What is an unsubsidized federal loan for a college student?
Virtually all students enrolled at least half-time may borrow a Federal Stafford or Direct Loan. The Stafford/Direct and PLUS Loan programs are by far the largest of all the aid programs, making up over 55% of the total $90 billion annual aid portfolio. There are two different versions of the Stafford/Direct Loan: subsidized and unsubsidized. If you borrow, you will want to try to obtain the subsidized Stafford Loan, if possible though it is based on your demonstrated financial need. A subsidized Stafford Loan means there are no payments required until six months after the student ceases to be at least a half-time student though there are no pre-payment penalties on any federal loan. The federal government pays the interest as long as the student is in school at least “half-time” (usually six units per term for undergraduates and four units for graduate students). Interest does not accrue and payments do not begin until a six-month “grace” period transpires after the student leaves sch
