Know If Your Loans Are Subsidized or Non-Subsidized
When you need a loan for educational expenses, you can apply for a subsidized loan or an unsubsidized loan. While unsubsidized loans are granted much more often by the federal government and private banking institutions, most students would prefer to obtain a subsidized loan to save money in interest charges. Yet, students who desire approval for subsidized loans have to demonstrate financial need, which is not always easy to do. No matter what type of loans you receive, you need to be well-informed and knowledgeable about the differences between subsidized and unsubsidized loans so you will have an awareness of how your payments are applied.
Instructions
1. Inspect your financial aid award letter and determine which types of loans you are being offered. Stafford Loans are the most common and are either subsidized or unsubsidized. Your financial award letter will state the type of loans for which you qualify.
2. Choose which type of loan you want to accept. The interest on subsidized loans is paid by the government temporarily while you are in school and during the grace period after you graduate, while the interest on unsubsidized loans is charged from the day the funds are dispersed to you.
3. Inspect the statements that you receive from your lender. Even when you are not making payments, you should be receiving payments. Many times, the statement will include information that tells you what type of loan you have.
4. Call your lender and ask them what type of loan you have if you are unable to determine from your statement or you do not receive a statement. Locate your lender's contact information on a statement that you have received.
Tags: type loan, unsubsidized loans, what type, your lender, award letter