<p>I recently sent in my FAFSA (about 3 weeks ago, I know, I'm late) and it says that I've been awarded 1750 ESTIMATED Stafford Subsidized Loan and 9k ESTIMATED PLUS Loan. Because these are estimated, does that mean they are not actually going to supply this amount? Also, since I applied for FAFSA so late, I also was awarded about the same amount for the fall 08. Can I somehow transfer those unused loans over to the upcoming semester? I'm mainly interested in the Stafford Loans and I go to UT Austin if that helps.</p>
<p>Oh, and I haven't accepted the awards yet. Is there a specific deadline to when I have to accept so that it'll cover part of my tuition due on January 8th, 2009?</p>
<p>Schools have their own deadlines for accepting awards. You would need to ask your school what their deadline is. You also need to ask if you have to apply to an outside source for the loan. My daughter has a 'direct' loan which is actuall loaned direct by her school. All she had to do was accept the offer and do the paperwork, which included an online promissory note, and the loan was credited to her account. At my son's school the process was quite different as they do not do direct loans. He had to apply to an outside bank for his Stafford loan. You need to check with your school for how you should proceed.</p>
<p>You may e too late to get the loan for the fall semester as it is over. Again check with the school.</p>
<p>This is probably a really stupid question, but can somebody explain to me exactly how interest rates work? I know that you have to pay 6.8% of the total loan, but do you have to pay that every month or every year? Once again, sorry for the ignorant question!</p>
<p>You may be able to get the full stafford ($3500) and the Plus ($9000) for the spring '09. Do not delay in selecting a lender, use your school's preferred lender if not then one of the sponsers of CC. There is not much difference between lenders at this time. If you are quick and the school can verify your enrollment before jan 01 you may be awarded for fall and then again awarded spring to make the total of $3500 and $9000. You may be awarded the full amount of $3500/$9000 for Spring 09. You must apply for the Stafford and your Parents must apply for the PLUS. Online or by phone. Very quick, 15 minutes tops. </p>
<h1>4. Interest and Interest payments are explained in the website of your lender, before signing for the loan (infact some lenders make you verify that you have read the terms by making you print out the terms) before you sign for the loans.</h1>
<p>Your main problem is finding a lender, not which lender.</p>
<p>Check and compare the bank's terms. Stafford loans can charge origination fees of up to @ 3%. These fees are deducted before the loan is given to you. This would mean that if you had a 3% fee on a $1750 loan you would only actually receive $1697.50 ($1750 - $52.50, which is 3% of $1750) You would still owe $1750 but they deduct the fee from it. Some banks offer the loans without any fees. Others may offer other benefits such as interest rate decreases for on time payments. My personal choice would be to go for the 'bird in the hand' , that is the no up front fees.</p>
<p>Interest rates for Stafford loans are set by the government. Currently 6% for subsidized and 6.8% for unsubsidized. Some banks will make it sound like they are offering some special rate - these rates are the same for all Stafford loans.</p>
<p>
[quote]
I know that you have to pay 6.8% of the total loan, but do you have to pay that every month or every year? Once again, sorry for the ignorant question!
[/quote]
If it is an unsubsidized loan then interest starts to accrue from the day the loan is paid to you. When the interest actually has to be paid depends on the terms of your loan with your bank. It may be monthly, quarterly etc. Many banks will let your defer the interest - that is put off paying it until you graduate or drop below 1/2 time. You have to realize the interest is still being charged and added to the debt. For interest of you defer the interest and the bank capitalizes it annually then at the end of year 1 you will owe $1750 plus 6.8% interest of $119 = $1869. In year 2 the interest will be charged on the new loan balance of $1869 so the amount of interest in year 2 will increase to $127 and at the end of year 2 you will owe $1996. AT the end of 4 years the original loan of $1750 will have grown to $2271.</p>
<p>If the loan is subsidized the govt pays the interest until you graduate or drop below 1/2 time plus a grace period of 6 months.</p>
<p>If you are a freshman, you are eligible to borrow up to $5500 in Stafford loans. Up to $3500 may be subsidized, but you can only borrow sub loans in the amount of Cost of Attendance - Expected Family Contribution - all other aid. If you can't borrow all $3500 sub, you still can borrow unsub up to a total of $5500 for sub & unsub. Whether or not you can get this all in one semester depends on several factors. The best thing to do is talk to your school & find out what YOUR situation is.</p>