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Apply for a Stafford Loan

Direct Loans are low-interest loans for students to help pay for the cost of a student’s education. The lender is the U.S. Department of Education rather than a bank or other financial institution. With Direct Loans, you borrow directly from the federal government and have a single contact for everything related to the repayment of your loans, even if you receive Direct Loans at different schools.

Loans are assigned to a loan servicer by the U.S. Department of Education after the loan is disbursed (paid out). The loan servicer is the company which handles the billing and other services including repayment plans and loan consolidation for the federal student loans.

Types of Direct Stafford Loans

  • Subsidized Loan: This type of loan is based on financial need. The interest rate for a subsidized loan at Highland Community College is fixed at 3.86% for the 2013-2014 academic year, 4.66% for the 2014-2015 academic year, 4.29% for the 2015-2016 academic year, 3.76% for the 2016-2017 academic year, 4.45% for the 2017-2018 academic year, 5.05% for the 2018-2019 academic year, 4.53% for the 2019-2020 academic year, 2.75% for the 2020-2021 academic year, 3.73% for the 2021-2022 academic year, 4.99% for the 2022-2023 academic year, 5.50% for the 2023-2024 academic year and 6.53% for the 2024-2025 academic year for undergraduate students.  The financial aid office will do a calculation to determine whether or not a student is eligible to receive a subsidized loan once the student has completed the loan application process.
  • Unsubsidized Loan: This loan is not based on financial need. Interest accrues from the date of disbursement until the final payment. The borrower can choose to pay the interest periodically while in school and during the grace period or can have the interest capitalized and added to the principal amount of the loan. The interest rate for an unsubsidized loan is fixed at 3.86% for the 2013-2014 academic year, 4.66% for the 2014-2015 academic year, 4.29% for the 2015-2016 academic year, 3.76% for the 2016-2017 academic year, 4.45% for the 2017-2018 academic year, 5.05% for the 2018-2019 academic year, 4.53% for the 2019-2020 academic year, 2.75% for the 2020-2021 academic year, 3.73% for the 2021-2022 academic year, 4.99% for the 2022-2023 academic year, 5.50% for the 2023-2024 academic year and 6.53% for the 2024-2025 academic year for undergraduate students.

Repayment

  • Repayment begins 6 months after graduating, dropping below half-time, or withdrawing from your academic program.
  • The Standard Repayment Plan is 10 years.
  • There are other payment options for borrowers who may need more time to repay or who need to make lower payments at the beginning of the repayment period.
  • If you have multiple federal education loans, you can consolidate them into a single Direct Consolidation Loan.
  • There may be a .25% interest rate reduction for auto debit.

Fees
By law, the total origination fee is 1.072% with the first loan disbursement after December 1, 2013, for the 2013-2014 academic year. The total origination fee is 1.072% for loans with the first loan disbursement prior to October 1, 2014, and 1.073% for loans with the first loan disbursement after October 1, 2014, for the 2014-2015 academic year. The total origination fee is 1.073% for loans with the first loan disbursement prior to October 1, 2015, and 1.068% for loans with the first loan disbursement after October 1, 2015, for the 2015-2016 academic year. The total origination fee is 1.068% for loans with the first loan disbursement prior to October 1, 2016, and 1.069% for loans with the first loan disbursement after October 1, 2016, for the 2016-2017 academic year. The total origination fee is 1.069% for loans with the first loan disbursement prior to October 1, 2017, and 1.066% for loans with the first loan disbursement after October 1, 2017, for the 2017-2018 academic year. The total origination fee is 1.066% for loans with the first loan disbursement prior to October 1, 2018, and 1.062% for loans with the first loan disbursement after October 1, 2018, for the 2018-2019 academic year. The total origination fee is 1.062% for loans with the first loan disbursement prior to October 1, 2019, and 1.059% for loans with the first loan disbursement after October 1, 2019 for the 2019-2020 academic year. The total origination fee is 1.059% for loans with the first loan disbursement prior to October 1, 2020, and 1.057% for loans with the first loan disbursement after October 1, 2020 for the 2020-2021 and 2022-2023 academic years.

Disbursement
Loan proceeds will be applied to all outstanding charges on the student account before a refund will be processed.

Application Process

Students must be enrolled at least half-time (6 credits for fall and spring semesters), in a financial aid eligible degree program and in ‘good standing’ according to the Standards of Academic Progress at Highland. Students on Financial Aid Termination are not eligible for a student loan.

More Information

Loan Servicer Contact Information

Student Loan Ombudsman Information

Update Regarding Limitation on Direct Subsidized Loan Eligibility

As of July 1, 2013, the U.S. Department of Education introduced a maximum period of time limitation (measured in academic years) on Direct Subsidized loan eligibility for first-time borrowers. A first-time borrower is a borrower who did not have an outstanding balance of principal or interest on a Direct Loan or FFEL loan on July 1, 2013. In general, a first-time borrower may not receive Direct Subsidized Loans for more than 150% of the published length of the borrower’s educational program. Only first-time borrowers on or after July 1, 2013, are subject to this new provision.

Highland Community College does not discriminate on the basis of race, color, national origin, gender or disability.