Do you have all of the money you need to start your college education and finish it? Did you know that 66 percent of all college students don’t have all the money they need to finish? Most students apply for undergraduate student loans in order to continue their college education.

If you have to take out a loan, the easiest and cheapest loans to apply for are the federal Stafford loans. There are two types of Stafford loans for undergraduates, the subsidized and the unsubsidized. You have to prove you have a financial need in order to receive the subsidized loan, while that isn’t necessary on the unsubsidized loan.

According to staffordloan.com being a US citizen or permanent resident, being able to show high school completion or a GED test, attending an approved university at least half-time, having no deferments on any outstanding federal loans and possessing a FAFSA pin number are all requirements for a student to apply for a subsidized Stafford loan. He must also be able to show he has a financial need.

There are several benefits of the subsidized Stafford loan. You don’t start repaying the loan until six months after you finish school, and there is no interest incurred while you are still in school. They are low interest loans and you don’t have to have a credit check to be accepted.

The unsubsidized Stafford loans are different from the subsidized loans in three important ways. Interest is charged monthly immediately when the money is released, they have higher fixed interest rates and you don’t have to prove you have a financial need to receive one.

Did you know that you can apply for $2, 000 more with an unsubsidized Stafford loan than you can with a subsidized one? Since interest accrues every month on the unsubsidized loan while you are still in school, it will be necessary to choose between these two options. Either pay off the interest you are charged every month while you are going to college, or have it added to the loan principle when you begin to repay it. The disadvantage to the second option is that you will pay more in interest.

When you run into financial problems while you are in college, do everything you can to get free money. Once you have exhausted all of the resources for free money, apply for a subsidized or unsubsidized federal Stafford loan. The type of undergraduate student loans you choose will depend mostly on your financial condition.

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