What is the difference between Subsidized and Unsubsidized Federal Stafford Loans?
Graduate students may be eligible for up to $18,500 in Federal Stafford Loans each academic year. Of this amount only $8,500 can be a Subsidized Stafford Loan. A subsidized loan is awarded based on financial need as determined by your FAFSA information. You will not be charged interest on subsidized loans before you begin repayment or during authorized deferment periods. An unsubsidized loan is not awarded on the basis of need. You are charged interest from the time the loan is disbursed until it is paid in full. You are required to complete entrance counseling if you are borrowing at Loyola for the first time, even if you completed entrance counseling at another school. Learn more about the Federal Stafford Loan here and complete your entrance counseling online here. • Are Federal Perkins Student Loans available to graduate students? Federal Perkins Loans are available to graduate students on a very limited basis. These need-based loans will be awarded to students with the highest nee
Graduate students may be eligible for up to $20,500 in Federal Stafford Loans each academic year. Of this amount only $8,500 can be a Subsidized Stafford Loan. A subsidized loan is awarded based on financial need as determined by your FAFSA information. You will not be charged interest on subsidized loans before you begin repayment or during authorized deferment periods. An unsubsidized loan is not awarded on the basis of need. You are charged interest from the time the loan is disbursed until it is paid in full. You are required to complete entrance counseling if you are borrowing at Loyola for the first time, even if you completed entrance counseling at another school. Learn more about the Federal Stafford Loan here and complete your entrance counseling online here. • How do I complete Loan Entrance Counseling? If you are borrowing for the first time at Loyola University Chicago through the Federal Stafford Loan, you must complete entrance counseling before the funds will disburse. T
• The subsidized Federal Stafford Loan is awarded based on financial need using your Free Application for Federal Student Aid (FAFSA) information. The government pays the interest while you are enrolled at least half-time, during your grace period (which begins once you drop below half-time enrollment) and during authorized deferment periods. • The unsubsidized Federal Stafford Loan is not a need based loan. You must also complete a FAFSA to determine your eligibility for this loan. You are responsible for the interest that accrues from the time the loan is disbursed until it is paid in full. Payment of accrued interest is optional while you are in school. Unpaid interest will be capitalized (added to the principal) at the end of the grace period when you begin repayment.
• A subsidized loan is awarded on the basis of financial need as determined by our office. The federal government pays the interest on these loans while students are in school at least half-time and during certain periods, such as grace and deferment. • Unsubsidized loans are awarded regardless of financial need but you will be responsible for the interest from the time the loan is disbursed until it is paid in full. You also must apply for federal financial aid to receive this loan. For both of these loans you will sign a Master Promissory Note. As long as you stay with the same lender you will not need to sign another note for any subsequent loans for up to 10 years. The Federal Student Aid Ombudsman of the Department of Education offers a free service to, assist students attending college, resolve disputes and/or problems associated with federal student loans. For more information you may contact the FSA Student Loan Ombudsman’s office at any of the following sites.
The federal government pays the interest on subsidized Federal Stafford Loans while you are enrolled at least half-time and during your six-month grace period. You are responsible for the interest on an unsubsidized loan. While you are enrolled, the interest will accrue until repayment begins. Many times, students have both subsidized and unsubsidized Stafford Loans during the same semester. Another difference is that subsidized Stafford Loans have a lower interest rate than the 6.8% rate of unsubsidized Stafford loans.
