Can I even take out a loan?

[rogue]

So, I've been digging through some old threads here and found similar questions to what I'm about to ask, but nothing that seems to answer it definitively. What I'm trying to figure out is, if I have a full fellowship where the program pays all my tuition and fees and gives me a stipend as well ($27K), is there any way I can take out a Direct or PLUS loan (or really, any non-private loan) on top of that? Or am I considered not eligible because what the school provides should cover all my expenses?

I'm trying to find this out from the school, but in the meantime, any advice would be welcome.

(In case anyone is wondering why I'd want to saddle myself with debt when I'm already being funded by the program, I'm presently stuck with a rather high mortgage. Though I'm trying to sell my house, there's obviously no guarantee that'll happen before classes start this fall. So, I just need a backup plan for what I hope would be no more than a few months of making ends meet.)

[reimaginethis]

Each school calculates its own Cost of Attendance (COA). Besides tuition and fees, COA takes standardized housing cost, transportation cost, and several other factors into account. After your fellowship/funding is deducted from the COA, you can borrow (via federal loans) up to the COA; however, all of your funding sources, when combined, cannot exceed the COA.

I don't know of any schools that set their COA as high as $27k after tuition and fees. However, you may be in a really, really expensive place. Keep checking with the school's financial aid office, and ask them about the school's COA.

Best wishes.

[rogue]

That's sort of what I was afraid of. Thanks for the clarification.

[rising_star]

I'm still eligible for Federal PLUS loans in spite of having a tuition waiver and a stipend. I imagine that you will be too, rogue.

[rogue]

That would be lovely. Are PLUS loans not based on the COA?

[rogue]

Oh, ignore that question. I see on the school site that PLUS loans are up to the amount of the COA, less any other aid. Here's hoping my school has a high COA, which I've yet to find on their site.

[coyabean]

I've never heard of a school's COA being so low that a student on a stipend couldn't qualify for a loan. Seriously, never. Most schools include things like living alone, books, travel and transportation expenses above and beyond all of your tuition and fees to calculate that COA. It's designed to be a generous estimate. I pulled out some old admissions counseling guides from my former life and every school listed has a COA at about 175% of their published tuition rate.

ETA: also, I'm not positive that your stipend is considered "aid" for these purposes. I don't have my award letter yet but my best friend has her's from UNC. she has a fellowship, tuition waiver AND an additional diversity fellowship and she still qualified for loans...at a state school...with in-state tuition. Really your stipend is a salary, not exactly financial aid.

Edited May 17, 2010 by coyabean

[reimaginethis]

Just to make sure I was giving correct info in my previous post, I did a quick search on Google and found the following from Miami University:

"In order to remain compliant with federal regulations, the amount of a graduate assistantship is subtracted from the COA to determine the student's remaining financial aid eligibility."

I then found similar statements on several other sites.

So yes, as I stated, assistantship/fellowship/stipend is considered when calculating loan eligibility.

Best wishes.

Edited May 17, 2010 by reimaginethis

[coyabean]

Just to make sure I was giving correct info in my previous post, I did a quick search on Google and found the following from Miami University:

"In order to remain compliant with federal regulations, the amount of a graduate assistantship is subtracted from the COA to determine the student's remaining financial aid eligibility."

I then found similar statements on several other sites.

So yes, as I stated, assistantship/fellowship/stipend is considered when calculating loan eligibility.

Best wishes.

Well, alrighty then. Go with the person with links! LOL

[rogue]

Thanks, everyone. I did hear from someone in my program that some of the students do occasionally take out Stafford loans (which I guess have been replaced with Direct loans) for living expenses. Since we all get the same tuition waiver and stipend, that bodes well for me. Now to sort things out with the university financial aid office.

[rising_star]

Thanks, everyone. I did hear from someone in my program that some of the students do occasionally take out Stafford loans (which I guess have been replaced with Direct loans) for living expenses. Since we all get the same tuition waiver and stipend, that bodes well for me. Now to sort things out with the university financial aid office.

I think you're confused. Stafford loans are Federal Direct loans. They can either be subsidized or unsubsidized.

[coyabean]

Thanks, everyone. I did hear from someone in my program that some of the students do occasionally take out Stafford loans (which I guess have been replaced with Direct loans) for living expenses. Since we all get the same tuition waiver and stipend, that bodes well for me. Now to sort things out with the university financial aid office.

Yeah, I figured you'd be fine. Again, I've never heard of a stipend so high that one doesn't qualify for a loan. Good luck to you!

[rogue]

Just to follow up, in case anyone else is reading this later and has a similar situation/question, I got a letter from the financial aid office yesterday, and am approved for $8,500 in subsidized Direct loans and $12,000 in unsubsidized. Hopefully I won't need either, but it's a relief to have this available as a backup plan. Thanks to everyone for the info/advice.

[hamster]

Just to follow up, in case anyone else is reading this later and has a similar situation/question, I got a letter from the financial aid office yesterday, and am approved for $8,500 in subsidized Direct loans and $12,000 in unsubsidized. Hopefully I won't need either, but it's a relief to have this available as a backup plan. Thanks to everyone for the info/advice.

Thanks. This helps.

[suzy]

So very helpful! Thanks for posting this!