Fact check: Do you know what kind of student loans you have? If you’re like many Boise State
students, you might have some vague ideas but aren’t sure of the specifics. Considering that almost
25,000 students took loans last year, that’s a lot of people unsure of their financial future.

There are some big differences between the multiple types of loans available to students attending Boise
State, including Federal Unsubsidized loans, Perkins Loans, Parent Plus Loans and private loans through
banks. According to the Boise State Financial Aid Handbook, a Federal Subsidized Stafford Loan is the
smartest option, in several ways.

First of all, Stafford Loans will save students money in interest. The interest on this type of loan is
subsidized by the government – meaning they pay the interest while in school or deferment. The
government doesn’t just waive interest; they actually pay it for you. This makes a big financial
difference compared to unsubsidized loans, which accrue interest while the student is in school, and add
it to the principle quarterly.

“I have to look up the difference between subsidized and unsubsidized every semester,” said senior
Communication major Annella Kelso. “It’s very important to me to know what is going on with my
finances and spare myself paying unnecessary interest.”

Another important detail to consider when taking loans is the interest rate. For the Federal Subsidized
Stafford Loan, it’s currently at 3.4 percent. That’s half the rate for unsubsidized loans. Boise State
students took almost 100 million dollars in loans for the 2011-2012 school year, as reported by Interim
Director of Financial Aid Diana Fairchild, which adds up to some hefty interest payments.

Students must be enrolled at least half time and prove financial need by filing the FAFSA in order to
be eligible for the Stafford Loan. This means that many dependent students must rely on their parent’s
financial information to be eligible. Dependents and independents are both granted $3,500 to $5,000
maximum per year depending on their year in school. The lifetime limits are $23,000 for dependents to
$57,000 for independents, so students can quickly pile up a mountain of debt.

“My advice to anyone taking out loans is first – borrow only what you absolutely need to take. Second,
I would advise students to check their loan balances and calculate their loan payments every year!”
Fairchild wrote in an email.

Fairchild recommends visiting the National Student Loan Date Service at www.nslds.ed.gov to view
loan totals and www.direct.ed.gov/calc to figure monthly payments. Additionally, students can get more
information about the Federal Subsidized Loans and other financial aid by reviewing the Financial Aid
Handbook available on www.boisestate.edu/financialaid.