Subsidized vs. unsubsidized loans: Which is best?

Higher interest rate for graduate and professional studentsis a federally issued educational loan for undergraduate students who demonstrate a financial need. The government pays the accrued interest on the loan while the borrower is in school, during their six-month grace period after graduating or dropping to less than half-time enrollment, and during any eligible periods of deferment.

If you qualify for both subsidized and unsubsidized loans, it makes sense to maximize the subsidized debt before turning to other options. To qualify for a subsidized loan, you must be enrolled as an undergraduate at least half time at a school that participates in the Direct Loans program, and pursue a course of study that results in a degree or certificate.

Each subsidized loan comes with an origination fee, which can also change from year to year. The current fee is 1.057%, which will be subtracted from your loan amount before the funds are sent to your school.When it’s time to pay off your subsidized loans, you can choose between several repayment plans with terms ranging from 10 to 25 years. If you can’t afford your payments, an

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