There are two types of Federal Stafford Loans available: subsidized and unsubsidized. Eligibility for subsidized Federal Stafford Loans is based on financial need, and the federal government pays the interest on your behalf while you are enrolled at least half time, during your grace period, and authorized deferment periods. Eligibility for unsubsidized Federal Stafford Loans is not based on financial need, but you are responsible for paying interest at all times. You may pay this interest while in school, or you can allow it to accrue and capitalize and it will be added to your principal balance to be paid off with the rest of your loan when you stop attending on at least a half-time basis.

Eligibility for subsidized loans is based on financial need, as determined by the federal-need analysis process. As the name implies, the federal government pays the interest while you are still in school as at least a half-time student, throughout the six-month grace period and during periods of deferment.

Eligibility for unsubsidized loans is not based on your financial need and you are responsible for the interest from the date the funds are disbursed.

For both subsidized and unsubsidized loans, the financial aid administrator at your college determines the amount for which you are eligible.

The Federal Perkins Loan has a low interest rate and a longer grace period than the other educational loans, and allows you to borrow up to $4,000 (undergraduate study) or $6,000 (graduate study) annually. This loan is available to undergraduate and graduate student who demonstrate exceptional financial need, and must be repaid to the school with the low interest rate of five percent. Repayment begins nine months after you’ve graduated or dropped below half-time enrollment status. The minimum monthly payment is $40 per month. Apply for the Federal Perkins Loan by completing your Free Application for Federal Student Aid (FAFSA). Your college is the lender for the loan, so you will be asked to sign a promissory note and will receive the loan funds from your college.

In some instances, you may be eligible to postpone your loan payment by receiving a deferment. During a period of deferment the federal government will pay the interest on your loan.

A Federal Perkins Loan may be cancelled in part or whole under certain conditions. Loan cancellation, forgiveness, or discharge is granted by the U.S. Department of Education.

You can receive both a Federal Perkins and a Federal Stafford loan in the same academic year, provided you meet all eligibility requirements.

The college you attend may participate in either the Federal Family Education Loan Program (FFELP) or the William D. Ford Federal Direct Loan Program (Federal Direct Loans). Both programs have the same general terms, conditions, interest rates, benefits and loan amounts. The main difference between them is that the government funds the Federal Direct Loans, and private lending institutions fund the FFELP. Although some colleges offer both, you may only borrow under one program during an enrollment period. Check with the college to find out through which program you may be borrowing and what needs to be done to apply for a loan.

Perkins Loan Vs Stafford Loan

A Federal Perkins loan is a low interest (5%) loan for undergraduate and graduate students with “exceptional” financial need. The U.S. Department of Education provides a programmed amount of funding to the school. In turn, the school determines which students have the greatest need. The school combines federal funds with some of its own funds for loans to qualifying students.

Subsidized Stafford loans are need-based, and the government pays the interest on these loans while you are in school, during a six-month grace period immediately preceding repayment, and during authorized deferment.

Perkins loan has the lowest interest rate. However, you don’t need to choose between the two loans. If you are given a Perkins by the school, you can still combine that with a Stafford loan.

The only difference is that the perkins loan has a lower interest rate. They are both subsidized loans and both have a 6 month grace period after graduation.

Perkins loan has the lowest interest rate. bUT I found interesting information about your answer, college loans, scholarships, college grants & partime works here. http://all-student-loan-consolidation.blogspot.com/2007/07/college-loan-consolidation.html Good luck!

I’m sorry, I don’t know about that, but somehow I was put on this aspect of Y! A. How about applying for scholarships? I swear by all that’s holy and sacred: THIS IS NOT SPAM!

I remembered this from high school – over 40 years ago. As I was walking down a hall, I overheard two teachers talking about it:

Do a search for Lovejoy’s Guide

OR Robert Leider.

Thank you for asking your question. I enjoyed taking the time to answer your question. You did a great job – not only for your information, but for every other person interested in reading my answer. Thanks to everyone for reading my answer.

I wish you well!

VTY,

Ron Berue

Yes, that’s my real last name.

Need more info to answer

Good replies, just what I was looking for.