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Loan Considerations and Loan Limits

Thinking about taking out student loans to pay college costs?

Students should determine whether borrowing is the best choice if needing additional funds for college. Consider these eight points before applying for a loan:

  1. Scholarships and grants may be available through the state student assistance agency in your home state.
  2. A number of computerized scholarship search services and financial aid reference materials are available in the IU Kokomo Library.
  3. The IU Kokomo Career Assessment Office offers comprehensive placement and counseling services for students interested in working part time, either on or off campus.
  4. If students or their parent(s) receive a college loan, it may reduce their eligibility for other types of financial assistance.
  5. If students receive other types of financial assistance, it may reduce their eligibility (or their parent or parents' eligibility) for loans.
  6. Loans must be repaid - some shortly after graduation or withdrawal from school, and some while the student is still enrolled in college.
  7. Loans must be repaid even if students do not complete their program of study or they cannot find a job immediately. Even if students are dissatisfied with the education they have received, they must still repay the money they borrowed.
  8. Students who establish poor records of educational loan repayment may damage their credit rating for other types of loans.  

Student Loan Limits

Annual Federal Stafford Loan Aggregate Limits
for Loans First Disbursed on or After July 1, 2008, for Dependent Students
(excluding students whose parents cannot borrow PLUS)

Class

Subsidized/Unsubsidized
Amount Combination

Additional Unsubsidized
Independent Student

Freshman

$3,500

$ 2,000

Sophomore

$4,500

$ 2,000

Junior

$5,500

$ 2,000

Senior

$5,500

$ 2,000

Teacher Certification

$5,500

$ 0

Annual Federal Stafford Loan Aggregate Limits
for Loans First Disbursed on or After July 1, 2008,for Independent Students
(and dependent students whose parents cannot borrow PLUS)

Class

Subsidized/Unsubsidized
Amount Combination

Additional Unsubsidized
Independent Student

Freshman

$3,500

$ 6,000

Sophomore

$4,500

$ 6,000

Junior

$5,500

$ 7,000

Senior

$5,500

$ 7,000

Teacher Certification

$5,500

$ 0

Graduate Students

$0

$20,500

FEDERAL STAFFORD LOAN AGGREGATE LIFETIME LIMITS
EFFECTIVE JULY 1, 2013

Student Status

Amount

Dependent Undergraduate

$31,000 (maximum $23,000 subsidized)

Independent Undergraduate

$57,500 (maximum $23,000 subsidized

Graduate/Profession

$138,500 (maximum $23,000 subsidized)

Dependent Undergraduate who borrows the maximum of $31,000 at 6.8% using the standard repayment plan will pay $356.75 per month for 120 months (10 years)

Independent Undergraduate who borrows the maximum of $57,500 at 6.8% using the standard repayment plan will pay $667.71 per month for 120 months (10 years)

Be careful about the federal maximum loan amounts listed. They are standard limits for everyone who is eligible to borrow; the amounts are not related to your personal earning potential. Continually borrowing the maximum amount that students are eligible to borrow on one or more student loan programs may be more than they will be able to repay after they leave school.

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