Doing the Loan Dance

[UrbanWonk]

So by a great stroke of fortune, my financial need wasn't an issue in undergrad due to an extremely generous merit scholarship. Now that I'm about to attend graduate school, I've filled out the FAFSA, and gotten merit aid offers from several schools, none of which are enough to cover tuition. I know there have been a few posts on this topic, but none have fully spelled out the process (please forgive my ignorance).

Specifics about my situation--I have a very low EFC, a small scholarship ($5k) from a private foundation that will carry over to graduate school, and partial tuition merit scholarships at several schools.

I'm guessing I'll need to take out student loans, but I was wondering if anyone knows how a graduate school responds to demonstrated financial need...do I have any shot at getting any grants/work-study positions from the school itself, or is that really just an undergrad thing? Does demonstrated need ever help you secure a TAship or RAship?

I'm also a bit lost with the myriad types of government and foundation-based loans available...if anyone could give me a quick rundown on preferences/advantages, I would really appreciate it.

Lastly, what kind of expenses are eligible for government loans? Can I use them for housing? Meals?

Thank you SO MUCH! I really appreciate the help.

[Scottielass]

I can answer at least part of the questions. Federal loans (Stafford) covers "cost of attendance". That's means any expense related to school including housing, food, books, travel expenses, school supplies, etc. Does not cover a plane ticket to Cancun for spring break .

At the schools I applied to, assistantships in the department were skill/experienced based. But a campus position, such as a resident hall manager may have a need-based element to it.

[chaospaladin]

So by a great stroke of fortune, my financial need wasn't an issue in undergrad due to an extremely generous merit scholarship. Now that I'm about to attend graduate school, I've filled out the FAFSA, and gotten merit aid offers from several schools, none of which are enough to cover tuition. I know there have been a few posts on this topic, but none have fully spelled out the process (please forgive my ignorance).

Specifics about my situation--I have a very low EFC, a small scholarship ($5k) from a private foundation that will carry over to graduate school, and partial tuition merit scholarships at several schools.

I'm guessing I'll need to take out student loans, but I was wondering if anyone knows how a graduate school responds to demonstrated financial need...do I have any shot at getting any grants/work-study positions from the school itself, or is that really just an undergrad thing? Does demonstrated need ever help you secure a TAship or RAship?

I'm also a bit lost with the myriad types of government and foundation-based loans available...if anyone could give me a quick rundown on preferences/advantages, I would really appreciate it.

Lastly, what kind of expenses are eligible for government loans? Can I use them for housing? Meals?

Thank you SO MUCH! I really appreciate the help.

What school and program are you attending? Call the program and ask them how much funding you will receive.

[ZeChocMoose]

But a campus position, such as a resident hall manager may have a need-based element to it.

Generally, not. Usually this too requires experience and an interview. I usually don't suggest this route to a lot of people unless you know you can handle the stress of a live-in position on top of graduate school.

Subsidized stafford loans are need based (up to $8500 per year) and do not accrue interest while you are in school. Take these first. The interest rate is 5% fixed after you graduate.

Unsubsidized loans are not need based (up to $12,000 per year) and begin accruing interest while you are still in school. These are the next best option. The interest rate is 6.5% fixed.

The interest rate for Stafford loans (Subsidized or Unsubsidized) is 6.8% for graduate students. I would suggest reading the federal student financial aid website. http://studentaid.ed...gradstudent.jsp

Make sure you understand the terms and conditions of your education loan(s) before you sign.

Edited April 9, 2011 by ZeChocMoose

[HandsomeNerd]

^ this. I was on the student loan website the other day, and correct me if I'm wrong, but there's basically no difference between Subsidized and Unsubsidized Federal loans at the graduate level. Subsidized are like 3.4% but only for undergrads-- for grads, it's 6.8%, the same as unsubsidized...

[palabared]

the way I understood it when reading through info on subsidized/unsubsidized: the main difference between the two at the grad level is that subsidized loans dont accrue interest during your 2 years at school, meaning they dont cost you as much in the end, even though its the same interest rate.

edit: It just sucks that $8500 is the max you get per year.

^ this. I was on the student loan website the other day, and correct me if I'm wrong, but there's basically no difference between Subsidized and Unsubsidized Federal loans at the graduate level. Subsidized are like 3.4% but only for undergrads-- for grads, it's 6.8%, the same as unsubsidized...

Edited April 27, 2011 by palabared