Student loans that don't accumulate interest until after graduation?

I may have heard wrong, but a friend of mine had mentioned something about a student loan that didn't accumulate interest until after his graduation. Any one ever head of this?

Student loans that don't accumulate interest until after graduation?

Yes. This is called a %26quot;subsidized loan%26quot; where the government pays the interest while you are in school up until 6 months after you graduate. There are %26quot;subsidized%26quot; stafford loans and %26quot;unsubsidized%26quot; stafford loans.

Subsidized loans are awarded based on financial need. You will not be charged interest before you begin repayment or during periods of deferment. The federal government %26quot;subsidizes%26quot; (or pays) the interest during these times.

Unsubsidized loans are not awarded based on financial needs. Any eligible student can take out Unsubsidized Stafford Loans. You will be charged interest from the time the loan is disbursed, to the time the loan is repaid in full.

More help:

http://www.finaid.org/loans/studentloan....

Student loans that don't accumulate interest until after graduation?

yeah, i thought it was not until 6 months after graduation

Student loans that don't accumulate interest until after graduation?

Your friend may have been thinking about subsidized vs. unsubsidized student loans. The interest on subsidized loans is paid by the government while you're in school.

Subsidized loans are determined by need (sorry, you don't get to choose them!), and you can only get a certain amount in them each year. Most people have a combination of subsized %26amp; unsubsidized.