Loans
Direct Stafford Loans
Direct PLUS Loans
Alternative Student Loans
What are Direct Stafford Loans?
These loans are made through the Federal Direct Loan Program, which is administered by the U.S. Department of Education. They can be subsidized or unsubsidized. Students can receive a subsidized loan and an unsubsidized loan for the same enrollment period. Repayment begins six months after graduation or six months after your enrollment status is less than half time (five or fewer credits).
A subsidized loan is awarded on the basis of financial need. Financial need is calculated by subtracting the Expected Family Contribution (EFC) from the Cost of Attendance (COA). The EFC is determined by the Department of Education and is calculated from your data on the Free Application for Federal Student Aid (FAFSA). The COA for undergraduate programs is determined by the University. Interest on this loan is not charged while students are in school and enrolled for six or more credits; also, the government subsidizes interest on this loan during the six month grace period (after graduation or enrollment below six credits).
An unsubsidized loan is a non-need based loan program. Students will be charged interest on this loan from the time the loan is disbursed until it is paid off. The interest can accrue during enrollment and during other periods of non-payment, but it will be capitalized. If this interest is not paid during enrollment, it is accrued and added to the principle balance of the loan. Capitalization occurs the day the grace (or deferment) period expires and the interest accrued over the loan period will be added to the original amount of the loan. This additional amount subsequently accrues interest, which adds an additional expense to the loan.
How much money can I borrow?
The amounts a student can borrow depend on grade level in college and on student status (dependent undergraduate, independent undergraduate, dependent undergraduate whose parents are unable to get a Direct PLUS Loan), or graduate student.
Annual Loan Limits for Direct Stafford Loans (first disbursed on or after July 1, 2008):
| Dependent Undergraduate Student |
Independent Undergraduate Student |
Graduate/ Professional Student | |
| 1st Year | $5,500 - No more than $3,500 of this amount may be in subsidized loans. | $9,500 - No more than $3,500 of this amount may be in subsidized loans. | $20,500 - No more than $8,500 of this amount may be in subsidized loan. |
| 2nd Year | $6,500 - No more than $4,500 of this amount may be in subsidized loans. | $10,500 - No more than $4,500 of this amount may be in subsidized loans. | |
| 3rd and 4th Years (each) | $7,500 - No more than $5,500 of this amount may be in subsidized loans. | $12,500 - No more than $5,500 of this amount must be in subsidized loans. | |
| Maximum Total Debt from Stafford Loans When You Graduate | $31,000 - No more than $23,000 of this amount may be in subsidized loans. | $57,500 - No more than $23,000 of this amount may be in subsidized loans. | $138,500 - No more than $65,500 of this amount may be in subsidized loans. The graduate debt limit includes Stafford Loans received for undergraduate study. |
Fairfield University participates with the Direct Loan Program and does not have a preferred lender list. Fairfield University abides by all principles outlined in the CT Code of Conduct.
How do I apply for a Direct Stafford Loan?
Students must first submit the FAFSA. The Office of Financial Aid will notify the student in writing (e-mail or mail) of eligibility for a Direct Stafford Loan. If accepted, students must complete both the Entrance Counseling and the Master Promissory Note (MPN) in order for the loan proceeds to disburse at the University.
Complete your Entrance Counseling and Master Promissory Note
Note: Log in requires a student FAFSA Personal Identification Number (PIN).
What are the Direct Stafford Loan interest rates?
Interest rates vary for the Direct Stafford Loan program, for both undergraduate and graduate or professional students. Read below for the most updated information with respect to the Public Law 112-141, signed by President Obama on July 6, 2012. This law includes the following amendments to the Direct Stafford Loan Program:
- Direct Subsidized Loans first disbursed on or after July 1, 2012 and before July 1, 2013 will be 3.4 percent.
- Direct Unsubsidized Loans made, beginning on or after July 1, 2012, to both undergraduate and graduate or professional students remains at 6.8 percent.
- New Direct Stafford borrowers on or after July 1, 2013 will not be eligible for new Direct Subsidized Loans if the period during which the borrower has received such loans exceeds 150 percent of the published length of the borrower's educational program.
- A borrower reaching the 150 percent limit becomes ineligible for interest subsidy on all Direct Subsidized loans first disbursed to that borrower on or after July 1, 2013.
As part of the Budget Control Act of 2011, which passed on August 1, 2011, for undergraduate subsidized Stafford loan borrowers whose loans are first disbursed after July 1, 2012, the interest subsidy ceases once a student ceases at least half time enrollment. The government will no longer subsidize the interest for students during their grace period and this will be in effect for the next two academic years (July 1, 2012-June 30, 2013 and July 1, 2013-June 30, 2014).
