So I thought with Subsidized Stafford, it was interest free. But now it seems you OWE 2% of what you borrow in what they are calling a loan fee? Am I understanding this correctly?

It depends where you're borrowing from and no, subsidized Stafford loans are not interest free loans. You just aren't required to pay the interest while you're in school, the government "subsidizes" the interest that accrues at that time. After you leave, you will take over paying the interest with your monthly payment. That rate is 6.8%.

I think subsidized stafford loans are currently at 5.6%.... the unsubsidized stafford loans are 6.8%

The loan fee is subtracted from the loan amount before it is disbursed to your school, so you actually get less than you borrowed. That's why many law schools include loan fees in the annual cost of attendance.

No, both Stafford loans are at 6.8% for graduate students.

See my plan was to borrow the 8k subsidized loans a year, and stick it in the bank. And then day 1 after graduation, pay it back and keep the interest. Only now I'm not sure how good a plan that is, because while there is no interest while i'm in school with a subsidized loan, there is the loan fee.

Were you planning on borrowing any unsubsidized and graduate plus loans?

You're right. How discriminatory. thx

Try Discover Student Loans for Graduate Students - they waive all fees.

Not all - you still owe the 1% federal fee on all loans, you are required to pay the 3% origination on GradPlus.

The OP was asking about subsidized loans that he/she is going to repay immediately upon graduation. It is my understanding the Discover waives all fees for the subsidized loan.

Well of course, that was clear.

I talked to a guy at Discover, and he told me that there was still a 1% federal fee (there is no guarantor, prepayment, or origination fees, but that does not necessarily disclude other fees) that is payable on all Stafford loans. Perhaps I heard wrong though.