March 22, 2007

Subsidized Loans Vs. Unsubsidized Loans

Posted in FAFSA, Graduate Students, Misc, Saving for College, Stafford Loans, The Financial Aid Process at 8:34 AM by kpops

As you now already now, Stafford Loans are Federal Aid awarded to students based on financial need. These are loans and not grants so they do need to be repayed to your lender, which of course means they accrue interest. What most students dont know is that there are two types of Stafford Loans, Unsubsidized Loans and Subsidized Loans. Subsidized Loans are awarded to the students with a greater financial need for the loan. The government pays interest on these loans while the student is in school. This means that the student does not begin accruing any interest on the loans until 6 months after graduation.

Unsubsidized Stafford Loans begin accruing interest from the date the loan is disbursed to the school. Although repayment of Stafford Loans is deferred until the student graduates from school you do still have an option of making interest only payments while in school. This arrangement can be made directly with your lender in order to save on interest paid over the long run. If you chose to defer your interest until you graduate the interest will be capitalized. This means that the interest will be added to the principal balance of the loan and you will then continue to accrue interest on the total balance.

The Student Loan Network: Stafford Federal Student
, Parent PLUS Loans, Student Loan
, Private Student Loans

New EFC calculator from the Dept. of Education

Posted in FAFSA, Student Loan News at 7:55 AM by Joe From Boston

Wow, here’s a cool new tool available starting April 1st from the Department of Education.  FAFSA4caster will allow students to receive and estimated EFC (expected family contribution) – which is something we get questions about all the time!  I highly recommend you check this new tool out once it comes online.  The whole article is available through NAFSAA.  Information for accessing the tool is available at the bottom of this article:

Federal Student Aid is pleased to announce the release of FAFSA4caster, a new Federal Student Aid Web product designed to assist high school juniors and their families plan for education beyond high school. Beginning April 1, 2007, students can receive an estimated Expected Family Contribution (EFC) by entering their information into the FAFSA4caster tool, a customized version of the Free Application for Federal Student Aid (FAFSA). FAFSA4caster also provides guidance on next steps for applying for admission, applying for Federal student financial aid, and paying for education beyond high school.

FAFSA4caster Benefits

FAFSA4caster is a companion piece to the official FAFSA on the Web. The free FAFSA4caster tool will assist high school juniors and their families in the following ways:

  • Instantly calculate an estimated EFC
  • Inform the student of potential Federal Pell Grant (Pell Grant) eligibility
  • Reduce the time needed to complete the FAFSA when the student applies as a senior

FAFSA4caster Access

Students and families interested in assessing their eligibility for Federal student financial aid can access FAFSA4caster by visiting The links for FAFSA4caster are located in the lower right corner of this page.