Federal Stafford Loan

Terms and conditions of the Subsidized Federal Stafford Loan

  • Need-based loan
  • Available to U.S. citizens or permanent residents
  • Fixed interest rate of 6.8%.
  • The federal government pays interest during in-school period
  • Subsidized and Unsubsidized Federal Direct Loans have a 1.0% origination fee and also offer a .5% rebate on the origination fee ? resulting in a net fee of .5%, which will be deducted from the gross amount of the loan borrowed. Once you enter repayment, if you make your first 12 monthly payments on time, the rebate becomes permanent. If you fail to make 12 on-time monthly payments; however, a charge for the initial rebate will be added to the outstanding balance of the loan.
  • $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
  • Fixed interest rate of 6.8%.
  • $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
  • Subsidized and Unsubsidized Federal Direct Loans have a 1.0% origination fee and also offer a .5% rebate on the origination fee ? resulting in a net fee of .5%, which will be deducted from the gross amount of the loan borrowed. Once you enter repayment, if you make your first 12 monthly payments on time, the rebate becomes permanent. If you fail to make 12 on-time monthly payments; however, a charge for the initial rebate will be added to the outstanding balance of the loan.
  • 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.