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Table: Federal Student Loans for College

Many families rely on federal student loans to help pay for college. This table describes features of the most common federal loans.


Direct Unsubsidized Stafford Loan Direct Subsidized Stafford Loan Perkins Loan Direct PLUS Loan (Parent/Grad)
Description A federal student loan available to students regardless of financial need A federal student loan available only to students with demonstrated financial need A federal student loan available only to students with the greatest financial need A federal loan available to parents and graduate students with good credit histories regardless of financial need
Eligibility Undergraduate and graduate students enrolled at least half-time Undergraduate students enrolled at least half-time Undergraduate and graduate students (can be enrolled less than half-time) Parents of undergraduate students enrolled at least half-time, and graduate and professional students
Funds dispersed by Federal government Federal government College Federal government
Borrower Student Student Student Parent or graduate/ professional student
Based on financial need? No Yes Yes No
Interest rate for loans disbursed in academic year 2016/2017 3.76% fixed for undergraduates; 5.31% fixed for graduate students 3.76% fixed 5% fixed 6.31% fixed
Interest subsidized? No Yes1 Yes1 No
Grace period 6 months 6 months Generally 9 months 6 months
Loan limits for academic year 2016/2017 Dependent undergraduates: 1st year $5,500 ($3,500 subsidized), 2nd year $6,500 ($4,500 subsidized), 3rd to 5th year $7,500/year ($5,500 subsidized), $31,000 maximum

Independent undergraduates and dependent undergraduates whose parents don’t qualify for a PLUS Loan: 1st year $9,500 ($3,500 subsidized), 2nd year $10,500 ($4,500 subsidized), 3rd to 5th year $12,500/year ($5,500/year subsidized), $57,500 maximum

Graduate students: $20,500 per year, $138,500 maximum including undergraduate loans

Undergraduates: $5,500/year $27,500 limit

Graduate students: $8,000/year $60,000 limit (including undergraduate loans)

Total cost of education, minus any other financial aid received

Over the past 10 years, the amount of borrowing increased 78% under the unsubsidized Stafford Loan program, 26% under the Parent PLUS Loan program, and a whopping 262% under the Grad PLUS Loan program.

Source: College Board, Trends in Student Aid 2016, Table 1


1 The federal government pays the interest on the loan while the student is in school at least half-time, in a grace period, or in a deferment period.


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