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Student Loans. Koester & Speshock 2013 . Types of Loans - Stafford. Stafford Loans - Most common type of Federal Student Loan 2 Types: Subsidized Unsubsidized. Types of Loans - Stafford Loans.
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Student Loans Koester & Speshock 2013
Types of Loans - Stafford Stafford Loans - Most common type of Federal Student Loan 2 Types: • Subsidized • Unsubsidized
Types of Loans - Stafford Loans Subsidized - government pays interest while student is in school, during deferment periods, or during 6 month grace period after school. Who can borrow: • Students with financial needs • U.S. citizens or eligible non-citizens • Enrolled at least half-time in a set program
Types of Loans - Stafford Subsidized (continued): Loan Limit: $23,000 total; Up to $3,500 in first year Up to $4,500 in second year Up to $5,500 each additional year
Types of Loans - Stafford Subsidized (cont.): Interest Rate: 3.4% Repayment: (Up to 10 years) Begins 6 months after - • Graduation • Withdraws • Drops below half-time
Types of Loans - Stafford Unsubsidized - Interest accrues from beginning of loan. Who Can Borrow: • U.S. citizens or eligible non-citizens • Enrolled at least half-time in a set program
Types of Loans - Stafford Unsubsidized (cont.) Loan Limit: • Same base amounts as subsidized • Can apply for additional $2,000 per year for total of $31,000 • If denied PLUS loan, can apply for additional $6,000 - $7,000 per year for total of $57,500
Types of Loans - Stafford Unsubsidized (cont). Interest Rate: 6.8% Repayment: (Up to 10 years) Begins 6 months after - • Graduation • Withdraws • Drops below half-time
Types of Loans - Perkins Perkins Loan - low-interest federal loans, administered by the school, for students who demonstrate exceptional financial need. Who can borrow: • Students with exceptional financial needs • U.S. citizens or eligible non-citizens • Enrolled at least half-time in a set program
Types of Loans - Perkins Loan Limit: Up to $5,500/year; $27,500 Total Interest Rate: 5%; paid by government while student is in school and during grace period. Repayment: (Up to 10 years) Begins 9 months after - • Graduation • Withdraws • Drops below half-time
Types of Loans - Parent PLUS Parent PLUS Loan - covers expenses not covered by other Federal Aide. Can be taken out by dependent students' parents. Who can Borrow: Natural, adoptive, or step parents of students • U.S. citizens or eligible non-citizens • Enrolled at least half-time in a set program • Must have good credit
Types of Loans - Parent PLUS Loan Limit: No limit. Equal to total costs minus additional loans. Interest Rate: 7.9% Repayment: (Up to 10 years) Begins immediately after disbursed May apply for grace period, interest still accrues
Types of Loans - Other Options Institutional - non-federal aid that schools loan students. Private & State - Non-federal aid for students who cannot cover the cost of attendance. Interest Rates and Repayment Options vary.
Resource American Student Assistance http://www.asa.org/basics/loans/types/default.aspx