| Stafford Unsubsidized
Loan |
 |
 The
Federal Stafford Unsubsidized loan is a federally sponsored
student loan available at schools participating in the
FFELP. A bank, credit union, savings and loan association
or in rare cases the school itself can make the loan.
The school's primary role is to certify your eligibility.
A guarantor, a state agency
or non-profit corporation, insures the loan, which means
you can make the loan just on your signature. The guarantor
may charge a fee for this insurance.
This loan was created specifically
for students after high school and has many benefits
not ordinarily found in credit cards or other loan products.
Many students combine subsidized loans with unsubsidized
loans to borrow the maximum amount permitted each year.
You choose the lender. Keep in mind that this is the
beginning of a long-term relationship. It is a good
idea to use the same lender throughout your college
career. Multiple lenders can cause increased monthly
payments and complicate repayment.
Federal Stafford Unsubsidized
Loan is awarded as a "final option" after
consideration of financial need. This is not a need-based
loan. Anyone, regardless of having a financial need
or not, may be eligible for a Federal Stafford Unsubsidized
Loan. The amount of eligibility is determined in the
analysis of the submitted FASFA
(Free Application for Federal Student Aid) data
and by the school. The school will offer you the loan
in an award letter if you qualify.
Unsubsidized Stafford
Loans at a Glace
| Level
of Study |
Annual
Limits |
Lifetime
Limits |
Rate
Cap |
| Undergrad |
$2,625/$3,500/$5,5001 |
$23,000
2 |
8.25% |
| Grad |
$10,000 |
$138,500 |
8.25% |
1-
Stafford annual limits - As an undergraduate you may borrow
up to $2,625 per year for the first year, $3,500 for the second
year and up to $5,500 per year for the third and subsequent
academic years for a cumulative total of $23,000.
2- Stafford unsubsidized - As a dependent undergraduate
student you may borrow up to $2,625 per year for
the first year, $3,500 for the second year and up
to $5,500 per year for the third and subsequent
academic years for a cumulative total of $23,000.
Independent undergraduate students may be eligible
to borrow $6,625 the first year, $7,500 the second
year, and $10,500 per year the third and subsequent
years in subsidized and unsubsidized loans combined.
|
TERMS:
| 1. |
The
interest rate on a Federal Stafford Unsubsidized
loan cannot exceed 8.25 percent. |
| 2. |
The interest
rate varies annually and is adjusted each July 1.
You'll be notified of interest rate changes throughout
the life of the loan. |
| 3. |
You may be
required to pay an origination fee of up to 3% of
the principal balance. This will be deducted from
the loan disbursement you receive which is then
paid to the Department of Education. |
| 4. |
Interest
is accruing (or accumulating) while you are in school.
You will be given a choice of paying your interest
while in school or deferring payment until you leave
school. If you choose to make interest payments,
you may reduce your payments and the overall cost
of your loan. |
| 5. |
If you do
not make interest payments, the interest on the
loan accrues and will be added to your principal
balance (called "capitalization") at the
time you enter repayment. |
| 6. |
A TIP. When
you fill out your Master Promissory Note, choose
to defer interest payments whether you intend to
pay or not. Then, you can make the payments if you
want to but you would not have to make the interest
payments. |
| 7. |
Repayment
begins six months after you graduate, withdraw,
or drop below half-time attendance and you may have
up to ten years to repay. The minimum payment amount
is $50 per loan. |
| 8. |
Many lenders
offer up-front discounts or repayment incentives
that affect the over-all cost of the loan. You should
examine these options carefully when choosing a
lender. You may get more money up-front, but actually
pay more in the long-term. |
APPLICATION PROCESS:
Complete the
Free Application for Federal Student Aid (FAFSA) found at http://www.fafsa.ed.gov/,
which will start the financial aid application process at your school.
Your school may also have an institutional application you must
complete. If the school offers and you accept a Federal Stafford
Unsubsidized loan, you will receive a Master Promissory Note that
you must sign and return as instructed.
OBTAINING YOUR LOAN MONEY
Normally, loans are disbursed in two equal disbursements,
at the beginning and middle of the academic period.
Schools disburse Stafford Unsubsidized Loans in one
of two ways:
- Electronic funds transfer (EFT), which
allows your lender to transfer your money directly to a school's
bank account and subsequently to your student account.
- Paper check made payable to you and
your school and sent directly to the school for endorsement.
Choose Brazos Educational
Assistance, Inc. to obtain Diamond Benefits
(Lender Code #833228)
| For more information,
contact us at: |
BRAZOS EDUCATIONAL ASSISTANCE
P.O. Box 14445
Austin, TX 78761-4445
Austin office: (800) 375-9208
loans@bhesc.org |
|
