Subsidized and Unsubsidized Stafford Loans

INTEREST RATE:  6.8% fixed for the life of the loan

FEES:  up to 1% from each disbursement

APPLICATION:  Stafford Loan Processing Sheet

PROMISSORY NOTE:  www.dlenote.ed.gov

DESCRIPTION: Subsidized and Unsubsidized Stafford Loans are the primary source of financial aid for students enrolled in the College of Medicine. There are several players in the Federal Stafford Loan Program:

• THE FINANCIAL AID OFFICE approves your loan based on your FAFSA.
   
• THE UNITED STATES DEPARTMENT OF EDUCATION'S DIRECT LOAN PROGRAM will provide the money for your loan.
   
• SERVICING COMPANIES are contracted by the Department of Education to handle repayment of your loans.  The Department of Education currently has contracts with five loan servicing companies, so you will be dealing with one or more of these companies if you take out Stafford Loans:
      ACS                                            
      Great Lakes Servicing   
      Nelnet
      PHEAA (Pennsylvania Higher Education Assistance Agency)
      Sallie Mae

Your loans will be disbursed in two equal installments, the first at registration (provided you have applied in a timely manner) and the second at the beginning of the Spring Semester. A loan origination fee of up to 1% will be deducted from each disbursement.  This fee is withheld by the government to help offset the cost of the programs.

The terms and conditions of the Subsidized Stafford Loan and the Unsubsidized Stafford Loan are similar with one notable exception: the government subsidizes (or pays on your behalf) the interest on the Subsidized Stafford Loan during medical school and deferment, but not on the Unsubsidized Stafford Loan. The interest rate charged on all Stafford loans for graduate students is fixed at 6.8% for the life of the loan.

SUBSIDIZED STAFFORD LOAN: The Subsidized Stafford loan is a need-based loan. The Financial Aid Office will use your Expected Family Contribution to determine how much you are eligible to receive. The maximum amount you may borrow in Subsidized Stafford Loans is $8,500 for each academic year. The government will pay/subsidize the interest on this loan during the time that you are in medical school and in authorized periods of deferment, but you will be responsible for all interest that accrues once you enter repayment.

UNSUBSIDIZED STAFFORD LOAN: The Unsubsidized Stafford Loan is not a need-based loan. Most students apply for an Unsubsidized Stafford Loan in addition to their Subsidized Stafford Loan. Unsubsidized Stafford Loans can be used to replace the amount the Department of Education asks you to contribute to your education (your Expected Family Contribution from your FAFSA). The government does NOT pay any interest on Unsubsidized Loans. The interest will be charged to you, the borrower, throughout the life of the loan. The annual maximum you may borrow from the Unsubsidized Stafford Loan will equal your Cost of Attendance minus your other financial aid, up to the federal annual limit for your class year. Students determined ineligible for a Subsidized Stafford Loan can be approved for an Unsubsidized Stafford Loan instead.

HOW TO APPLY: First file your FAFSA, then complete the Stafford Loan Processing Sheet and return it to the Financial Aid Office. Once the Financial Aid Office determines your eligibility and processes your loan, we will send you a Financial Aid Award Letter  notifying you of your award. We ask that you contact the Financial Aid Office within two weeks of receiving your Award Letter if you would like to change any of the loan amounts listed.

You must also sign a Stafford Loan Master Promissory Note at www.dlenote.ed.gov before you can receive your initial loan through the Direct Loan Program.  A single Master Promissory Note will authorize the Department of Education to disburse multiple Stafford loans to you for up to ten years.  So you will not be required to sign a new note each year. 

You may apply for loans at any time throughout the academic year. 

University of Arkansas for Medical Sciences
College of Medicine
4301 W. Markham St., Little Rock, AR 72205

Student Admissions: (501) 686.5354 / E-mail: southtomg@uams.edu
Center for Diversity Affairs: (501) 686.7299 / E-mail: cda@uams.edu
Office of Alumni Affairs: (501) 686.6684/ E-mail: Ginny Rice
Dean's Office: (501) 686.5349
 

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