Stafford Loan Limits
The following chart illustrates the annual and aggregate loan
limits for the subsidized and unsubsidized Stafford loans first
disbursed on or after July 1, 2008.
The limits may be a little confusing because there are two sets of
limits for the Stafford loan: a combined base limit for the subsidized
and unsubsidized Stafford loan, and an additional limit for just the
unsubsidized Stafford loan. In effect, the subsidized Stafford loan is
limited to the amounts in the "Combined Base Limit" column and the
unsubsidized Stafford loan is limited to the amounts in the "Total
Limit" column minus the amount of any subsidized Stafford loans.
Many students combine subsidized loans with unsubsidized loans to borrow the
maximum amount permitted each year.
Note also that there are separate limits for dependent undergraduate
students, independent undergraduate students, graduate and
professional students, and medical school students.
Dependent undergraduate students whose parents have been
denied a Parent PLUS loan are eligible for the higher unsubsidized
Stafford loan limits available to independent undergraduate students.
| Annual Loan Limits - Stafford Loan |
Dependent Students
(whose parents were not denied a PLUS loan) |
Combined Base Limit for Subsidized and Unsubsidized Loans |
Additional Limit for Unsubsidized Loans |
Total Limit for Unsubsidized Loans (minus subsidized amounts) |
| First-Year Undergraduate (Freshman) |
$3,500 |
$2,000 |
$5,500 |
| Second-Year Undergraduate (Sophomore) |
$4,500 |
$2,000 |
$6,500 |
| Third-Year and Beyond Undergraduate (Junior, Senior) |
$5,500 |
$2,000 |
$7,500 |
| Preparatory Coursework (for enrollment in an undergraduate program) |
$2,625 |
$0 |
$2,625 |
| Preparatory Coursework (for enrollment in a graduate or professional program) |
$5,500 |
$0 |
$5,500 |
| Teacher Certification Coursework |
$5,500 |
$0 |
$5,500 |
Independent Students
(and dependent students whose parents were denied a PLUS loan) |
Combined Base Limit for Subsidized and Unsubsidized Loans |
Additional Limit for Unsubsidized Loans |
Total Limit for Unsubsidized Loans (minus subsidized amounts) |
| First-Year Undergraduate (Freshman) |
$3,500 |
$6,000 |
$9,500 |
| Second-Year Undergraduate (Sophomore) |
$4,500 |
$6,000 |
$10,500 |
| Third-Year and Beyond Undergraduate (Junior, Senior) |
$5,500 |
$7,000 |
$12,500 |
| Preparatory Coursework (for enrollment in an undergraduate program) |
$2,625 |
$6,000 |
$8,625 |
| Preparatory Coursework (for enrollment in a graduate or professional program) |
$5,500 |
$7,000 |
$12,500 |
| Teacher Certification Coursework |
$5,500 |
$7,000 |
$12,500 |
| Graduate and Professional Students |
Combined Base Limit for Subsidized and Unsubsidized Loans |
Additional Limit for Unsubsidized Loans |
Total Limit for Unsubsidized Loans (minus subsidized amounts) |
| Graduate and Professional Students |
$8,500 |
$12,000 |
$20,500 |
| Medical School Students |
$8,500 |
$32,000 |
$40,500 |
| Aggregate Loan Limits - Stafford Loan |
| |
Combined Base Limit for Subsidized and Unsubsidized Loans |
Additional Limit for Unsubsidized Loans |
Total Limit for Unsubsidized Loans (minus subsidized amounts) |
| Dependent Undergraduate Students (whose parents were not denied a PLUS loan) |
$23,000 |
$8,000 |
$31,000 |
| Independent Undergraduate Students (and dependent students whose parents were denied a PLUS loan) |
$23,000 |
$34,500 |
$57,500 |
| Graduate and Professional Students |
$65,500
(including undergraduate Stafford loans) |
$73,000 |
$138,500 |
Medical School Students
(Effective 4/18/08 per DCL GEN-08-04)
|
$65,500
(including undergraduate Stafford loans) |
$158,500 |
$224,000 |
Previous Stafford Loan limits can be seen on the
historical loan limits
page.
