Direct Loans are low-interest loans offered through the U.S. Department of Education for students and parents to help cover the cost of higher education.
Students may be eligible to receive subsidized and unsubsidized loans. Direct Subsidized Loans are available only to undergraduate students who have financial need and the terms of the loan are slightly better than that of an unsubsidized loan in that the U.S. Department of Education pays the interest while the student is:
With an Unsubsidized Direct Loan interest is accrued as soon as they are awarded and must be paid while the student is attending school or allowed to accumulate and added to the principal amount of the loan.
The interest rates for both loans are published each year on July 1st.
Plus loans are federal loans that graduate students and parents of dependent undergraduate students can use to help pay for college.