How to Apply for a Federal Direct Stafford Loan
Step 1. Complete the Free Application for Student Aid (FAFSA). The FAFSA is the Department of Education’s online application which is required for anyone requesting federal financial aid. UA Little Rock’s school code is 001101. Once you have completed this form, the information will be sent to our office. Your financial aid package will be calculated and awarded to you via BOSS.
Step 2. Log in to BOSS and accept your loan.
Step 3. If you are a first time Stafford Loan borrower, complete an online Entrance Counseling session. You must complete the Stafford Entrance Counseling. This is an online loan counseling session which will take about 30 minutes to complete.
Step 4. Complete the Federal Direct Loan Application and Master Promissory Note. If you are a first time borrower through the Federal Direct Student Loan Program, you must apply for the Stafford Loan on the Department of Education’s website and electronically sign the Master Promissory Note.
More Information About the Federal Direct Stafford Loan
The Federal Direct Stafford Loan is the most common student loan program for funding undergraduate and graduate education. There are two types of Stafford loans, Subsidized and Unsubsidized, and they differ in the following ways:
Need-based versus Non-need-based – The subsidized loan is considered a need based loan which means it is only awarded to those students who can demonstrate a financial need for the loan funds. The unsubsidized loan is available to anyone whose other financial aid doesn’t meet the Cost of Attendance. Both loans require the borrower to complete the Free Application for Federal Student Aid (FAFSA).
In-School Interest Subsidy – Subsidized Stafford loans are interest-free as long as the borrower is enrolled at least half-time in a degree program at a university or college, and for the six month grace period that follows. Unsubsidized Stafford Loans begin accruing interest from the date of disbursement and interest continues to accrue while the borrower is in school.
Interest Rates for both loans are fixed rates. In some cases, the subsidized loans have a lower interest rate than the unsubsidized loans.
Loan Limits differ depending on the borrower’s grade level, dependency status, type of loan, and whether or not the borrower’s parent’s PLUS Loan has been denied.
- An undergraduate student’s dependency status is determined by the FAFSA.
- If a student is deemed independent, or his/her parent is denied a PLUS Loan, the student may borrow more in additional unsubsidized loans
Eligibility: To be eligible for a Stafford loan, you must be a U.S. citizen or permanent resident, not have previous defaults on a federal loan, be enrolled or plan to enroll at least half-time, and maintain satisfactory academic progress.
Loan Fees: Both the subsidized and the unsubsidized Stafford Loans have a 1.069% origination fee. The fee is deducted from the loan proceeds at disbursement.
Grace Period: Stafford Loans have a six month grace period. Repayment and, in the case of subsidized loans, interest accrual does not begin until six months after the student graduates, withdraws, or is enrolled less than half-time.
