What’s the difference between a Federal Direct Subsidized Stafford loan and an Unsubsidized Loan?

Direct Subsidized Loans are available to undergraduate students with financial need. The Department of Education (DoE) uses a special to determine financial need. Visit this DoE webpage for more information. Once the DoE evaluates your financial need, we determine the amount you can borrow. That amount may not exceed your calculated financial need. The U.S. DoE pays the interest on your Direct Subsidized Loan during the following periods:

• while you’re in school at least half-time,
• for the first six months after you leave school (your “grace period”), and
• during deferment (when you temporarily postpone your loan payments).

Direct Unsubsidized Loans are available to undergraduate and graduate students. Additionally, Direct Unsubsidized Loans are available regardless of financial need. We determine the amount you can borrow based on your cost of attendance and other financial aid you receive. You’re responsible for paying the interest on a Direct Unsubsidized Loan:

• while you’re in school
• during grace, deferment, or forbearance periods. 

You can choose not to pay interest while you’re in school and during grace, deferment, or forbearance periods. If so, your interest will be added to the principal of your loan (this is called “capitalization.”) 

To apply for a federal student loan, complete the Free Application for Federal Student Aid (FAFSA). You can send Lesley your application by entering our Federal School Code (002160). Once we receive your FAFSA information, the Financial Aid Office will use it to determine your eligibility for federal aid. You will automatically be awarded the maximum you are eligible to receive for the academic year.