Did you know that any student who fills out a FAFSA—no matter how wealthy—can take a federal “unsubsidized” loan. The key word here is “unsubsidized”.
The government only awards “subsidized” loans to students whose FAFSA indicates they need aid to attend their college. The key word here is “need”, which is determined by their wealth.
What is an 'unsubsidized' loan?
Here’s a quick summary of Direct Unsubsidized Loans:
- Direct Unsubsidized Loans are available to undergraduate and graduate students; there is no requirement to demonstrate financial need.
- Your school determines the amount you can borrow based on your cost of attendance and other financial aid you receive.
- You are responsible for paying the interest on a Direct Unsubsidized Loan during all periods.
- You must be enrolled at least half-time at a school that participates in the Direct Loan Program.
- Graduate or Professional Students annual loan limit is $20,500 (unsubsidized only).
- Graduate and professional students enrolled in certain health profession programs may receive additional Direct Unsubsidized Loan amounts each academic year.