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

Office of Financial Aid & Scholarships

1183 - University Center
4901 Evergreen Road
Dearborn, MI 48128
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