Federal Direct Stafford Loans Undergraduates

The Direct Stafford Loan allows students to borrow in their own name and requires no credit evaluation. A Free Application for Federal Student Aid (FAFSA) is required for all loan applicants. There are two types of Federal Stafford Loans: the Federal Direct Subsidized Stafford Loan and the Federal Direct Unsubsidized Stafford Loan.

Federal Direct Subsidized Stafford Loan:  Loans made from July 1, 2012 to June 30, 2014 interest does not accrue during in-school, but interest does accure while in the six month grace period and deferment. Repayment begins upon termination of college enrollment on at least a half-time basis.

Federal Direct Unsubsidized Stafford Loan:  The student (borrower) is charged interest. Interest accrual begins immediately during in-school, grace period and deferment. Interest accruing during these periods may be paid or capitalized. Repayment begins upon termination of college enrollment on at least a half-time basis.  Dependent Undergraduate students whose parents are unable to obtain a Federal Direct Parent PLUS Loan may receive increased loan limits under the Unsubsidized Direct Stafford Loan Program.

Deadline:
Federal Direct Stafford Loan applications must be certified by the Financial Aid Office by the last day of the semester.

Interest Rate:

Loans disbursed between July 1, 2016 and June 30, 2017 have a fixed interest rate of 3.76% for both the Subsidized and Unsubsidized loans during this period.

Fees:
Effective December 1, 2013, sequestration of federally budgeted funds occured.  

The origination fee is 1.069% from October 1, 2016 through September 30, 2017.  The net disbursement amount equals 98.931% for each disbursement of the loan.

Loan Limits per Academic Year:
Please refer to the following chart for the maximum amount students may borrow in the Federal Direct Stafford Loan per academic year. Please note, for periods of study shorter than an academic year, the amounts students can borrow may be less than those listed. In addition, loan amounts may be less if students receive other financial aid that is used to cover a portion of their cost of education. Students will be automatically certified for the maximum amount allowed based upon grade level, cost of education, and other financial aid received.

Maximum Academic Year Loan Limits
for Federal Direct Stafford Loans

Undergraduate Level - Dependent Students (Except Students Whose Parents Were Denied PLUS)

*Base
Amount

Unsubsidized Loan Amount

1st Year (Freshman - 0 to 29 credits)

$3,500

$2,000

2nd Year (Sophomore - 30 to 59 credits)

$4,500

$2,000

3rd Year (Junior - 60 to 89 credits)

$5,500

$2,000

4th Year (Senior - 90+ credits)

$5,500

$2,000

5th Year (Teacher Certification & Preparatory Coursework for Graduate or Professional Admission)

$5,500

$0

Undergraduate Level - Independent Students and Dependent Students Whose Parents Were Denied PLUS

*Base
Amount

Additional Unsubsidized Loan Amount

1st Year (Freshman - 0 to 29 credits)

$3,500

$6,000

2nd Year (Sophomore - 30 to 59 credits)

$4,500

$6,000

3rd Year (Junior - 60 to 89 credits)

$5,500

$7,000

4th Year (Senior - 90+ credits)

$5,500

$7,000

5th Year (Teacher Certification & Preparatory Coursework for Graduate or Professional Admission)

$5,500

$7,000

Graduate Level

Each Year

$20,500 - Beginning July 1, 2012 Graduate Loans will be entirely Unsubsidized. 

Aggregate Loan Limits:
Please refer to the following chart for the maximum amount students may borrow in the Federal Stafford Loan for their entire academic career.

Aggregate Loan Limits for Federal Direct Stafford Loans

Dependent
Undergraduate
Student

Independent
Undergraduate Student
or
Dependent Undergraduate
Student with PLUS Denial

Graduate Student

$31,000 -No more than $23,000 of this amount may be in subsidized loans.

$57,500 - No more than $23,000 of this amount may be in subsidized loans.

$138,500 - No more than $65,500 of this amount may be in subsidized loans.  The graduate aggregate limit includes Stafford Loans received for undergraduate study.

Loan Reductions/Cancellations:
Students may request the Federal Direct Stafford Loan be reduced or canceled. The request must be in writing from the student, not the parent. Through your University of Scranton email, please include your name, your Royal ID Number, and the amount you want the loan reduced to.