What is the difference between Subsidized and Unsubsidized loans?

What’s the difference between subsidized and unsubsidized loans?

• Subsidized Loans

  • For undergraduate students with financial need

  • The federal government pays the interest while you're:

    • Enrolled in at least 6 credits

    • In your grace period

    • In a period of deferment

  • You must make timely progress toward your degree to keep the subsidy

  • Saves you money because interest doesn’t build up during those times

• Unsubsidized Loans

  • For undergraduate and graduate students

  • Not based on financial need

  • The federal government does NOT pay the interest

  • Interest starts building right away—from the time the loan is used to pay tuition and fees

  • You can pay the interest as it accrues or let it add to your loan balance

Tip:
If you qualify for both, take subsidized loans first—they cost less over time.

If you have additional questions, please contact Student Services via live chat or email.