Stafford loans are student loans.  They are awarded to the student in the student’s name and it is the responsibility of the student to repay the loan.  There are two types of Stafford Loans – Subsidized and Unsubsidized.  Undergraduate and graduate students must be enrolled at least half time to be eligible.

A Subsidized loan is a loan in which the Federal Government subsidizes (pays) the interest for the borrower during the time that the student is enrolled in classes at least half-time and seeking a degree.  Subsidized loans are “need based” which means the student must demonstrate need by completing the FAFSA, and the results must indicate the student has “need.”  If that need is not met by scholarships and grants, the remainder of that need may be met with a Subsidized Stafford Loan.  There is a limit to the amount a student may borrow in a Subsidized Stafford Loan each year based upon their academic level (see the table below).  An origination fee may be assessed by the federal government at the time of disbursement.  Some lenders rebate all or part of the origination fee.

An Unsubsidized Loan is also a student loan; however, the government does not subsidize the interest for the student at any time.  An Unsubsidized Loan is not “need based,” which means the student is not required to have remaining “need.”  The student must complete the FAFSA, be enrolled in classes at least half time and must be degree-seeking.  An Unsubsidized Loan may be borrowed to attain the remainder of the initial eligible loan amount that was not met by the Subsidized Loan.  In some cases a student may borrow additional Unsubsidized Loan funds, especially if the student is Independent, or if a Dependent student’s parents have been denied a Parent PLUS Loan.

Students may be awarded Stafford Loans each year they complete a FAFSA and are determined to be eligible.  The student must accept or decline the loans that are offered.  Students may accept a partial amount, in writing, by making changes to the Award Notice or contacting their financial aid counselor.

To receive a Stafford Loan, the student is required to select a lender and complete a Master Promissory Note (MPN).  UNCW encourages you to borrow all your student loans with one lender to ease servicing and repayment.

Once you have determined the lender for your Stafford Loan you must review your financial aid award on SEANET and accept the loan funds.  Your initial award will include a Federal Direct Stafford Loan.  If you choose a lender other than the Direct Loan Program, DO NOT accept the Stafford Loan until it has been converted to a FFELP Stafford Loan.  UNCW receives notification when the student selects a lender other than the Direct Loan Program and makes the necessary adjustments to convert the loan funds into FFELP.  Once your award reflects the program you have selected (Direct or FFELP, if you’ve chosen another lender) you must accept the award.

The MPN only needs to be signed once.  Students must sign a Stafford MPN which is valid for all Stafford loans borrowed at UNCW with the same lender for a period of 10 years.

All Stafford loan borrowers are required to complete an entrance interview.  This Federal requirement ensures that you understand your rights and responsibilities as a student loan borrower.  The entrance interview requirement is based on the lender you have chosen for your Stafford Loan.  Complete the appropriate entrance interview requirement.

Direct Stafford Loan Entrance Interview Requirement

FFELP Stafford Loan Entrance Interview Requirement

It may be possible to cancel a portion of the Stafford Loan through service as a teacher in a designated school.  Refer to the U.S. Department of Education Student Guide for more information.

Receiving your loan funds:

After your lender has received your completed MPN, UNCW finalizes the loan process and your loan is scheduled for disbursement.  If your loan is for the full academic year, it will be disbursed in two equal disbursements – one at the beginning of fall semester and one at the beginning of spring semester.  Because you must be enrolled to receive a Federal Stafford Loan, your loan funds are credited to your student account in the UNCW Cashier’s Office.  Your loan funds first offset any outstanding charges you owe to the university for the semester.  After your charges are paid in full, a refund of any excel loan proceeds is provided to you.  If all processes are complete, this disbursement and refund process can take place during the first week of each semester.  Any incomplete paperwork or processing may delay the disbursement.

Loan Limits: