Federal Family Education Loan Program

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There are many universities across the US that help graduate students to get loans to pay for their studies. The government has also instituted federal loan programs that the universities can help their students get. One such university is Santa Clara University.The Federal Family Education Loan Program (FFELP) is also known as Stafford Loan Program and it is supported by the government. It was set up to meet the cost of education of graduate students and law students. Santa Clara University, in partnership with Bank of America and Edfund, has the program. Under this program the university acts as the initial lender, Edfund is the guaranteeing agency, while the Bank of America gives out the loans or purchases them.Under the Stafford Loan program, a student can go for two types of loans.Subsidized loan:
In this type of loan, the federal government pays the interest on the loans while the borrower is still in school at least half time and during grace periods and deferments. The borrower has to prove that he requires financial help in order to be eligible for a subsidized loan.Unsubsidized Loan:
The federal government does not pay the interest on these loans while the borrower is in school, in a grace period or in deferment. Immaterial of the financial status of the student, this loan can be availed.The maximum loan amount that can be borrowed during a year of graduate study is $18,500. All FFELP loans have an origination fee of 3 percent which is deducted proportionately when the loan is being disbursed. The federal government uses this fee to reduce the cost of supporting these low interest loans.First time borrowers are required to complete an entrance counseling session online before the money can be credited to the tuition account. Once the entrance counseling and promissory notes requirements have been completed, the loan amount will be credited into the borrower’s account.