I think you have it right.. The EFC affects the amount of subsidized loans that you qualify for- so in your case you'll only get $3500 subsidized, but then will able to get the $15,000 unsubsidized
You are right, this post above is wrong.
Your EFC determines your amount of financial need. (Need = Cost of Attendance - EFC)
The direct loan program is such that, unless you have no financial need whatsoever (ie. your EFC is MORE than the cost of attendance), you will qualify for subsidized loans. Even then, you have a right to unsubsidized loans simply because you applied for financial aid.
Subsidized loans have a max of 8.5k per year.
The unsubsidized loans have a max of 18.5k per year MINUS whatever you got in subsidized loans (ie. if you got 8.5k in SUB loans, you get max 10k in UNSUB loans). This is because sometimes people do not qualify for the SUB loans (due to EFC exceeding COA), so they get only UNSUB loans.
(IE No matter what, the governement will not lend you more than 18.5k per year. How that is divided between the two categories of SUB and UNSUB has to do with your EFC, though NO EFC will remove your right to these loans.)
You, in your case, will qualify for both unsub and sub direct loans--this is because your EFC of 5k is less than the COA (unless you are going to some ridiculously inexpensive law school I have never heard of...)