FAFSA School Code: 001146

Award Guide

2013/2014
AWARD GUIDE (pdf)
Understand your
financial aid award,
eligibility and
responsibilities

You are here: CSU, Chico | Financial Aid and Scholarship Office | Types of Aid | Loans | Types of Loans | Federal Direct Stafford Loans

Federal Direct Stafford Loans

Stafford Loans, through the Direct Loan program, are for undergraduate, credential and postbaccalaureate students enrolled at least half-time. The loans you receive will be either subsidized, unsubsidized, or a combination of both.

  • A subsidized loan is awarded on the basis of financial need. Prior to July 1, 2012, interest will not be charged before you begin repayment or during deferment periods. The federal government "subsidizes", by paying the interest during those periods. Interest subsidy during the six month grace period will be eliminated for new undergraduate loans made after July 1, 2012 and before July 1, 2014.  The repayment period will continue to begin six months after the student is no longer enrolled at least half-time, however, interest will accrue during those six months.
  • An unsubsidized loan is not awarded on the basis of need. You will be charged interest from the time the loan is disbursed until it is paid in full. You may opt to allow the interest to accumulate while you are in school or during other allowable periods of nonpayment. This interest will be added to the principal amount of your loan, and additional interest will be based on that higher amount.

Note: If your interest is capitalized, it will increase the amount you have to repay. You can choose to pay the interest as it accrues; if so, you will repay less in the long run. View Loan Term and Financial Management Information for explanation of loan terms.

See Stafford Loan Limits for loan eligibility. You may apply for additional loans above the amount you have been offered if you have not reached your annual loan eligibility and cost of attendance.

See Federal Direct PLUS Loans for information on Parent Loans for Undergraduate Students (PLUS Loans) and Graduate PLUS Loans for master's degree students.

Interest Rates and Processing Fees

Interest rates for both Direct Stafford and PLUS loans are fixed.

2012-2013 interest rates for new loans are:

2012-2013 interest rates for new loans are:
Direct Stafford Loan Subsidized (with in school deferment) fixed 3.4%*
Unsubsidized (in school and repayment) fixed 6.8%*
Direct PLUS Loan
Direct Graduate PLUS Loan		   fixed 7.9%*

Interest rates are adjusted by Congress for each academic year, and begin July 1 each year. Current Direct Loan interest rates are available from the Department of Education.

*In 2012-2013, loan origination fees will be deducted by the federal processor as follows:

  • Direct Stafford Loans: 1 percent origination fee
  • Direct PLUS and Graduate PLUS: 4.0 percent origination fee

Back to Top

Past Interest Rates and Processing Fees

Loans issued prior to July 1, 2006 carry a variable rate, adjusted annually in July, and will not exceed 8.25 percent for Direct Stafford Loans, and 9 percent for Direct PLUS Loans. Interest rates for Direct Consolidation Loans are fixed.

Back to Top

Stafford Loan Limits

Loan amounts for new first-year students and transfer students are initially estimated at the grade level you provided on your FAFSA. Transfer students may be reduced later to the amount for the first-year grade level, until all units earned at previous institutions are reflected in your CSU, Chico permanent record in the Student Records Office. Transfer students may submit a Federal Direct Loan Application to request additional loan funds that will be processed after your accurate grade level has been determined.

Loan amounts for continuing students will be estimated at the current grade level at the time of awarding. Undergraduate students may progress a grade level after grades are posted at the end of a semester. If you expect to progress as a postbaccalaureate student, your initial loan may be estimated at the fourth-year undergraduate level until we can determine your graduate classification. Continuing students may submit a Federal Direct Loan Application to request additional loan funds that will be processed after your accurate grade level has been determined.

Loan amounts for graduating seniors enrolled for one semester only:
- enrolled in fewer than 15 units, loans are prorated down, based on units
- enrolled in more than 15 units, loans are prorated up based on units

First-time Direct Stafford Subsidized Loan borrowers (on or after July 1, 2013) will have a time limitation for subsidized loan eligibility.  In general, the maximum period of time (measured in academic years) that these students can receive a Direct Subsidized Loans is 150% of the published length of their program.  Once a student reaches the Subsidized Loan time limitation, he or she may be eligible for Unsubsidized Stafford Loans only.  Click here for detailed information on calculating Subsidized Loan time limitations.

