2012 New Federal Student Loan Changes

As of July 1, 2012, new federal regulatory changes take effect regarding the Federal Direct Subsidized and Unsubsidized Stafford Loans, along with the most recent change passed by Congress:

• Recently, Congress passed a new measure for Federal Direct Subsidized Stafford Loans disbursed on or after July 1, 2012 to have a fixed interest rate of 3.4%.
• Effective on or after July 1, 2012, new Federal Direct Loans will no longer receive the up-front federal rebate of .5 % on the origination fee, thus the origination fee will increase to 1%.
• Effective on or after July 1, 2012, with the 2012-13 award year, new Federal Direct Subsidized Stafford Loans received by undergraduate students will not qualify for interest subsidy during the six-month grace period provided to students when they are no longer enrolled at least a half-time status. Thus, with these new Subsidized Stafford loans, the undergraduate student borrower will be responsible for the interest during the six-month grace period.
• Effective on or after July 1, 2012, with the 2012-13 award year, graduate students will no longer qualify for the Federal Direct Subsidized Stafford Loan Program. Graduate students will continue to qualify for up to $20,500 per award year through the Federal Direct Unsubsidized Stafford Loan Program assuming that other eligibility requirements are met. The current fixed interest rate on Federal Direct Unsubsidized Loans is 6.8%.