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By accepting the Stafford loan on the award letter, you are accepting the maximum subsidized and unsubsidized Federal Stafford loan amount unless you indicate on the letter that you wish to borrow a smaller amount of the award or funds from only the subsidized Federal Stafford Loan program. Loan amounts may change due to verification, receipt of scholarships, receipt of additional aid, or changes in the cost of attendance. Important Things to Know Loan Fees: Most lenders charge up to a 1.5% origination fee on all Stafford Loans. In addition, some guarantors charge up to a 1% default fee. The lender and guarantor deduct this amount before you receive your loan money. Multiple disbursements: Regulations require multiple disbursements of student loans. You will get half of your loan during the fall semester and the second half of your loan during the spring semester. Enrollment level required: You must be enrolled for at least six credit hours (5 for graduate students) to receive loans. If you drop below this, you will not be eligible for any future disbursements. Right to Cancel loans: If you decide to cancel your loan, it is best to do so prior to the loan being disbursed. However, you do have 14 days to cancel all or a portion of your loan after it has been disbursed. Servicers: Although you are borrowing from a lender, many lenders contract with other agencies to collect the loans. Servicers will be the ones that you will be working with during repayment of your loan. Lenders may also sell your loans to other organizations, so it is very important to review materials that you receive from your lender or servicer. Consolidation: When you begin repayment on your student loans, you may have the option to consolidate all of your federal loans into one loan and extend your repayment period. Many agencies will be contacting you regarding consolidation. If you are eligible for consolidation, please remember that your lender can consolidate your loan. Select the agency or lender that you want to consolidate your loan carefully. If you have received excellent customer service from your lender, you may want to request consolidation through the lender. Additional information about consolidation may be obtained from your lender or on the Radford University Financial Aid website. Returning Borrowers at Radford University Returning students who have previously borrowed from the Federal Stafford Loan program while at Radford need only to complete the award letter. Your loan will be processed with your previous lender at Radford University unless our office receives a written statement requesting a change to a new lender and a new completed Master Promissory Note. New Borrowers at Radford University New borrowers include students who may have borrowed at other institutions previously, but have never borrowed Federal Stafford Loan funds while attending Radford University. If you decide to borrow a Federal Stafford Loan, there are several steps you need to take as a new borrower at Radford University: Step One: Complete the Stafford Loan Entrance Interview online at www.radford.edu/~finaid . RU will be notified by email once you have completed the entrance interview. However, please print off and keep the confirmation page for your records. Step Two: Choose the lending institution from which you wish to borrow during your attendance at RU. If you have borrowed previously, please stay with the same lender. If you would like to see a list of lenders that RU students have borrowed through in the past, please visit this site: http://finaid.asp.radford.edu/fstaf.htm . Write the lender from which you wish to borrow on the Federal Stafford Loan Master Promissory Note that is enclosed. Please provide the lender’s complete mailing address. Step Three: Complete the enclosed Federal Stafford Loan Master Promissory Note and return it to Radford University with your award letter. Please do not leave any question blank. Please make sure your lender is clearly indicated on the MPN and be sure your two references are complete. The two references must have different mailing addresses. You must complete all three steps and complete verification (if additional documents were requested) before Radford University will be able to process your Stafford Loan. Federal Stafford Loans The increased demand for Radford University’s financial aid funds has made it necessary, in many cases, to recommend alternative sources of assistance. If your award notification letter contains a reference to a Federal Stafford Loan amount for the 2008-2009 academic year, it merely indicates your ELIGIBILITY TO APPLY for a loan. There are two types of Stafford Loans. A subsidized Stafford Loan will be offered if you are eligible for some form of need based aid. The federal government will pay the interest for the student while the student is enrolled in school at least half-time and through a six-month grace period. If you are not eligible for all or some of a subsidized Stafford Loan, you will be offered an unsubsidized Stafford Loan. Unsubsidized means that you must begin interest payments on the Federal Stafford Loan immediately or capitalize (add to the principal amount) the interest. For Stafford Loans first disbursed on or after July 1, 2006, the interest rate for subsidized loans is fixed at 6.8%. The fixed rate will be reduced yearly through th June 30 , 2012. Principal and interest payments begin six months after graduation or ceasing at least half-time enrollment. Dependent Students Independent Students Freshmen (0-25 hours completed )* $5,500 $9,500 (At least $6,000 unsubsidized)** Sophomore (26-55 hours completed)* $6,500 $10,500 (At least $6,000 must be unsubsidized)** Junior/Senior (56 or more hours $7,500 $12,500 (At least $7,000 must be unsubsidized)** completed)* Graduate Students $20,500 or your Cost of Education which ever is LESS (At least $12,000 must be unsubisidzed) *If you will finish your program of study in less than an academic year, the amounts that you will be eligible to borrow may be less than those above. **Limits also apply to those dependent students whose parents are denied a PLUS Loan.
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