 TITLE: When Do Student Loans Start Accruing Interest? CONTENT: When Do Unsubsidized Loans Accrue Interest?\n-------------------------------------------\nDirect unsubsidized loans are also student loans offered by the federal government and are available to undergraduate and graduate students regardless of financial need.\nDirect PLUS loans, often referred to as parent PLUS loans or grad PLUS loans, are another unsubsidized loan option. Parent PLUS loans are for the parents of undergraduate students, while graduate PLUS loans are for professional and graduate students.\nThe interest on both direct unsubsidized and direct PLUS loans begins the day you receive the funds. Unlike with direct subsidized loans, however, you are responsible for all interest charges on unsubsidized loans, from the moment you take out the loan until the day you pay it off.\nYou don't have to make monthly payments on direct unsubsidized loans while enrolled at least half-time or during the grace period. PLUS loan recipients also have the option to delay payments until the loan recipient graduates, is no longer a student at least half-time or leaves school.\nThat said, paying at least the interest on an unsubsidized loan before you are required to begin making monthly loan payments can save you a significant amount of money. That's because the accrued interest will be \"capitalized,\" or added to your original principal amount, once the grace period ends. At that point your loan will begin accruing interest on the new loan amount—the principal plus the capitalized interest. END