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Federal Stafford Loans Subsidized Stafford LoanThese loans come from banks and other private lenders. The federal government pays for the interest while you are in college and during the six month grace period after you graduate, leave school, or enroll in less than half-time. Subsidized Stafford Loans are awarded based on demonstrated financial need. Stafford interest rates will change to a fixed rate for loans disbursed on or after July 1, 2006. The fixed rate will be 6.8% during school, grace, deferment, and repayment periods. There will be no adjustable rate for loans disbursed after July 1, 2006. Existing Stafford Loans made July 1, 1998 through June 30, 2006 will maintain a variable interest rate adjusted each July 1, capped at 8.25%. Interest rates for these loans during the in-school, grace, and deferment periods, will be 6.62%. For periods of repayment, the interest rate will be 7.22%. Students submit a Loan Request Form and select their lender. Loans are processed/transmitted electronically and students must sign a Master Promissory Note. Unsubsidized Stafford LoanThese loans are similar to the Subsidized Federal Stafford Loans and are available to all eligible students, even those not demonstrating financial need. Unsubsidized Stafford Loans should be seen as a supplement since the borrower is responsible for paying all the interest on the loan. Payments are scheduled to begin within 60 days, but borrowers can defer their payments until they are out of school. When they do so, the interest is capitalized (added to the original loan amount). On this loan, the interest will begin accruing right away. The interest rate for Federal Unsubsidized Stafford Loans is the same as for the Federal Subsidized Stafford Loans. Federal Subsidized and Unsubsidized Stafford Loans are available through the Federal Family Education Loan Program (FFELP). Other loan types are also available. Regardless of the loan program, the process begins with the completion of a Free Application for Federal Student Aid (FAFSA). Interest Rates
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| Fall only loan: Dec. 1, 2008 Academic year or Spring only loan: May 1, 2009 |
Repayment Information
Repayment begins six months after graduation or after you are no longer enrolled at least half-time. For the Unsubsidized Stafford Loan, the student is responsible for all interest accrued. The minimum monthly payment is $50.
First-Time Borrower?
Students who are first time borrowers at SJSU must attend an Entrance Loan Counseling Session before any loan funds can be disbursed. Sessions last approximately one hour and answer questions regarding interest rate, deferments, and how to avoid default. Students must check with the Financial Aid Website beginning July 1st for a schedule of the upcoming Entrance Loan Counseling Sessions. Students may sign up by calling, emailing, or coming into our office.
The amount of the loan a student will receive is determined by the student's request as submitted on the Loan Request Form, and by other factors such as the cost of attendance, loan eligibility, year in school, aid already awarded such as grants and scholarships, federal work-study, and so forth.
Lenders
Students are free to choose any lender they wish to borrow from . Those who have borrowed previously are encouraged to stay with their previous lender.
Maximum Amount
You may borrow up to the Cost of Attendance (budget) minus other financial aid the student has been awarded.
Enrollment Requirements
A student must be continuously enrolled for at least six units (half-time enrollment) each semester as an undergraduate to receive the loan. If the student drops below half-time at any time during the loan period, he/she will not be eligible for the loan proceeds. Disbursements arriving after the end of the term will be returned to the lender if the student has not received satisfactory grades for the minimum number of units required. Unsatisfactory grades are as follows: F,I,U, RD,NC,AU,WU and W.
Disbursement of Funds
Loan funds will be electronically transmitted to SJSU and disbursed to your student account to pay any outstanding debts owed to the university (tuition, fees, etc). The balance left, if any, is then sent by the Bursar's Office, and a check is disbursed to the mailing address which you maintain online on my.sjsu.edu
Summer Session
Students who wish to borrow for Summer Session 2008 must set up an appointment in mid-Spring with a financial aid counselor to determine their eligibility. Students who are academically disqualified from the University, attending Open University, or enrolled less than half time, are not eligible for the Stafford Loan. Please see a financial aid counselor if you have any questions on the Stafford Loan.
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Stafford Loan Application Process
Step 1: Complete and submit a FAFSA or Renewal FAFSA
Step 2: SJSU will send you an acknowledgement letter when SJSU receives your application data
Step 3: Review Award Notice on MySJSU
Step 4: Submit required loan documents
Step 5: Loan Disbursement
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Financial Aid & Scholarship Office
One Washington
Square
San José, CA 95192-0036
408-283-7500
fao@sjsu.edu
Fed. School Code: 001155
