10.10.08 | Direct Loan School vs. FFELP School
I’m sure most of you have no idea if your school is a Direct or FFELP school. If you do, give yourself a big pat on the back. If you don’t, no worries, you’re not alone. In fact, before this moment I’m sure many of you had never even heard those terms before. It’s important to know which bucket you fall in, but not pivotal. Usually the FAO will steer you in the right direction, but that is not always the case.
Here’s the difference. Direct Loan Schools use the Department of Education as the lender for their students. That means if you want a Stafford loan of a Plus loan (Parent or Grad) there is only once place you can go to sign your Master Promissory Note. These are referred to as direct subsidized, unsubsidized, or plus loans.
Now if your attending a FFELP school the options are wide open to you. You can go anywhere that services Stafford loans or Graduate Plus loans. Granted, in this market many private institutions are not funding federal loans, but we are.
Current rate for Graduate Plus loans is 8.5%. To apply for a graduate plus loan (click here).
