Federal Stafford Loan
Puget Sound participates in the Federal Direct Student Loan program. Under this program the federal government serves as the lender.
There are two types of Federal Stafford loans.
- Subsidized Stafford loans are need-based loans. The government pays the interest on these loans while you are enrolled at least half-time. The interest rate for undergraduate loans is fixed at 3.4% for the 2012-13 academic year.
- Unsubsidized Stafford loans are not need-based loans. The interest begins accumulating as soon as the funds are disbursed on your behalf. Interest may be paid on a monthly basis or capitalized so that payments do not need to be made while you are enrolled. Capitalization results in the interest being added to the principal creating a higher loan to repay after graduation. The interest rate for these loans is fixed at 6.8% for the 2012-13 academic year.
How to Apply
Your Financial Aid Award Notice specifies the amount of your Stafford Loan eligibility. You may reduce or decline the offered amount by sending an email message to firstname.lastname@example.org.
First Time Borrowers
If you are a first-time borrower, you must complete an online loan entrance counseling session and sign a Master Promissory Note (MPN) before you can receive your loan funds
Disbursement of Funds
The annual loan amount you borrow for the year is divided equally between fall semester and spring semester. A fee of 1% will be subtracted from each disbursement to cover the loan origination fee. Stafford loans are received by the university through Electronic Fund Transfer (EFT) and are credited to your student account automatically. We will notify you when funds are received and credited to your student account.
Repayment begins six months after graduation or when dropping below half-time enrollment. You can expect to hear from your lender/lenders about 30-45 days before the first payment is due. If you don't hear from your lender, it is your responsibility to contact them.
Subsidized Stafford Loans for Graduate Students
Congress passed the Budget Control Act of 2011 in August of this year. The Act includes changes to several aid programs, including the Stafford Loan program for graduate students. Effective July 1, 2012, graduate students will be limited to borrowing through the Unsubsidized Stafford Loan program, and the Subsidized Stafford Loan program will no longer be available. Annual and aggregate loan limits remain unchanged. Under the Unsubsidized Stafford program, loans begin accruing interest as soon as the funds are disbursed. Interest may be paid on a monthly basis or capitalized so that payments do not need to be made while enrolled. This change effects loans disbursed on or after July 1, 2012. Any previous Subsidized Stafford loan held by the student will not be affected.