Missed Priority Deadline -- Can I still get loans?

[SlickMcFavorite]

Hi everyone,

My girlfriend was just accepted by the graduate program near the one I am attending! Hooray!

except...

She applied late (long story) and missed the "Priority Deadline". The school has her FAFSA, and the difference between her expected contribution and the cost of attendance is significant. Unfortunately, the school does not list ANY awards or offers. Other schools where she was accepted had federal loans listed in this section.

I know that, by missing the priority deadline, she missed the opportunity to get grants and whatnot. Still, I didn't think this would exclude her from federally subsidized loans! Do you have to get subsidized loans through your school, or can you get them directly from the Dept of Education?

Any information about this topic would be greatly appreciated.

[OregonGal]

There are no federal subsidized loans for graduate students. However, unsubsidized loans are always available. The priority deadline is for grants, and the May 1 deadline is to help schools process financial aid in a timely fashion. She should contact her financial aid office ASAP to make sure that they have the information they need to set her up with loans.

The loans are processed by the school, but the lender is the Dept of Education, if that makes any sense. So, in school your only contact is with the school's financial aid office and they receive the loan amount directly to be applied to your tuition, and then any leftover for living expenses etc is credited to you by check or direct deposit. After you leave school, your only contact is the Dept of Education Loan Servicing division and you don't make payments to the school.

[SlickMcFavorite]

Great thank you! As it turns out (I should have known this), the school just took a little while longer to process her financial aid info than it took to let her know she was admitted. Still, it's lame that there are no subsidies for graduate loans. I certainly don't want to be heavily invested in the student loan industry when this bubble bursts!

[OregonGal]

Well, the student loan industry is actually pretty well covered--due to the nature of student loan debt, it's usually insured by the federal government (since students generally don't have credit history that would convince banks to loan them money otherwise) so banks won't take much of a loss. Also, student debt usually can't be discharged in bankruptcy like other debts.