What are Stafford Loans?
Direct and FFEL Stafford Loans have variable interest rates (unlike Federal Perkins Loans) and are for both undergraduate and graduate students. The loans you receive will be either subsidized or unsubsidized.

* A subsidized loan is awarded on the basis of financial need. You won’t be charged any interest before you begin repayment or during deferment periods (click here for more information). The federal government “subsidizes” the interest during these periods.

* An unsubsidized loan is not awarded on the basis of need. You’ll be charged interest from the time the loan is disbursed until it’s paid in full. If you allow the interest to accrue (accumulate) while you’re in school or during other periods of nonpayment, it will be capitalized. This means the interest will be added to the principal amount of your loan, and additional interest will be based on that higher amount.
- posted by Mark Pane @ 8:09 PM