Stafford loans are available for students enrolled at least half-time in a qualifying program and who are in good academic standing. Stafford loans may be either subsidized or unsubsidized.
Subsidized loan funds are awarded based on financial need. The federal government pays the student's interest while he/she is enrolled in school at least half-time in a qualifying program. The student begins paying interest when repayment of the loan begins.
Unsubsidized loan funds are not need based. The student will be charged interest from the time funds are disbursed until the loan is paid in full. Students may choose to make monthly interest payments while in school, or they can choose to defer interest payments. If the student chooses to defer interest, it will accrue and will be added to the principal amount of the loan. Please note, if interest is capitalized, it will increase the amount the student has to repay.
Students may receive a subsidized and unsubsidized loan for the same enrollment period. The interest rate for Stafford loans is variable with a cap of 8.25%. In addition to interest, students will be charged a fee of up to 4% of the loan which will be deducted proportionately from each loan disbursement. A portion of this fee goes to the federal government, and a portion goes to the guaranty agency to help reduce the cost of the loans.
The amount a student can borrow per academic year will depend upon enrollment and dependency status. The table below indicates loan amounts available to students:
|
Dependent Undergraduate |
Independent |
|
|
1st Year |
$3,500 |
$7,500 (only $3,500 of this amount may be subsidized loans) |
|
2nd Year |
$4,500 |
$8,500 (only $4,500 of this amount may be subsidized loans) |
The amounts indicated above are the maximum yearly amounts a student may borrow in both subsidized and unsubsidized loans. Students may receive less than these amounts if the student is receiving other financial aid that is used to cover a portion of the cost of attendance.
To apply for a Stafford loan, students should first complete a FAFSA. Once the student's award package is complete, the student should complete and sign the budget sheet and promissory note included with the Award Notification and return it to the Financial Aid Office. Please note, the promissory note is a binding legal document. The student is agreeing to repay the loan under certain terms when he/she signs the promissory note. Read the note carefully! Students will also need to attend a Pre-Loan Conference before loan funds can be disbursed. To schedule a Pre-Loan Conference click here or call the Financial Aid Office at (828) 254-1921 ext. 876.
The student will be notified by the lender by mail if he/she is approved for the loan. If a student is denied, he/she may appeal the loan denial with the lender. If the student is approved, the approval letter will contain two disbursement dates. Normally, the student may pick up his/her loan check(s) from the Business Office approximately five business days after the disbursement dates indicated on the loan approval letter. In addition, disbursement of a loan check to a first-time borrower who has never previously attended the college must be delayed for 30 days from the beginning of the borrower's enrollment as mandated by federal guidelines. Please understand that a Stafford Loan check will not be disbursed to a borrower earlier than the first day of class. If you are unable to pay tuition and fees and/or purchase books without the proceeds of your loan, you must make other payment arrangements with the Financial Aid Office prior to the first day of classes.
Once a student graduates, leaves school, or drops below half-time status, he/she will have six months before beginning repayment. The student is also required to participate in an exit counseling session online. (The exit counseling web site can be accessed by clicking here.) Loan payments will be made directly to the student's lender.