Questions about in-school interest capitalized?

Some institutions will require a minimum monthly payment while you are in school. Others wil not, but the interest is accrued and is added to the principal each month. Then when you are done with school you will owe the principal plus all the accrued interest. This increases the total amount of the original loan and you are charged interest on this new total. So you end up paying interest on interest. It is to your advantage to pay the interest on the loan each month. Depending on the annual percent interest, this can be in excess of $1500 a year(@5% on $30,000, initial month interest is $125) added to the original loan. Do yourself a favor and check around and compare.