. Student may choose to make regular interest payments while in school, or have the interest capitalized at repayment
Lenders may charge up to 1% guarantee fee and 3% origination fee from principal at disbursement
Repayment begins six months after graduation, withdrawal from school, or when a student drops below half-time enrollment
The maximum repayment period can extend up to 30 years depending on loan limit

Terms and conditions are subject to change according to federal law. For more information about the Federal Stafford Loan program, visit Northwestern Student Loans.