What is a grace period?
A grace period is the time during which borrowers do not need to begin repaying their loan. In the case of a Stafford Loan, the grace period typically encompasses the six months after the student finishes school or drops below half-time enrollment. Repayment can begin during the grace period if the borrower chooses to do so. On subsidized loans those payments will be applied directly to the principal of the loan, allowing full repayment of the loan sooner than expected. The Perkins Loan has a nine-month grace period.
