What is the difference between subsidized and unsubsidized loans?

What is the difference between unsubsidized and subsidized student loans?

  • Answer:

    Subsidized means it is need-based and therefore the govenment pays the interest while you are in school, during a six-month grace period after graduation or otherwise separating from school, and during authorized deferment. Unsubsidized is not need-based and therefore the government charges you interest starting from your first receipt of money.

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