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FEDERAL STAFFORD LOANS

A student may apply for a Federal Stafford Loan by completing the Free Application for Federal Student Aid (FAFSA). Effective July 1, 2006, the interest rate was fixed at 6.8 percent (in-school repayment rate) for all Stafford Loans.  Effective July 1, 2008, the Federal Stafford Subsidized Loan interest rate will be 6.0 percent.   Students are required to be enrolled at least half-time. Once a student graduates, leaves school or drops below half-time status, a student is allowed a one-time, six-month grace period prior to repayment.

STUDENTS MAY CHOOSE ANY LENDER.  If assistance is needed in selecting a lender, PSU is providing a NEW tool  (FASTChoice) which will assist a student in identifying a lender.  This tool is provided by Great Lakes Higher Education Assistance Corporation (GLHEAC), a guarantor and servicer who works with a multitude of lenders, including lenders that PSU students have frequently used in the past.  FASTChoice will allow students to view a side by side comparison of benefits and loan terms.

To select a lender and apply for a Federal Stafford Loan electronically click here, You will be directed to FASTChoice where you will read required federal disclosure information and be directed to a Loan Options page.  Click on the Stafford Loan Tab to learn more about lender options.  It is strongly recommended that you use your federal PIN number to E-sign your required (MPN).  

Students must also complete an Online Entrance Counseling session using  the Federal Stafford & Perkins Combined Entrance Counseling site.  This process takes approximately 20 minutes to complete.  

The Federal Stafford loan awarded may be subsidized and/or unsubsidized, as described below:

A subsidized Federal Stafford loan is awarded on the basis of financial need (total cost minus estimated family contribution minus other financial aid). You are not charged any interest until you begin repayment or during deferment periods.

An unsubsidized Federal Stafford loan is not awarded on the basis of need. You’ll be charged interest from the time the loan is disbursed until it’s paid in full. If you allow the interest to accrue (accumulate) while you’re in school, or during other periods of non-payment, it will be capitalized. This means the interest will be added to the principal amount of your loan, and additional interest will be based on that higher amount.

If parents are determined ineligible to borrow through the Federal PLUS program, and notification is received by PSU of this denial, PSU will automatically process additional Unsubsidized Federal Stafford Loan eligibility. First and second year students are eligible for up to an additional $4,000 per year, while third through fifth year students are eligible for up to an additional $5,000 per year.

If your class level changes during the year, you may be eligible for an increase in your Federal Stafford Loan. If you wish to request an increase in your loan amount, please contact us via email or stop by our office to present the request in writing. For example, a second year student might begin the fall semester with 19 credits and have a Federal Stafford Loan of $3,500. During the fall semester, the student earns 12 credits, for a total of 31 credits by the beginning of the spring semester. The spring loan award could then be increased from $1,750 to $2,250 upon request.

The Federal Student Aid Ombudsman of the Department of Education helps resolve disputes and solve other problems with federal student loans. 

You may access your prior loan information on the National Student Loan Data System (NSLDS) website at: www.nslds.ed.gov. This site contains all of your federal Title IV aid history.