The three types of loans available under the DL program are Subsidized, Unsubsidized, and Parent loans for undergraduate students (PLUS).
The subsidized and unsubsidized loan programs are available to both dependent and independent students. Eligibility for the subsidized Stafford loan is based on financial need while eligibility for the unsubsidized loan is not based on financial need.
If your financial need is not great enough, you may not be eligible for the entire amount of the subsidized Stafford loan. In this situation the amount not received in the subsidized Stafford loan may be received in the unsubsidized Stafford loan program.
The PLUS loan program is available to parents of dependent students. An eligible parent borrower for a federal PLUS loan is a student's natural mother or father, adoptive parent or legal guardian. An eligible parent borrower must meet the same citizenship or residency requirements that a student borrower is required to meet. The government does not provide an in-school interest subsidy on this loan.
Repayment on the Subsidized and the Unsubsidized loan begins six months after the student ceases to be enrolled at least half-time. The minimum monthly payment is $50 per loan. The interest rate on both loans is fixed at 4.66%.
Repayment on the PLUS loan begins 60 days after the first disbursement has been made. The interest rate is fixed at 7.21%.
In all federal loan programs, a loan origination fee is charged. The origination fee for the subsidized and unsubsidized loan program is 1.073% and the origination fee for the PLUS loan is 4.292%.