All students who borrow with this federal loan programs must also satisfy the Exit Counseling requirement to fully understand the terms of loan repayment. Exit Counseling will be required prior to graduation from the University or at the time of withdrawal from the University or when enrollment drops below six credits.
Direct PLUS Loans (for parents)
What is a Direct PLUS Loan?
The Direct PLUS Loan is a loan that a parent can utilize to help pay for a student's educational expenses. This loan is for parents of dependent, undergraduate students who have an official FAFSA on file for the academic year in which the parent wishes to borrow the loan, confirmed enrollment of at least half time (six credits or more), and maintaining satisfactory academic progress (SAP) as required by the University. These loans are processed through the U.S. Department of Education. Parents must be credit-worthy and have no adverse credit history.
How much money can parents borrow?
An eligible parent can borrow up to the cost of attendance (COA) for the academic year, minus any other financial aid the student receives.
What if a parent is NOT approved for the Direct PLUS Loan?
If a parent is NOT approved for this loan, the student will be eligible to receive more loan funds in a Direct Stafford Unsubsidized Loan (amount varies by student status). Students will be notified of any additional loan funds via University e-mail.
How do parents apply for the PLUS Loan?
A parent can apply to complete the credit check and Master Promissory Note (MPN). Log in to apply requires the parent use his/her FAFSA Personal Identification Number (PIN). It is very important that after completing the application for a credit check that the MPN is completed immediately. If both items are not complete when the loan is approved, the University will be unable to process the loan for payment.
What is the interest rate on this loan?
Direct PLUS Loans disbursed after July 1, 2010 and before June 30, 2011 will have a fixed interest rate of 7.9%. Parents will be notified of interest rate changes throughout the life of their loan. Interest is charged on the loan from the date the first disbursement is made until the loan is paid off.
What are the loan repayment terms?
Payments are generally required on this loan while the student is in school and will begin after the loan is fully disbursed for the year; however, payments can be deferred until six months after the student graduates, leaves school, or is enrolled for less than six credits, only after the payment deferment process has been approved by the U.S. Department of Education. If payments are deferred during the in-school period and/or the six month post-enrollment period, parents will receive quarterly interest statements and have the option to pay the accrued interest. If such interest payments are not made, any unpaid accrued interest will be capitalized (added to the principal loan balance) at either the end of the in-school deferment or, if taken, the end of the six-month post-enrollment deferment, increasing the overall loan costs.
It is strongly recommended that students borrow the maximum in Direct Stafford Loans and/or Direct PLUS Loans before considering an alternative student loan. Direct loans may be less expensive, with fixed interest rates and with various options for repayment. The Office of Financial Aid will certify any alternative student loan at the request of any borrower, provided they are approved and provided the amount does not exceed their eligibility for the year. However, it is the responsibility of the borrower to determine which alternative loan best fits their borrowing needs.
What are alternative student loans?
Alternative student loans are available to assist students to cover any financial gap that may exist between their educational costs (cost of attendance) and the amount of financial aid they are receiving. There are many types of alternative student loans and each are calculated with different interest rates and repayment terms, which varies, depending on the borrower and cosigner's credit-worthiness. Students and families should review their finances to determine which financing option best fits their borrowing needs. Most undergraduate students usually require a credit-worthy cosigner in order to obtain the best rate and loan benefits.
How do I select the right alternative student loan?
Fairfield University does not have a preferred lender list for alternative student loans, nor can we recommend specific lenders. However, through ELM Select, a service provided by ELM Resources (see link below), can assist you with what is likely one of the most important tasks in the financial aid process. ELM Select is an online lender comparison resource that provides free and extensive loan options. This service has several features that will help you make the financing decision that best fits your financial needs. It also provides a wealth of information regarding borrower rights, responsibilities and loan repayment.
NOTE: This loan process can take at least three to four weeks to complete. Please apply as early as possible to allow for this processing time.
Fairfield University participates with the Direct Loan Program and does not have a preferred lender list. Fairfield University abides by all principles outlined in the CT Code of Conduct.
A Federal Perkins Loan is a low-interest loan (5% fixed, interest-free while in school) for students with exceptional financial need. Fairfield is the lender and servicer of this loan, which means loans must be repaid to the University. This loan is typically offered to first year undergraduate students, in the first year only, but may be a financing option provided as a result of an approved special conditions appeal. Read more about this federal loan program.
All students who borrow with the Federal Perkins Loan program must satisfy the Entrance Counseling requirement to fully understand their rights and responsibilities as a student loan borrower. Loans will not be approved or paid to the University until this initial requirement (and all other required loan forms) is complete.
All students who borrow with this federal loan programs must also satisfy the Exit Counseling requirement to fully understand the terms of loan repayment. Exit Counseling will be required prior to graduation from the University or at the time of withdrawal from the University or when enrollment drops below six credits.
Please contact the Office of Financial Aid if you have questions about any information on this page.