What type of loan accumulates interest while the borrower is enrolled in school?

The reason the answer focuses on Direct unsubsidized loans and PLUS loans is that both of these loan types begin accumulating interest as soon as the funds are disbursed, even while the borrower is still in school. This means that while students are enrolled at least half-time, they are responsible for the interest that accrues on these loans, and it can capitalize—meaning it can be added to the principal balance—if not paid off during the school term.

In contrast, Direct subsidized loans do not accrue interest while the borrower is enrolled at least half-time. The government covers the interest during this period to help reduce the overall debt burden for students.

It's important to note that not all student loans accrue interest in this manner; federal loans vary, and private loans can have different terms altogether. Thus, the correct identification of loan categories clarifies the differences in how interest is handled based on enrollment status.