Borrowing student loans is a common practice used to fund a student’s college education. Although we recommend borrowing as a last resort, it is sometimes necessary to cover a student’s costs.
Before borrowing, it is important for both students and parents to understand interest rates as well as the terms of borrowing and repayment.
Remember: Be sure to always borrow only what you need to pay for your education. The interest on most loans starts accruing right away and you could be getting yourself into more debt than you realize.
Below are loan options students can consider when looking to borrow to fund their education.
Federal Direct Subsidized/Unsubsidized Loan Program:
Please Note: Although it is always the student’s choice of who they borrow from, we recommend that all students consider Federal Direct Subsidized and/or Unsubsidized Loan options before looking into additional loan resources. Even though they may not cover a student’s entire balance, they can reduce the amount the student needs to borrow in a private loan with a higher interest rate, which will save them money in the long run.
Undergraduate Students:
A subsidized loan is awarded on the basis of financial need. The federal government pays interest for the loan (“subsidizes” the loan) until you graduate or stop attending half-time and during authorized periods of deferment.
An unsubsidized loan is not awarded on the basis of need. You’ll be charged interest from the time the loan is disbursed until it is paid in full.
Students apply for these loans by filing the FAFSA.
Graduate Students:
An unsubsidized loan is not awarded on the basis of need. You’ll be charged interest from the time the loan is disbursed until it is paid in full.
You will begin repayment on the principle 6 months after you stop attending half time or graduate. When added to other financial aid resources, the loan amount may not exceed the cost of attendance at the time it is disbursed to the school.
Students apply for these loans by filing the FAFSA.
Federal Direct PLUS Loan Program:
Parent Borrowers:
Parents of dependent undergraduate students are eligible to borrow under the Direct PLUS Loan program for parent borrowers up to the cost of their child’s attendance minus other financial assistance. Interest is a fixed rate. Students whose parents apply for these loans are required to complete the FAFSA. Students whose parents are denied for the Parent PLUS Loan may be eligible for an additional unsubsidized loan for the academic year. Learn more and apply at studentaid.gov.
Graduate or Professional Students:
Graduate students are eligible to borrow under the Graduate PLUS Loan program up to their cost of attendance minus other financial assistance. Applicants for these loans are required to complete the FAFSA. Interest is a fixed rate. Learn more and apply at studentaid.gov.
Private/Alternative Loan Resources:
Private student loans are non-federal government loans offered by private lending institutions as an additional source of funds for higher education. Visit FASTChoice Loan Resources to view a historic list of lenders used by Stockton students. You must complete Borrowing Essentials before you are able to view the list of frequently used lenders by Stockton students.
Have questions? Visit stockton.edu/contactfinaid to email or schedule a phone call with our office.