Stafford Loans are among the most popular and available of education loans. If you're a graduate or undergraduate student enrolled in an eligible program of study on at least a half-time basis, you can apply for a Stafford Loan. Two types of Stafford Loans are available--subsidized and unsubsidized.

With a subsidized Stafford Loan, the federal government pays the interest on the loan while you're in school, for six months after graduation, and during any approved deferment periods. To qualify for a subsidized Stafford Loan, you must demonstrate financial need. Therefore, not everyone is eligible. Your financial need is based on the income and asset information you supply on the federal government's financial aid application, known as the FAFSA.

With an unsubsidized Stafford Loan, you are responsible for paying the interest that accrues during the school year, in the six-month period after graduation, and during any deferment periods. Unsubsidized Stafford Loans are not based on financial need, so they can be obtained by students at all income levels.

Each loan has specific annual borrowing limits. The interest rate issued on Stafford Loans issued before July 1, 2006 is variable (adjusted each July) and is capped at 8.25 percent. The interest rate on unsubsidized Stafford Loans issued on or after July 1, 2006 is fixed at 8.25 percent, and the interest rate on subsidized Stafford Loans issued on or after July 1, 2006 is fixed as follows:

6.8 percent for loans first disbursed on or after July 1, 2006 and before July 1, 2008

6.0 percent for loans first disbursed on or after July 1, 2008 and before July 1, 2009

5.6 percent for loans first disbursed on or after July 1, 2009 and before July 1, 2010

4.5 percent for loans first disbursed on or after July 1, 2010 and before July 1, 2011

3.4 percent for loans first disbursed on or after July 1, 2011 and before July 1, 2012

If you're interested in applying for a Stafford Loan, talk to a financial aid counselor.

One final note: Your lender for a Stafford Loan (subsidized or unsubsidized) can be either the federal government (through the Direct Loan Program) or a private lender (through the Federal Family Education Loan Program). In most cases, you don't choose your lender. Instead, the college will tell you which lender it prefers.