Subsidized vs. Unsubsidized Loans

The differences between Direct Subsidized and Unsubsidized Loans
Direct Subsidized Loan	Direct Unsubsidized Loan
Based on financial need	Not based on financial need
The federal government pays the interest on the loan while you are enrolled in school at least half-time.	Interest begins accumulating as soon as funds are disbursed until the loan is paid in full. Accrued interest will be added to the balance of the loan. (You are not required to pay the interest while you are in school, but we recommend that you do.)
Undergraduate student fixed interest rates: 5.05 percent for loans disbursed on/after July 1, 2018	Undergraduate student fixed interest rates: 5.05 percent for loans disbursed on/after July 1, 2018
*Graduate students are not eligible to receive Direct Subsidized Loans.	Graduate student fixed interest rates: 6.6 percent for loans disbursed on/after July 1, 2018
Origination fees: 1.066 percent for loans first disbursed on/after Oct 1, 2017 and before Oct 1, 2018 1.062 percent for loans first disbursed on/after Oct 1, 2018 and before Oct 1, 2019	Origination fees: 1.066 percent for loans first disbursed on/after Oct 1, 2017 and before Oct 1, 2018 1.062 percent for loans first disbursed on/after Oct 1, 2018 and before Oct 1, 2019