Federal Unsubsidized Loans

[bgreet]

Quick question about interest accrued to the Federal Unsubsidized loans while in school that I wasn't able to pick out from the MPN. Is the interest only added to the principle after we graduate? In essence it doesn't make a difference if I try to pay off the accrued interest now, or just prior to graduation? It seems like a good idea to minimize as much as possible to the principle but not at the cost of losing future returns on money that I can hold onto for four additional years.

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[alwaysaangel]

Quick question about interest accrued to the Federal Unsubsidized loans while in school that I wasn't able to pick out from the MPN. Is the interest only added to the principle after we graduate? In essence it doesn't make a difference if I try to pay off the accrued interest now, or just prior to graduation? It seems like a good idea to minimize as much as possible to the principle but not at the cost of losing future returns on money that I can hold onto for four additional years.

The interest capitalizes and becomes part of the principle of the loan when your grace period ends after graduation.

So yeah it makes no difference if you pay it back now or when you graduate.

 

[mshheaddoc]

Interest is added when you go into repayment. As many students defer during residency as well, this means the interest might not be deferred until you are a practicing physician. So yes you could just pay it prior to graduation or something of the like.