Subsidized Loan
A subsidized loan is a type of loan that is offered to students or borrowers who demonstrate financial need. The loan is subsidized by the government, meaning that the government pays the interest on the loan while the borrower is in school or during the grace period. This type of loan is typically offered to students who are enrolled in college or university, and is often used to cover tuition and other educational expenses.
History of Subsidized Loans
Subsidized loans have been around since the 1950s, when the federal government began offering them to students in need. Since then, the government has continued to offer subsidized loans to students, and the program has grown to include other types of borrowers as well. In recent years, the government has also begun offering subsidized loans to borrowers who are in need of assistance with housing, medical, and other expenses.
Comparison of Subsidized and Unsubsidized Loans
| Type of Loan | Interest Rate | Grace Period |
|---|---|---|
| Subsidized | Fixed | 6 months |
| Unsubsidized | Variable | No grace period |
Summary
Subsidized loans are a type of loan offered to students or borrowers who demonstrate financial need. The loan is subsidized by the government, meaning that the government pays the interest on the loan while the borrower is in school or during the grace period. This type of loan is typically offered to students who are enrolled in college or university, and is often used to cover tuition and other educational expenses. For more information about subsidized loans, visit the U.S. Department of Education website or contact your local financial aid office.
See Also
- Unsubsidized Loan
- Federal Student Aid
- Student Loan Consolidation
- Student Loan Refinancing
- Federal Direct Loan Program
- Private Student Loans
- Parent PLUS Loan
- Perkins Loan
- Graduate PLUS Loan
- Direct Consolidation Loan
