Q: Do student loans charge interest? Does the government pay student loan interest?

A: Yes, all student loans come with interest charges and this is why you need to be careful about the type of student loans you accept.

Federal student loans such as the Perkins, Stafford, and PLUS programs come with fixed interest rates. While private student loans that are offered by banks come with variable interest rates.

Private loans can be OK, but you should not use them to fund your entire education cost. Before you accept a student loan, contact your Financial Aid Office and learn about all of your federal student aid options.

Also keep in mind that all student loans need to be paid back with the interest.

Moreover, student loans cannot be discharged in bankruptcy. So whatever you borrow, you will need to repay. This is true even if you do not graduate or cannot find a job in you chosen profession.

And because you normally do not begin student loan repayment until after you leave school, it is possible that you will have several years of accrued (built up) interest when repayment begins.

This is why it is important to educate yourself about student loans and borrow very carefully.

Government Subsidized Interest: Depending on your dependency status and level of financial need, you may qualify for a Subsidized Stafford Loan.

These subsidized loans are good because the government will subsidize (pay) all of the interest that accrues (builds up) on your loan. This can save you a lot of money if you qualify.

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