Can you borrow both subsidized and unsubsidized loans?

Dependent students can borrow a total of $31,000 in combined unsubsidized and subsidized loans, while independent undergraduate students can borrow up to $57,500 total. Graduate or professional students can borrow a total of $138,500 in Direct Unsubsidized Loans, including any undergraduate loans.

Can you take out both subsidized and unsubsidized loans?

First-year undergraduate students can borrow a combined $5,500 in subsidized and unsubsidized loans if they're still financially dependent on their parents. Only $3,500 of that amount may be subsidized loans.

Can student loans can be subsidized or unsubsidized?

Direct Subsidized Loans are available only to undergraduate students who have financial need. Direct Unsubsidized Loans are available to both undergraduates and graduate or professional degree students. You are not required to show financial need to receive a Direct Unsubsidized Loan.

Do both subsidized and unsubsidized loans have interest?

If your loans are subsidized, you are not responsible for paying the interest that accrues while you're in school. If your loans are unsubsidized, you're responsible for all the interest that accrues, even while you're in school. Learn about the differences between subsidized and unsubsidized loans.

Is there a limit on subsidized and unsubsidized loans?

Subsidized and Unsubsidized Aggregate Loan Limit

$138,500 for graduate or professional students - no more than $65,000 of this amount may be in subsidized loans (the graduate aggregate limit includes all federal loans received for undergraduate study).

Differences between Subsidized and Unsubsidized Loans

Can you run out of subsidized loans?

Does aid run out? Yes, in the sense that there are annual limits on how much you can borrow or qualify for in Pell Grant funding. Federal loan limits are based on your enrollment year, dependency status, and type of loan. Colleges have a limited pool of money, so filling out the FAFSA earlier is better.

What is the maximum unsubsidized loan amount?

The maximum amount you can borrow each academic year in Direct Unsubsidized Loans ranges from $5,500 to $12,500 for undergraduates, depending on your year in school and your dependency status.

Is it better to pay off unsubsidized or subsidized loans first?

Which Student Loans Should You Pay First: Subsidized or Unsubsidized? It's a good idea to start paying back unsubsidized student loans first, since you're more likely to have a higher balance that accrues interest much faster.

Is Pell Grant subsidized or unsubsidized?

While the Pell Grant is the primary subsidy for higher education, the federal government also funds several smaller aid programs.

What are the disadvantages of a subsidized student loan?

How do subsidized and unsubsidized student loans work?

Subsidized Loans do not accrue interest while you are in school at least half-time or during deferment periods. Unsubsidized Loans are loans for both undergraduate and graduate students that are not based on financial need.

Can unsubsidized loans be forgiven?

You'll also be eligible for student loan forgiveness on any remaining balance after the repayment period ends. This is usually after 20–25 years. Both direct subsidized and unsubsidized loans are eligible for any of the four IDR plans.

How many subsidized loans can I get?

First-time borrowers may not receive subsidized loans for more than 150% of the length of program of study. For example, if you are enrolled in a 2-year associate degree program, the maximum period for which you can receive a Direct Subsidized Loan is 3 years (150% of 2 years = 3 years).

Do both subsidized and unsubsidized loans qualify for PSLF?

Which loans are eligible for loan forgiveness? Only Federal Direct Loan Program loans that are not in default are eligible for PSLF (ie - Direct Subsidized Loans, Direct Unsubsidized Loans, Direct PLUS Loans, Direct Consolidation Loans).

Should I accept both subsidized and unsubsidized?

Given the option, you should accept a Direct Subsidized Loan first. Then, if you still need additional financial aid to pay for college or career school, accept the Direct Unsubsidized Loan.

Why is it smart to pay off an unsubsidized loan?

In other words, the type of loan doesn't matter once the deferment period ends, but if you're a current student who is getting an early start on loan repayment, you'll want to start paying your unsubsidized loans as soon as possible so you can save yourself from paying large sums in interest down the road.

Why is it better to accept a subsidized loan before an unsubsidized loan?

If you qualify, you should ideally max out subsidized loans first since the government covers a portion of the interest while you're enrolled in school, during your grace period and if your loans are in deferment.

Can I increase my unsubsidized loan?

Direct Unsubsidized Loan Fees

Fees are deducted from each loan disbursement. You can ask the college financial aid office to increase the loan amount to cover the fees, up to the annual loan limit.

Do you pay back subsidized loans?

Both subsidized and unsubsidized loans have a loan fee, which is a percentage of the total loan amount that is subtracted from each disbursement you receive. It is your responsibility to pay back the full amount you borrowed, not just the amount you received less the loan fee.

Is $20,000 in student loans a lot?

The Federal Reserve reports that the median student debt for all borrowers in 2022 was between $20,000 and $24,999. That means about half of student loan borrowers owe more than that, and half owe less.

What is the maximum Pell Grant per semester?

Federal Pell Grant

Award amounts are based on the student's level of financial need and enrollment status for each term. The maximum Pell Grant for the 2023-24 award year is $7,395. The maximum Pell Grant per term is $3,698 for Fall/$3697 for Spring.

What to do if you maxed out financial aid?

What happens to unused subsidized loans?

Your school will apply those funds to tuition and fees first. If there are funds left over, it will send you a check, which you can use for education-related expenses like housing, groceries, bills and more. In some cases, students end up with more money than they need.