How it works: These are the primary loans from the federal government, and they can be subsidized (financial need must be demonstrated) or unsubsidized (need is not necessary). If a loan is subsidized, the federal government pays the interest during school, but the student must begin paying back the loan and interest beginning six months after graduation. If the loan is unsubsidized, the student must pay interest as soon as the loan is disbursed; there is no grace period.

There are two types of Staffords: Federal Family Education loans (FFEL Staffords) and Direct Stafford loans. Interest rates on either loan are lower than a private student loan but higher than a Perkins loan. The interest rates are variable and adjusted every July 1. The interest is currently capped at 6.8 percent for loans disbursed after July 1, 2006.

Lender/payback: Direct Stafford loans are originated by the U.S. Department of Education. If your school does not participate in the direct loan program, the money comes from a bank, credit union or other lender that is part of the FFEL program.

You can take from 10 to 25 years to repay either type of loan.