The federal government covers interest
on subsidized federal loans while the student is in school and at certain other times; all other interest is the responsibility of the borrower.
These include interest - free deferment
on subsidized federal loans, and access to income - driven repayment plans and federal loan forgiveness programs.
•
Subsidized federal loans accrue interest while you're in school and during your six - month grace period after leaving school, but the government pays the interest so it won't affect the total amount you owe at repayment.
The federal government will pay interest on
subsidized federal loans while the student is in school at least half - time, but all other student loans have that interest added to the total repayment amount.
•
Subsidized federal loans accrue interest while you're in school and during your six - month grace period after leaving school, but the government pays the interest so it won't affect the total amount you owe at repayment.
Examples of these are the following: federal loan forgiveness programs, interest - free deferment
on subsidized federal loans, and access to income - driven repayment plans.
If you qualify for
a subsidized federal loan, the government will even help cover your interest charges.
Note that student loan deferment, unlike forbearance, usually stops interest from growing on
subsidized federal loans.
Subsidized federal loans are geared towards students with the greatest financial need.
The only time you won't have to pay interest is if you use a deferment on
a subsidized federal loan.
For
subsidized federal loans, no.
If you have
subsidized federal loans, the government will pay the interest on these loans and your principal will not grow while you are a student.
For example, a recently graduated professional might have a package of debt that includes private loans,
subsidized federal loans and unsubsidized federal loans.
While you're in college, if you've got private loans or un
subsidized federal loans, your loans accrue interest (this isn't the case for subsidized federal loans).
If you have
a subsidized federal loan, the government will pay the interest during the deferment period, but not during forbearance.
The limits on how much money can be borrowed are smaller on
subsidized federal loans than on unsubsidized federal loans.
For
subsidized federal loans, the government pays the interest during a deferment.
First of all, if you had
subsidized federal loans (the kind where the government pays your loan interest for you when you're in school), for the first three years that you're on the Pay As You Earn plan, the government will continue providing an interest subsidy.
Finally, interest rates on
subsidized federal loans are currently low and are fixed for the life of the loan, making them a relatively cheap borrowing option.