Elbert is graduating from college in eighteen months, but he will need a loan in the amount of $4,250 for his last three semesters. He may either receive an unsubsidized Stafford Loan with an interest rate of 6.8%, compounded monthly, or his parents may get a PLUS Loan with an interest rate of 7.8%, compounded monthly. The Stafford Loan has a grace period of six months from the time of graduation. Which loan will have a higher balance and by how much at the time of repayment?

Question

anonymous · Answer

not asking for answers but I am stuck. I wanna say its the PLUS loan

anonymous · Answer

because I am assuming the grace period will charge interest

anonymous · Answer

Stanford Loan

anonymous · Answer

Could you elaborate a little why?

anonymous · Answer

I feel stumped, I'd like to understand it

anonymous · Answer

wow okay, I'm not thinking. I found the answer, thank you! :)