2012-2013 Direct Stafford Loans for Students
Dependent Undergraduate or PBAC Annual Limit* Aggregate Limit**
Sub & Unsub Add'l Unsub Annual Total
First Year (0-29.9 units) $3,500 $2,000 $5,500 $31,000 (no more than $23,000 of which can be subsidized
Second Year (30-59.9 units) $4,500 $2,000 $6,500
Third Year + (60+ units), CCRED CRED, PBAC, QLGRAD programs $5,500 $2,000 $7,500
Independent Undergraduate or PBAC Annual Limit* Aggregate Limit**
Sub & Unsub Add'l Unsub Annual Total
First Year (0-29.9 units) $3,500 $6,000 $9,500 $57,500 total (no more than $23,000 of which can be subsidized)
Second Year (30-59.9 units) $4,500 $6,000 $10,500
Third Year + (60+ units), PBAC, CCRED, CRED, QLGRAD programs $5,500 $7,000 $12,500
Independent Graduate Annual Limit* Aggregate Limit**
Unsub Annual Total
Graduate*** $20,500
$20,500 $138,500 total (undergrad & grad combined)

* Annual limit, or up to the cost of attendance, whichever is less.

**Aggregate limit, or the cumulative limit of Stafford loan allowed for degree program.  Undergraduate aggregate limits are different for dependent and independent students.  The aggregate limit for graduate students is separate from the undergraduate limit.

***Effective Fall 2012, Graduate Students will no longer be eligible for subsidized Stafford loans.  Graduate students will be eligible for unsubsidized loan only.  The annual limit for direct Stafford loans for graduate students will be $20,500.

Note:  For dependent students whose parents are unable to obtain a PLUS loan, the amount a student can borrow under the unsubsidized program is the same as for an independent student.

Back to Top

Promissory Notes

First–time borrowers of Federal Direct Stafford loans must complete and submit a master promissory note before the first loan disbursement may be released. The promissory note is your promise to repay loan funds disbursed to you. You are required to submit only one note during your academic career at CSU, Chico.

If you are required to complete and submit a promissory note, you will receive notification by e-mail, and it will appear on your To Do List in your Student Center.

Required steps when you first take out a Direct Loan:

Easy Tips

Check your Student Center “To Do List.” If either your MPN or loan entrance counseling does not clear within 3 business days, try doing it again. It is important to know that these sites are case sensitive. Also, if a number is transposed, such as when you enter identifying numbers, the checklist item will not clear and your loan will be delayed.

Back to Top

Disbursement

Loans are generally released in two disbursements, half in fall and half in spring. One-semester loans have a single disbursement. If you are applying for a loan to help cover additional expenses for one semester, as for study abroad, it is possible to arrange for a one semester loan. Contact the Financial Aid and Scholarship Office to explain your needs.

Required step when you graduate or leave CSU, Chico:

  • Loan Exit Counseling. This is Federal Student Aid Loan Servicing. IMPORTANT:  make sure you do the Exit Exam.

Back to Top

Grace Period

When you graduate, leave school, or drop below half–time enrollment, you have a six-month grace period before you must begin repayment of your Stafford loans. If you have an unsubsidized Stafford loan, interest begins accruing from the time of your first disbursement, but you may wait until six months after you leave school, or drop below half-time, to begin repaying the principal and interest. There is no grace period for PLUS Loans. However, there is a deferment option for Parent PLUS Loan borrowers who themselves return to school.  Click here for more information.

Back to Top

Repayment

Your Direct Stafford loans are managed by the Direct Loan Servicing Center. The Servicing Center will oversee your loan account until your loans are paid in full. Direct loans include subsidized and unsubsidized Stafford loans for students, Parent Loans for Undergraduate Students (PLUS loans), and Graduate PLUS loans. All loans must be repaid.

Visit Direct Loan Servicing Online for information and ease of managing your Direct Loans.

You may use your U.S. Department of Education PIN (the same PIN you use to access FAFSA on the Web) to access complete loan information at the Direct Loan Servicer Web site. You may view your balance, interest and payment history, estimate repayment, make your payments online, change your address, download deferment forms, and more.

When loan repayment begins for Stafford loans, you will have a number of repayment options from which to choose. The best repayment option is to repay your loan early. There are no penalties for prepaying all or part of your loan balance, and you benefit by establishing good credit.

Additional Contact Information

Direct Loan Servicing Center Address

Direct Loan Servicing Center
Borrower Services Department
P.O. Box 5609
Greenville, TX 75403-5609

Payment Address

U.S. Department of Education
Direct Loan Payment Center
P.O. Box 530260
Atlanta, GA 30353-0260

Back to Top