What is the difference between Direct Stafford subsidized and unsubsidized loans?
The Federal Direct Subsidized Stafford Loan is based on financial need. You will not be charged interest while you are in school at least half-time. The Federal Direct Unsubsidized Stafford Loan is not need based. It is available to students regardless of financial need. You will be charged interest from the time the loan is disbursed until it is paid in full. You will have the option of allowing the interest to accrue until you enter repayment or making a small interest payment quarterly to the Direct Loan Servicer. The amount of your subsidized and/or unsubsidized Stafford loan will depend on your grade level and be limited to your Cost of Attendance (COA).
The Direct Stafford Subsidized Loan is based on need, and the government pays the interest while you’re enrolled on at least a half-time basis. The Direct Stafford Unsubsidized Loan is not need based and is available to students regardless of financial need. While you are still in school, the interest is capitalized, or added to the principal, if the recipient chooses not to make payments upon the interest. Students may request to make interest payments while still in school.
