Federal Direct Stafford Loan
The Federal Direct Stafford Loan is available through the William D. Ford Federal Direct Loan Program to help pay for educational expenses. The Penn State Office of Student Aid awards Federal Direct Stafford Subsidized or Federal Direct Stafford Unsubsidized Loans, or a combination of both, based on financial need.
Eligibility
Meet Federal and Penn State Financial Aid Eligibility Requirements.
Subsidized vs. Unsubsidized
Subsidized Stafford Loan |
Unsubsidized Stafford Loan |
|---|---|
| Based on financial need |
Not based on financial need |
| The federal government pays the interest on the loan while you are enrolled in school at least half-time. | Interest begins accumulating as soon as funds are disbursed until the loan is paid in full. Accrued interest will be added to the balance of the loan. (You are not required to pay the interest while you are in school, but we recommend that you do.) |
Undergraduate student fixed Interest rates:
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Undergraduate fixed Interest rates:
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Graduate student fixed Interest rates:
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Graduate fixed Interest rates:
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Origination fees:*
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Origination fees:*
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* The total origination fee is 1 percent; however, from July 1, 2011 through June 30, 2012, Direct Loans offered a 0.5 percent rebate on this origination fee. As of July 1, 2012 the 0.5 percent rebate will be discontinued.
How to Apply
You will automatically be considered for the Stafford loan if you submit the Free Application for Federal Student Aid (FAFSA).
Accept and receive your loan
If you are a first-time borrower, you will need to accept your loan.
Use your Federal Student Aid PIN (the PIN you used for the FAFSA) to sign into StudentLoans.gov and follow the instructions to:
- Complete your Entrance Counseling
- Sign your Master Promissory Note (MPN)
In most cases, you will only need to complete entrance counseling and sign an MPN once during your college career.
Financial aid made easier!
See our MPN and Entrance Counseling podcasts
If you have technical difficulty signing the MPN, please contact the U.S. Department of Education’s Direct Loan applicant services at 800-577-7394.
Understand net vs. gross loan amounts
Your Stafford loan will appear on both the Student Aid Summary and Bursar Tuition Bills section on eLion; however, the loan amounts will be different. The loan amount on the Student Aid Summary is the gross amount. In contrast, the Bursar Tuition Bills section will reflect the net amount after the loan origination fees have been deducted. Once you have accepted your loan and completed your registration, funds will automatically disburse to your student account after classes begin.
Example 1
You are awarded a $2,750 subsidized Stafford loan for one semester
- $2,750 is your gross loan amount
- $2,723 is your net loan amount that will disburse to your student account (gross amount minus the origination fee)
Example 2
You are awarded a $1,000 unsubsidized Stafford loan for one semester
- $1,000 is your gross loan amount
- $990 is your net loan amount that will disburse to your student account (gross amount minus the origination fee)
To decrease or cancel the loan
To decrease or cancel your loan, log into eLion and select "Loan Decrease." If you are a new student, this option will be available after your Penn State Access Account is activated during First-Year Testing, Consulting, and Advising Program (FTCAP) or at a Penn State Access Account Signature Station.
