Stafford Loan
The Stafford loan is usually the best option for students requiring additional funding for school once grants, scholarships
and other free aid is awarded. Federal Stafford Loans are made directly to the student. Interest rates on Stafford loans are
kept low because they are guaranteed by the government. Stafford loans are low-cost federal loans which are available to
undergraduate students at a fixed interest rate of 6.8% for unsubsidized and 6.0% for subsidized for the 2008-2009 academic
year. The subsequent year’s fixed rates for subsidized Stafford loans, as set by the Department of Education, will decrease as
shown in the chart below.
Subsidized Student Loans: The government pays the accrued interest on the loan while the student is still in school (at least
a half-time student), during the grace period and throughout approved deferment periods. Eligibility for this type of loan is
based on financial need.
Unsubsidized Student Loans: The student is responsible for the interest accrued on the loan. Repayment will begin after the
student graduates or enrolls in school less than half-time. Financial need or income levels are not factors for eligibility.
Benefits:
- .25% ACH: Interest rate is reduced by .25% if automatic payments are setup to be made directly from your bank account.
- Favorable Capitalization: Graduate Leverage Policy can save thousands of dollars
- One Point of Contact: Graduate Leverage Servicing provides students with one point of contact and combined billing for both federal and private loans.
- 24/7 Account Access: All Graduate Leverage borrowers have access to account information via an online account
- Targeted Repayment: An innovative service from Graduate Leverage that helps borrowers lower the cost of their debt by structuring their loan payments to retire the higher rate loans more quickly.
- Subsidy Optimization: As an organization that services its own loans, Graduate Leverage is able to provide on-going assistance to borrowers to help them optimize the usage of available programs to fit their needs. Programs include Income Based Repayment (IBR), Economic Hardship Deferment (EHD), Forbearance, and various loan forgiveness programs.
Stafford Loan details for the 2008-09 academic year:
| Loan Type |
Interest Rate |
Fees |
| Stafford Loan |
6.0% |
0% Federal Default Fee*
1% Origination Fee |
* Graduate Leverage has elected to work with national guarantors that have waived the Federal Default Fee on behalf of its borrowers. If your loan is processed with another guarantor you may be subject to a 1% default fee. Programs are subject to change.
Interest Rate for Undergraduate Subsidized Stafford Loans:
| Academic Year |
Rate |
| 2008-2009 |
6.0% |
| 2009-2010 |
5.6% |
| 2010-2011 |
4.5% |
| 2011-2012 |
3.4% |
Loan Limits
| |
Dependent Students |
Independent Students |
| 1st year |
$5,500 |
$9,500 |
| 2nd year |
$6,500 |
$10,500 |
| 3rd year |
$7,500 |
$12,500 |
| 4th year |
$7,500 |
$12,500 |