For an undergraduate student in the U.S., Stafford loans are offered to students and may contain a portion that is subsidized and another portion that is not, both in a single year.

Can the unsubsidized loan be repaid more aggressively and at a different rate than the subsidized loan in order to maximize the benefits of the subsidized portion, paying off the unsubsidized portion before the subsidized portion? Or will any payments be prorated among the two portions for a given year's loans?

1 Answer 1


Yes, they can - my wife and I have done that for a few years now. You may need to talk with your lender to ensure any extra payments go first to the principle of the higher-rate loan (though with many of them this is the standard way that they handle it).

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