Stafford Loans: The Basics

campus explorer directory All information about campus, colleges, mayors, universities and US education and formation

  Stafford Loans: The Basics

What's a Stafford Loan? Find out how these undergraduate and graduate student loans could help you pay for college.

March 06, 2014


Stafford Loans: The BasicsLike all federal aid, you apply for a Stafford Loan by completing the Free Application for Federal Student Aid (FAFSA) form.
Photo: Thinkstock

Stafford Loans are one of the most common types of college financial aid funded by the federal government. If you’re concerned about how you’ll pay for a college degree at a community college or four-year college or university, a Stafford Loan can help you cover the costs of your college education at a fixed rate.

Like all federal aid, you apply for a Stafford Loan by completing the Free Application for Federal Student Aid (FAFSA) form. This form asks you about your family’s financial situation in order to determine how much money for college you can pay, and how much financial need you have for scholarships, grants and college loans.

Subsidized loans are awarded based on financial need and the federal government will pay any accrued interest while you’re in school.

When you are accepted into a college or university, you will receive a financial aid award letter, which details the amount of aid you’ve received, breaking down the amounts for all of the college loans, scholarships and grants you’ve been awarded. If the Stafford Loan is offered to you, you’ll want to learn more about the terms and conditions of this loan before you decide whether to accept it.

What Is the Stafford Loan?

The Stafford loan offers a fixed interest rate that is often lower than a college student would find on a private loan. These college loans come in two forms: subsidized and unsubsidized.

Subsidized loans are awarded based on financial need and the federal government will pay any accrued interest while you’re in school. The financial aid office of your loan will ask you to choose a lender, who will then require that you fill out a loan application. Once the loan is approved, the lender will send the money to your school.

On unsubsidized loans, you’re responsible for paying any interest and this interest starts accruing as soon as you receive your loan. These loans do not require you to prove financial need to receive them.

Who Qualifies for the Stafford Loan?

If you are a student pursuing your college education or a graduate program, like a masters degree, you could qualify for this federal aid. It is designed to supplement a student’s personal college money, as well as work-study programs, scholarships and grants.

To be eligible for this loan, you must be a U.S. citizen or eligible non-citizen who is enrolled in school on at least a part-time basis, and you must not currently have another education loan in default. You’ll receive your loan money for college in at least two installments per school year.

How are Stafford Loans Repaid?

Once you graduate from college, leave school or take classes part-time, your loan kicks in. Fortunately, you have a grace period of six months with the Stafford Loan before you have to start repaying that money for college.

How you repay your loan depends on the type of Stafford Loan you have. These loans have two sources of funding: College financial aid either comes directly from the Department of Education, if your school participates in the Federal Direct Loan Program, or from a private lender, if your school instead participates in the Federal Family Education Loan (FFEL) Program. So if you have a FFEL loan, you’ll pay back the private lender. If you have a Direct Loan, you’ll pay back the Department of Education.

Quick Facts

  • If you’re in the FFEL plan, you’ll be asked to choose a lender. Your college’s financial aid office can give you information on the school’s preferred lenders to compare student loans as well as help on evaluating each loan’s interest rates, terms and conditions.
  • You are able to get a loan deferment or forbearance in some cases. If you think you won’t be able to pay back your loan in coming months, be sure to talk to your lender and financial aid office to determine the best course of action.
  • Concerned about keeping track of multiple payment schedules for all of your student loans? Consider consolidating your loans into one monthly payment with one lender. Consolidating your loans can lower your monthly payment and make paying for college much easier, but it can increase the overall cost of your loan because the interest will be higher.

People Who Read This Article Also Read:

Student Loan Guide

Borrowing Basics

Different Types of College Loans

Subsidized Loans vs. Unsubsidized Loans

MGM Mansión hotel, uno de los hoteles más caros del mundo | Blog de Hoteles Curiosos

See All Guide to Student Loans and Borrowing Articles

Quick Search: Find the College that's Right for You!


Area of Study

- Select One - Agriculture and Natural Resources Arts & Humanities Business Communication & Media Cosmetology & Beauty Culinary Arts & Food Service Education Engineering Family and Consumer Science Professions Fitness, Recreation and Leisure Studies Funeral and Mortuary Services Health & Medical Services High School/Secondary Diploma Programs Interdisciplinary Studies Legal Professions Library Professions Life Science Life Skills Training Mathematics and Statistics Medical Residency Programs Military Science Natural Sciences Security and Protective Service Careers Skilled Trades Social Sciences Social Work Technician Careers Technology Transportation Careers Undecided Unknown Veterinary Medicine

Concentration (optional)

- Select One-


School Name

Search Advertisement]]>

Visit Our Student Center

Stafford Loans: The Basics

Get on track!

Visit our Student Center Stafford Loans: The Basics

And find out everything you need to know about planning for college.

Stafford Loans: The Basics

Visit our FREE

scholarship directory

Seach 1.9 million scholarships worth over $7.75 billion

Search Now!

Advertisement]]> Stafford Loans: The BasicsPrevious: Federal Perkins Loans Next: Parent Loan for Undergraduate Students (PLUS) Loans: the BasicsStafford Loans: The Basics


Original content at
All rights are reserved for the original content (link in the upper line) author's
Acording with the Digital Millennium Copyright Act (“DMCA”), Pub. L. 105-304 If you believe that your copyrighted work is being infringed, notify our team at the email

Top 20