A subsidized Stafford Loan is a need-based student loan for which interest is paid by the federal government during the in-school, grace and deferment periods. Also called Direct Subsidized Loan.
An unsubsidized Stafford Loan is a student loan that is not based on need, and for which interest is not paid by the federal government. Borrowers are responsible for all interest accrued on unsubsidized loans. Also called the Direct Unsubsidized Loan.
Learn more about Direct Loans