Subsidized Stafford Student Loan Rate Increasing July 1, 2012

Date March 14, 2012

Millions of college students will see the rate double on their subsidized Stafford student loans, starting July 1st.

The rate is currently at 3.4%, but will soon jump to 6.8%, which is the same rate as the less popular unsubsidized Stafford student loans. There are alternatives, however.

Stafford Subsidized Loans are federally guaranteed loans based on financial need. Interest does not accrue on the loan while you are in school at least half time, or during any future deferment periods. The federal government “subsidizes” (or pays) the interest during these times.

Stafford Unsubsidized Loans are federally guaranteed loans that are not based on financial need. Interest accrues from the time the loan is disbursed.

If you or someone you know has Stafford Loans, but wants an alternative, or needs additional money for college, contact MCCU about our Private Student Loans. The loan features:


  • Competitive interest rates
  • No origination fees for borrowers attending degree-granting institutions
  • Save hundreds—even thousands—of dollars over traditional 15-year payment-deferred private student loans
  • Flexible repayment options—choose affordable fixed payments of $25 a month or make full interest payments to save even more
  • Smart Reward—earn 2% of your scheduled monthly payment as a reward in your Upromise account when you make payments on time while in school
  • Earn a 0.25 percentage point interest rate reduction while enrolled to make monthly payments by automatic debit[5]
  • Applying with a creditworthy cosigner may help you qualify for and/or receive a lower interest rate
  • You can apply to release your cosigner after graduating and making just 12 consecutive on-time principal and interest payments
For more information or to apply, visit our Student Loans page!



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