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What is the difference between a Stafford Subsidized loan and a Stafford Unsubsidized loan?

April 26, 2017loan Stafford Subsidized Unsubsidized

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What is the difference between a Stafford Subsidized loan and a Stafford Unsubsidized loan?

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Both loans are a part of the Federal Stafford student loan program. However, a subsidized loan is a need based loan, where the federal government will pay the interest on the loan up until the loan goes into repayment (six months after graduation or once a students status is less than half- time.) On an unsubsidized loan – interest starts to accrue from the first disbursement until the loan has been paid in full, meaning the student is responsible for the interest for the life of the loan. Students can, however, elect to pay quarterly on the interest while they are in school.