Unsubsidized student loans accrue interest while a student is in school or in forbearance. This interest is capitalized when the student goes into repayment. Capitalizing interest is the practice of taking accrued interest and adding it into the principal, which then begins to accrue interest, effectively increasing student loan debt and forcing students to pay interest on interest. For example, though I have a job, I cannot afford to pay my loans at this time and they are in forbearance, each year my student loans are accruing upwards of $1200 in interest that will be added into the principal when I go into repayment. This even happens with unsubsidized loans while the student is attending school.This is an unfair practice and puts an undue burden on students. This needs to be changed!
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