Stafford Loan Interest Rates and Fees
Stafford Loans have a fixed interest rate of 6.8% for loans with a
first disbursement after July 1, 2006. (Previously, Stafford Loans had
variable interest rates (based on 91-day T-bill
rate + 1.7% during school with an additional 0.6% increase upon
graduation) capped at 8.25% or less, depending on yearly
adjustments.) All lenders offer the same rate for the Stafford Loan,
although some give discounts for on-time and electronic payment.
The College Cost Reduction and Access Act of 2007 reduced the
interest rates on subsidized Stafford loans for undergraduate students
starting July 1, 2008. These reductions are available only to
undergraduate students, not graduate students, and only for subsidized
Stafford loans, not unsubsidized Stafford loans. The interest rates
are illustrated in the following table.
Phased-in Cuts in Interest Rates on
Subsidized Stafford Loans for Undergraduate Students |
| Year |
Interest Rate
Subsidized Stafford Loans
(Undergraduate Students) |
Interest Rate
Other Stafford Loans
(Graduate or Unsubsidized) |
| 2007-08 |
6.8% |
6.8% |
| 2008-09 |
6.0% |
6.8% |
| 2009-10 |
5.6% |
6.8% |
| 2010-11 |
4.5% |
6.8% |
| 2011-12 |
3.4% |
6.8% |
| 2012-13 |
6.8% |
6.8% |
Stafford Loans have loan fees of 4%, which are deducted from the
disbursement check. These fees consist of a 3% origination fee and a
1% default fee (previously "guarantee fee"). Starting July 1, 2006, the default fee will be
mandatory. (Previously, guarantee agencies could waive the fee and
many did.) The origination fee will drop from 3% to 2% on July 1,
2006, and will drop by a further 0.5% each successive July 1, until
it is phased out entirely on July 1, 2010.
Applying for a Stafford Loan
To apply for a Stafford Loan, you must submit the
Free Application for Federal Student Aid
(FAFSA). Even though the unsubsidized Stafford Loan is available
to all students regardless of financial need, you must still submit
the FAFSA to be eligible. You can receive a subsidized loan and an
unsubsidized loan for the same period.
You may
use the
Lender Codes Database
to obtain the lender codes of participating student loan providers.
FinAid also maintains a list of education lenders
who offer
federal and private student loans.
If you are a student attending a school that participates in the Federal Direct
Student Loan Program you will obtain your federal student loan funds directly
from the U.S. government, not from private lenders.
Perkins Loan
The Perkins Loan is awarded to undergraduate and graduate students
with exceptional financial need. This is a campus-based loan program,
with the school acting as the lender using a limited pool of funds
provided by the federal government. (The Perkins
Loan is the best student loan available. It is a subsidized loan, with
the interest being paid by the federal government during the in-school
and 9-month grace periods. There are no origination or default fees,
and the interest rate is 5%. There is a 10-year repayment period.
The amount of Perkins Loan you receive is determined by
your school's
financial aid office. The program limits are $5,500 per year for
undergraduate students and $8,000 per year for graduate students, with
cumulative limits of $27,500 for undergraduate loans and $60,000 for
undergraduate and graduate loans combined.
The Perkins Loan also offers better cancellation provisions than the
Stafford or PLUS loans.
See the section on loan forgiveness for more details.
Other Student Loans
If your borrowing needs are not met by the federal programs, lenders
offer a variety of supplemental borrowing programs known as Private or Alternative Loans.
Parents of undergraduate students can borrow
parent loans
such as the PLUS Loan to pay for their children's
education.
Starting on July 1, 2006, graduate and professional students will also
be able to borrow money through the PLUS Loan program to pay for their own
education.
