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Subsidized Loans

Subsidized Federal Stafford Loan: Know as Federal Direct Stafford - Ford Loan. Also referred to as Direct Subsidized Loan. Borrowers who demonstrate financial need can receive a subsidized FFEL or Direct Stafford Loan, which means the federal government does not charge interest on these loans while borrowers are enrolled in college at least half time, during a six month grace period, or during authorized periods of * deferment, but not during * forbearance. Subsidized Stafford Loans are awarded on the basis of financial need. Your eligibility is determined by your college's financial aid office. If you don't demonstrate financial need, or if you need to borrow more than your subsidized loan limit, you can receive an unsubsidized FFEL or Direct Stafford Loan. This means you are responsible for the interest that accumulates, the government does not pay it. Read more about Stafford Loans

Glossary For This Page
(In Alphabetical Order)

* Deferment
A period of time during repayment when the borrower, upon meeting certain criteria, is not required to make regular monthly payments. Depending upon the type of loan, the interest may or may not be paid by the government during the deferment period.

* Forbearance
A temporary postponement of * principal and * interest payments during which the borrower may only pay the interest on the loan. If the borrower chooses not to pay the interest, it will be capitalized (adding accumulated interest to the loan principal) at the end of the period.

* Interest
The cost you pay to borrow money.

* Principal
Amount owed on the loan at any given time, not including the interest.

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