Federal Stafford Loans are loans that are based on student financial needs and are regulated by the federal government.
The Stafford Loans are put into 3 categories:
- Subsidized
- Unsubsidized
- Additional Unsubsidized Stafford Loan
Subsidized Stafford Loan is a long-term loan with a low-interest rate. What does subsidized mean? It means that the federal government will pay the interest on the loan while you are attending school or when you as a student can request a grace period of deferment.
As for Unsubsidized Stafford Loan is also long term with a low interest rate but it is not based on the student financial needs. Generally, it is a good option for those who don't qualify for other forms of financial aids, or who still require more money on top of other forms of financial aid that they have. As this is an unsubsidized loan, you are responsible for the interest of the loans. Of course, the payments can be deferred until you complete your education.
The Additional Unsubsidized Stafford Loan is reserved for independent students and must meet several federal guidelines.