Office of Financial Aid
307.532.8224
1.866.EASTWYO
(1.866.327.8996)
EWC's financial aid office determines your eligibility for a federal student loan based on information you provide on the Free Application for Federal Student Aid (FAFSA).
Stafford Loans | PLUS Loans | Interest Rates | Alternative Loans
Stafford Loans
Stafford loans are the most common source of student loan funds available for undergraduate, graduate, vocational, and professional students. There are two types: subsidized and unsubsidized.
- Subsidized Stafford loans are need-based. The federal government pays the interest on the loan while the student is enrolled in school at least half-time and during the grace period before repayment begins. Monthly payments begin six months after the student graduates, drops below half-time or withdraws from school.
To qualify for a subsidized Stafford loan, students must meet all the requirements for federal student financial aid. They also must have had their eligibility for a Pell Grant determined.
- Unsubsidized Stafford loans may be taken out by all qualified students, regardless of their income or assets. They must meet the same requirements as those for subsidized Stafford loans, except they don't have to demonstrate financial need. The unsubsidized Stafford loan plus all other financial aid cannot exceed the cost of attendance. Interest accrues from the time the loan is disbursed, and interest payments begin immediately but can be deferred. It's to the student's advantage, of course, to pay the interest while in school. This way, the debt will be the principal amount only when repayment begins.
PLUS Loan (Parent Loan for Undergraduate Students)
Parents of dependent students can take out loans to supplement their children's aid packages. The federal Parent Loan for Undergraduate Students (PLUS) lets parents borrow money to cover any costs not already covered by the student's financial aid package, up to the full cost of attendance.
PLUS loans are the financial responsibility of the parents, not the student. If the student agrees to make payments on the PLUS loan, but fails to make the payments on time, the parents will be held responsible.
If you are concerned that you might not be eligible for a PLUS loan because of bad credit, you should consider applying for a PLUS loan anyway. If you are denied a PLUS loan for credit reasons, your child becomes eligible for higher Stafford loan limits.
Interest Rates and Fees
Stafford Loans
Loans first disbursed on or after July 1, 2006 have a fixed interest rate of 6.8 percent.
Loans first disbursed on or after July 1, 1998 and prior to July 1, 2006 have a variable interest rate with a cap of 8.25 percent. The interest rate is adjusted each year on July 1 (your loan holder will notify you of interest rates changes annually). As of July 1, 2006, the variable rate is 6.54 percent during in-school, grace, and deferment periods and 7.14 percent during repayment.
PLUS
Loans first disbursed on or after July 1, 2006 have a fixed interest rate of 8.5 percent.
Loans first disbursed on or after July 1, 1998 and prior to July 1, 2006 have a variable interest rate with a cap of 9 percent. The interest rate is adjusted each year on July 1 (your loan holder will notify you of interest rates changes annually). As of July 1, 2006, the variable rate is 7.94 percent.
Alternative Loans
Private Loans, also known as Alternative Loans, help bridge the gap between the actual cost of your education and the limited amount the government allows you to borrow in its programs. Private loans are offered by private lenders and there are no federal forms to complete.
Some families turn to private loans when the federal loans don't provide enough money or when they need more flexible repayment options. For example, a parent might want to defer repayment until the student graduates, an option that is not available from the government parent loan program. (Many PLUS loan providers are starting to allow parents to defer payments on the PLUS loan while the student is in school. We recommend you check with your PLUS loan provider regarding these options prior to taking out an alternative loan.)
Lenders provide different types of private loans depending on the student's level of study.
Private loans tend to cost more than the loans offered by the Federal government, thus we recommend that you research alternative loans prior to applying for one, and only apply if you truly need one. Consult the Financial Aid Office at EWC for more information.
