Subsidized loan

Description

Subsidized loan

Subsidized loans are typically federal student loans. For all subsidized federal student loans, the U.S. Department of Education subsidizes (pays the interest on) your loan while you are in school and during periods of deferment, such as during military service. Subsidized loans are available for eligible students who demonstrate financial need. You will be notified by your school if you qualify for a subsidized loan, after you complete the Free Application for Federal Student Aid (FAFSA).

Private student loans are typically unsubsidized and you can expect to pay all the interest that accrues, including interest that is charged while you are in school. The interest will be piling up while you are in school for you to pay back after you finish school.