Federal Direct Student Loans
You apply for the Federal Direct Stafford Loan by filing the Free Application for Federal Student Aid(FAFSA) for each aid year.The IU Kokomo school code is 001814. To maximize your consideration for all types of financial aid, you need to file the FAFSA each year by the March 10 Priority Application Receipt deadline.
- Interest rates:
- For loans first disbursed on or after July 1, 2013; fixed interest rate of 6.8%. For first time borrowers there is a limit of 150% of the subsidized loans.
- For subsidized loans to undergraduates disbursed on or after July 1, 2013; the interest rate is fixed at 6.8%.
- Origination fee of 1.051% assessed by the Direct Loan servicer.
- Two types of Federal Direct Stafford Loan:
- Subsidized: a need-based loan with the U.S. Department of Education paying the interest while you are enrolled at least
half-time. Effective for subsidized loans first disbursed between July 1, 2012 and July 1, 2014 you will be responsible for the interest during your grace period.
- Unsubsidized: a non-need based loan with interest accruing on the loan after disbursement.
- Repayment does not begin until six months after the student graduates or drops below half-time enrollment.
- Master promissory note (MPN) and Entrance Counseling:
- The Master Promissory Note is valid for ten year so continuing students are only required to complete these step if they choose
to change lenders or the ten year limit expires.
- A student must be enrolled at least half-time (undergraduate students: 6 semester hours / graduate students: 4 semester hours) to be eligible.
- Federal Direct Stafford Loan eligibility is limited by federal aggregates:
- Federal Direct Stafford Loans must be awarded before the final day of the semester. Students are responsible to complete the FAFSA and to resolve any issues to allow adequate time to determine financial aid eligibility and to award financial aid.
- Problems repaying Federal Direct Stafford Student Loans? Options available to you are deferment or forbearance