FAFSA Federal Aid Types 2 — Questions and Answers
Question 1: Which of the following federal loan programs requires a credit check?
- Direct Subsidized Loan
- Direct Unsubsidized Loan
- Direct PLUS Loan (Correct answer)
- Perkins Loan
Correct answer: Direct PLUS Loan
Direct PLUS Loans (both Parent PLUS and Graduate PLUS) require a credit check, and borrowers with adverse credit history may be denied.
Question 2: Who can borrow a Parent PLUS Loan?
- The student on behalf of their parents
- The biological or adoptive parent of a dependent undergraduate student (Correct answer)
- Any legal guardian of the student
- Stepparents only if they have legally adopted the student
Correct answer: The biological or adoptive parent of a dependent undergraduate student
Parent PLUS Loans can be borrowed by biological or adoptive parents of dependent undergraduate students to help pay for the student's education.
Question 3: What is the aggregate (lifetime) federal loan limit for dependent undergraduate students?
- $23,000
- $31,000 (Correct answer)
- $57,500
- $138,500
Correct answer: $31,000
Dependent undergraduate students can borrow a maximum of $31,000 in federal Direct Loans over their undergraduate career (no more than $23,000 of which can be subsidized).
Question 4: What interest rate feature applies to all federal student loans regardless of when they were taken out?
- Variable rates that adjust monthly
- Fixed interest rates set at the time of disbursement (Correct answer)
- Rates tied to the federal funds rate
- Rates set individually by each school
Correct answer: Fixed interest rates set at the time of disbursement
Federal student loans have fixed interest rates that are set by Congress and apply for the life of the loan, providing payment predictability.
Question 5: Which federal grant program is specifically for students who are training to become teachers in high-need subject areas?
- Pell Grant
- SEOG
- TEACH Grant (Correct answer)
- Iraq and Afghanistan Service Grant
Correct answer: TEACH Grant
The Teacher Education Assistance for College and Higher Education (TEACH) Grant provides up to $4,000 per year to students who plan to teach in high-need fields at schools serving low-income students.
Question 6: The Iraq and Afghanistan Service Grant is available to children of service members who died in which conflicts?
- Any U.S. military conflict
- Iraq or Afghanistan after September 11, 2001 (Correct answer)
- World War II or the Korean War
- Vietnam or Gulf War
Correct answer: Iraq or Afghanistan after September 11, 2001
The Iraq and Afghanistan Service Grant is available to students whose parent or guardian died as a result of military service in Iraq or Afghanistan after 9/11/2001.
FAFSA Federal Aid Types 2
Which of the following federal loan programs requires a credit check?