In order to qualify for Stafford student loans you must first fill in a FAFSA which is an application form that also allows you access to all sorts of scholarship and federal grants. This additional sums of money could in fact provide the alternative financing sources when you lack the means to pay out of the pocket. The repayment for the Stafford student loans starts six months after graduation or school withdrawal. This period during which no payment occurs, bears the name of grace period.

There are two categories of Stafford student loans, some subsidized and others unsubsidized. Based on demonstrated financial need, students can get all the interest for the loans paid by the government in the form of subsidized loans. In the case of unsubsidized Stafford student loans, the interest rate corresponding to the years of study, accrues and capitalizes to the initial debt.Most loans have the rate set at 6.8% which is considered a fixed value for most loan providers in this federal government system. In some cases, even lower rates than the standard are possible.

Perkins loans have a 5% interest rate and they are considered more advantageous than Stafford student loans. Yet, neither of these two federal loan systems will be able to cover all the undergraduate, graduate and post graduate degrees. Therefore, other sources become necessary for financing either from personal income and savings or from study-work conditions. Some families go as far as making home equity loans when their children do not qualify for stafford student loans.