William D. Ford Federal Direct Stafford Loan
?????????Commonly referred to as the Direct Stafford Loan Program, the U.S. Department of Education has created this loan program specifically for students who are accepted in a degree granting program, attending at least half-time (as defined by their degree program) at a postsecondary institution and meeting satisfactory academic progress standards as defined by the College. Providence College is responsible for determining eligibility for this program each year based on the results of your Free Application for Federal Student Aid (FAFSA) and current federal regulations. In addition, the College also collects and processes all paperw?ork on the government’s behalf for this program.
This program is an entitlement program offered by the U.S. Department of Education. Therefore, as long as you have not previously defaulted on a Direct Stafford Loan or have exceeded the maximum loan limits (see below) then you are entitled to participate in this program regardless of your level of need as defined by the FAFSA and as long as the criteria defined above are also met. Keep in mind that Direct Stafford Loans are taken out in the student’s name and there is no credit check required to qualify for this program.
Loan funds will be credited to your bill each semester minus the origination fee set by the U.S. Department of Education each fiscal year provided all appropriate online forms have been completed. Subsidized Direct Stafford Loans are need-based and do not accrue interest while the student is enrolled at least half-time. Interest will accrue for students borrowing unsubsidized Direct Stafford Loans which can be paid on a quarterly basis while the student is in school or opt to have the interest capitalize (added to the principal) and payable when they graduate or drop below half-time.
Terms & Conditions
For the 2021-2022 academic year the Direct Stafford Loan Program has a fixed 3.73% interest rate on undergraduate subsidized and unsubsidized loans. Graduate loans are now all unsubsidized and have a fixed 5.28% interest rate. Both loans have an 1.057% origination fee (valid through 10/1/22) that reduces the gross amount that appears on your billing statement. Repayment for Direct Stafford Loans begins 6 months after a student graduates or ceases attending school at least half-time. The standard repayment term is 10 years, although one can get access to alternate repayment terms (extended, graduated and income contingent repayment) by consolidating the loans. However, if you consolidate your loans, you could lose your grace period. As your graduation date approaches you will be contacted by the lenders who hold your loan to complete exit counseling and make payment arrangements.
Required Online Forms
If you have never borrowed through the Direct Stafford Loan Program at Providence College you must complete a Master Promissory Note (MPN) and Entrance Counseling (EC). Both the MPN and EC only need to be completed once during your attendance at Providence College.
In order to complete both of these requirements you will need your FSA ID. An FSA ID gives you access to Federal Student Aid’s online systems and can serve as your legal signature.
If you have been previously awarded and borrowed a Federal Direct Stafford subsidized/unsubsidized loan at Providence College you are not required to complete another EC or a MPN. The loan amount that appears in your CyberFriar Account will be automatically applied to your billing statement at the end of the add/drop period in each semester.
If you wish to decline all or part of any loan you have been offered use the Award Letter Response Form in order to communicate those changes to us.
Lastly, if you separate from the College (i.e. withdraw, transfer or graduate), you will be required to complete exit counseling.
Maximum Loan Limits
The maximum loan amount you can borrow is tied to how many credits you have satisfactorily completed at Providence College and any accepted transfer credits if you are an undergraduate dependent, undergraduate independent or graduate student. The annual borrowing limits for students are as follows: