Difference Between Subsidized and Unsubsidized Loans
Subsidized loans:
- Are awarded on the basis of financial need
- Have no interest that accrues on the loan during half-time enrollment and during authorized periods of deferment
- Beginning in 2021-2022, subsidized loans have an interest rate of 3.73% (restricted to undergraduates and are not available to graduate students)
- Subsidized Loans are no longer available to graduate and professional students
Unsubsidized loans:
- Are not awarded on the basis of financial need
- Have interest that accrues during half-time enrollment and during authorized periods of deferment
- Do not require payment on interest but students will receive a quarterly statement showing the amount of interest during each quarter. It is recommended that students pay all or at least part of their quarterly interest
- Have an interest rate of 3.73% for undergraduates (same as subsidized loan) and 5.28% for graduate students