What are the terms of the loan?
The subsidized Stafford Loan is interest-free to you during in-school, deferment, and grace periods. On the unsubsidized Stafford Loan, you are charged interest during those periods. You or your parents may have chosen to pay the interest on the unsubsidized loan while you were in school, or you may have allowed the interest to accrue and capitalize (be added to the principal amount). You should be aware that if you allowed your interest to accrue, your principal amount would be higher than the original amount you borrowed when it is time to enter repayment. The interest rate on the Stafford Loan effective July 1, 2006 is fixed at 6.80%, with a cap of 8.25%. Stafford Loans disbursed before July 1, 2006 are variable rate loans with an in-school rate of 6.54%. Rates change annually on July 1 for variable rate Stafford loans. When Do I Begin Repayment? The Stafford Loan has a six-month grace period, which means you begin repayment six months after you cease to be enrolled as a half-time s
Loans will settle on the same business day and will mature the following business day. The rate paid on the loan will be the same as the primary credit rate at the New York Fed. In addition, primary dealers will be subject to a frequency-based fee after they exceed 45 days of use. The frequency-based fee will be based on an escalating scale and communicated to the primary dealers in advance.
