Borrowing: Student Loans
Student loans are a convenient way to pay for your education. With any type of loan, you sign a promissory note. This is a legal document that lays out the terms of the loan and requires your signature. By signing, you indicate that you understand the terms and agree to repay the loan. Most of these signatures are now done online. You may sign for the Stafford or PLUS loan on the US Department of Education website StudentLoans.gov. You may sign for the Perkins loan through MyUW. More information about your loans is available on MyUW under the heading My financial aid status.
The most common student loan is the Stafford. The University of Washington is a direct lender. This means you don’t have to go to a bank, you will get the funds directly through the University of Washington. Your annual loan will be split between the 3 quarters and is applied to your student account. It will go towards tuition unless other funds are available to pay your account.
There are two types of Stafford loans – subsidized and unsubsidized. Interest is charged on both.
- fixed interest rate
- government pays the interest on the loan while you are in school and during any grace period
- government does not subsidize the interest (you will receive a notification regarding the interest. It is important that you read this notification when you receive it. You have the option of paying the interest while still a student or adding it to the loan principle amount which is the default arrangement. Remember, the interest rate is set by Congress and may change.)
The Perkins loan is provided to students with exceptional need. The interest rate is fixed at 5% and does not vary from year to year.
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