Students apply for consideration for Federal Direct Loans, Federal Perkins Loans, and UA institutional loans by completing the FAFSA.
A Federal Direct Subsidized Stafford Loan is awarded on the basis of the student's financial need and other specific eligibility requirements. The federal government does not charge interest on these loans while borrowers are enrolled at least half-time, during a six-month grace period, or during authorized periods of deferment.
A Federal Direct Unsubsidized Stafford Loan is not based on the student's financial need, but students must also meet specific eligibility requirements. Interest is charged throughout the life of the loan. The borrower may choose to pay the interest charged on the loan or allow the interest to be capitalized (added to the loan principal).
The Federal Perkins Loan is a fixed, 5% interest loan awarded on the basis of financial need demonstrated by the Free Application for Federal Student Aid (FAFSA). Students are encouraged to meet the March 1 priority application date as the funds are limited. Undergraduate students must be working on their first degree and demonstrate eligibility for the Federal Pell Grant to be considered for the Perkins loan. Repayment begins nine months after the student ceases to be enrolled at least half time.
A separate application is required for the following loans:
The Federal Graduate PLUS Loan for Graduate Students (Grad PLUS) is not based on financial need and is limited to graduate and professional level students attending at least half-time. The annual limit is equal to the student's cost of attendance, as defined by The University of Alabama, minus any other financial aid the student is receiving. Applicants are required to pass a credit check. The interest rate is fixed at 7.9%. Interested students should contact Student Financial Aid and complete the Federal Graduate PLUS Loan application. Interested students can also print a Federal Grad PLUS loan application from our Forms page.
The Federal Direct Parent Loan for Undergraduate Students (PLUS) is not based on financial need and is limited to a parent borrower for a dependent student attending at least half-time. A parent is currently defined as a person's natural or adoptive mother or father, step-parent, or legal guardian. The annual limit is equal to the student's cost of attendance, as defined by The University of Alabama, minus any other financial aid the student is receiving. Parents are required to pass a credit check. The interest is fixed at 7.9%. Interested parents should contact Student Financial Aid and complete the Undergraduate Federal PLUS Loan application. Interested parents can also print an Undergraduate Federal PLUS loan application from our Forms page.
Alternative loans are private (non-federal) loans. Unlike the previously mentioned loans, you are not considered for these loans when you complete the FAFSA. The terms vary widely as do the eligibility criteria.
You (and your co-borrower, if applicable) should carefully research the options and apply for the alternative loan that best suits your needs. Keep in mind that usually your best option is to pursue federal loans. Be sure you have applied for all of the federal loans you are eligible for before you consider private loans. If you do wish to take out a private educational loan, you need to provide any documentation requested by the sponsor of the loan and follow the application procedure that is specific to that loan.
