Federal Unsubsidized Loan
The unsubsidized loan is not subsidized by the federal government; interest begins to accrue from the date of disbursement and is the responsibility of the borrower. Borrowers may either pay the interest as they go or allow it to accrue and capitalize (be added to the principal) at the end of the six-month grace period following graduation.
Maximum Loan: This loan cannot exceed the lesser of $40,500 (adjusted for any academic year greater than nine months) or the cost of attendance minus other aid per academic year; $224,000 cumulative undergraduate and graduate unsubsidized borrowings.
Loan Fees: Beginning in 2012/13, 1% of the loan amount approved will be deducted from the loan proceeds at the time of disbursement. This means if you request $10,000 in unsubsidized loans, then your disbursement will be $9,900 (but your loan debt is $10,000).
Interest Rate: 6.8% Fixed Rate for all unsubsidized loans disbursed after July 1, 2006.
Grace Period: Borrowers will automatically receive six months of grace immediately following graduation or withdrawal from school. No payments are expected during the grace period. However, interest on the unsubsidized Direct Loan will continue to accrue and will be added to the principal at the end of the grace period.
Residency Forbearance: Borrowers may request residency forbearance for any years of residency training remaining. No payment of principal or interest is required during the forbearance period, however, interest continues to accrue and, unless paid by the borrower, will be capitalized at repayment.
Deferment Options: Once repayment begins, borrowers are entitled to a deferment if they meet any one of the requirements below. The borrower must request deferment on a form provided by the lender and provide documentation in support of the deferment request. For more detailed information regarding deferment requirements, see your financial aid counselor.
Note: Interest on federal unsubsidized loans continues to accrue during deferment and, unless paid by the borrower, will be capitalized at repayment.
- Periods of unemployment (cumulative 24-month limit)
- Full- or half-time study at an eligible school (no limit)
- Residency training (only those borrowers who have an unpaid balance on a Stafford loan disbursed PRIOR to 7/1/93; 2-year maximum deferment)
- Graduate Fellowship (lender must approve eligible program - no limit)
- Rehabilitation training (no limit)
- Economic Hardship - (only those borrowers who received their first Stafford Loan after July 1, 1993; borrower must meet the federal definition of hardship; 36-month limit)
- Unable to find full-time employment (36-month limit)
Repayment: Standard repayment allows 10 years excluding periods of grace, deferment and/or forbearance. Longer repayment periods may be available depending on the borrower's total debt.