An unsubsidized loan is a type of student loan that is not based on financial need. Unlike subsidized loans, the government does not pay the interest while the borrower is in school or during deferment periods. This means that interest begins to accumulate as soon as the loan is disbursed. Borrowers are responsible for paying the interest on unsubsidized loans, which can increase the total amount owed over time. These loans are available to both undergraduate and graduate students, making them a common option for financing education. They are part of the federal student loan program, which includes other types of loans like subsidized loans and PLUS loans.