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HPSP and federal loans?

Discussion in 'Military Medicine' started by velouria, Mar 10, 2004.

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  1. velouria

    velouria Senior Member

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    Hi all,

    If you do HPSP for 4 years and the ~$1200/month stipend isn't enough to cover all of your expenses, are you still eligible to get the other federal loans (the $8500 and $30,000 loans, I can't remember what each one is called)? Obviously you wouldn't need to take the full amount, but if you wanted say $10K/year in loans, could you do that through the government programs or would you have to take out private loans?

    Thanks!
  2. Homunculus

    Homunculus SDN Caveman Administrator Moderator

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    you can take out federal staffords for living expenses jsut like everyone else :)
  3. DoctorInSpace

    DoctorInSpace Senior Member

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    Almost all of my classmates on HPSP have also taken out loans to cover living expenses. One of them was living alone, and will get a roommate next year to conserve more, but loans were not a problem.

    Congrats on HPSP!
  4. cdreed

    cdreed Senior Member

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    The rule from the Dept of Edu states that you are eligible to receive federal loans... with a caveat. The stipend is supposed to be considered as part of the financial aid that you receive. As a med student, we are allowed $52,000/yr max in federal support. At my school tuition plus my stipend account for a total of $48,000, therefore I am eligible to receive an additional $4,000/yr in loans to meet the $52,000 max. I get approx $1500/quarter in federal loans. Definitely not enough to cover my expenses because I am married with a family.

    If you plan on going to an expensive school, make sure that you have back-up financial support. Some private lenders will loan to you if you have a cosigner.

    Keep in mind that some schools have not yet conformed to the Dept of Edu's standards, so their students receive loans that they are not "technically" qualified to receive. The financial aid director at my school stated that the fed govt has recently begun to audit these programs to ensure that the rules are followed.

    I would suggest that you contact the financial aid office at the school you want to attend and inquire about their policy regarding this issue.
  5. DoctorInSpace

    DoctorInSpace Senior Member

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    cdreed

    Great point!! I didn't even think about the fact that they take into consideration the cost of the school, which can vary greatly. I'm glad you posted b/c now I know what to tell prospective students when they ask about the scholarship and loans.

    I'm a bit uninformed on the loan aspect of things except for what my classmates tell me. I'm VERY VERY VERY fortunate to have a husband who works, and the only children we have are a golden retriever, a bichon frise, and a big big cat.
  6. Homunculus

    Homunculus SDN Caveman Administrator Moderator

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    how is your tuition money considered "federal support" when you are earning it by having a military commitment? this is the first i've heard of this. it makes absolutely zero sense because of the tuition differences between schools. what if your tuition makes it greater than the 52k? you can't get any loans at all? something doesn't compute here, lol. :) besides, if the military pays your tuition, you aren't using the stafford "funds" for your education-- you aren't costing the dept of education any more than somone who is paying their own way. if this is true, it's plain nuts :)

    maybe it's something we need to check out further.
  7. cdreed

    cdreed Senior Member

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    It is "plain nuts." The AMOPS chapter at my school is organizing a campaign to contact all of our reps and senators so that something can be done to amend the current policies. If you don't believe me, contact your respective surgeon general for verification.

    If I attend the AMOPS convention in Reno (depending on finances), I plan on raising this issue at then. It needs to be addressed. And everyone needs to be made aware of the hardships that some med students are undergoing.

    I should clarify one point. It is your cost of attendance that the FAO uses to gauge loans. My tuition is $32,250. I receive approx $14,000 in HPSP stipend. The sum is $46.250. After subtracting this from the max $52,000, AZCOM HPSP students qualify for approx 4-5 thousand in loans/yr. I don't understand the reasoning for considering our scholarship as federal support either, but nevertheless, it's true... to my dismay.

    Yes, it's unfair and makes absolutely no sense. Individuals that attend inexpensive schools do have access to more federal loans than those that attend schools with pricetags like AZCOM.

    I attend AZCOM, and many people here are having a difficult time monetarily due to this rule. Of course, the people with families are hurting more than singles on the scholarship.

    The sad thing is- NOONE seems to know anything about how the system works or who to talk to have things changed. The way my classmates and I view this situation is that we are govt employees because we pay taxes on the stipend. But the govt does not consider us employees, therefore the stipend should be considered scholarship that is federally provided... therefore limiting the amount of federal loans monies that we may borrow.

    I apologize for the length and incoherent nature of this post, but it is a sore issue for me- especially since I was released from active duty to attend school thinking that I would be eligible for adequate loan monies. Had I been informed ahead of time, I would have chosen to attend a lesser expensive program.

    Cyndi
  8. NJEMT1

    NJEMT1 Member

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    Since I am now learning that we are limited to 52k in federal funding per year of med school... I now have a serious question! What if the cost of my med school tuition, fees, and stipend is greater than 52k? I will be going to Tufts and while I don't know offhand what the total cost of attendance is, I could imagine that the total scholarship value might be greater than 52k. My recruiter said there was no cap to the scholarship...So just to check, even if I wouldn't qualify for any federal loans, could I still get the full scholarship amount (tuition, fees, stipend, insurance) if it is greater than 52k?? Thanks!
  9. Homunculus

    Homunculus SDN Caveman Administrator Moderator

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    call your financial aid office. i'm emailing mine just to see what the scoop is, precisely because of the situation you've mentioned-- not because it will effect me, since i'm graduating in may. something doesn't compute, lol.
  10. bobbyseal

    bobbyseal Boat boy

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    NJEMT1,

    I go to a very expensive private medical school (sorry all, still want to stay anonymous) and the military pays for full tuition + fees + health insurance. On top of that I take out a student loan equal to the amount that is budgeted for students for living expenses. The finaid office doesn't even take into account how much I earn off my stipend.

    Suffice to say, take out as much as you desire in loans. Just remember, the devil will get his due!
  11. cdreed

    cdreed Senior Member

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    Bobbyseal,

    I really do envy you. I suppost that the rules haven't caught up to your program's FAO yet. But I will say that the FA administrator at AZCOM, Carol Dolan, has made it her personal mission to educate all the schools that have not yet complied.

    As a former active duty medic, I expected that the AF would continue to take of me financially while in med school. I was shocked and disgruntled when I arrived at AZCOM only to discover that I would not be allowed to borrow as much federal money as I had planned. I now struggle with school because I HAVE to keep a job on the side just to pay my monthly bills. I really do wish I had the luxury of enjoying the money that evidently many of you are receiving.

    Cyndi
  12. burs0028

    burs0028 eat. sleep. tPA.

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    I have to back up cdreed on this one...I'm an AF HPSP student at AZCOM too and she's giving it to you straight. Don't focus on the 52,000 because that is AZCOM's calculated cost of attendance and will vary from school to school. The key is the fact that your stipend SHOULD (legally) be included in your financial aid package and therefore be subtracted from your financial aid award. At AZCOM the HPSP students can get 4-5 grand from staffords and that's it. It's enough to get by on if your living alone, but a lot of us have significant others/families. My girlfriend moved to Phoenix with me and had a terrible time finding a job. I would much rather have gotten additional loan $ than increase my credit card balances, but didn't have that option.

    While the AF doesn't preclude you from getting any additional loans (AFI 36-101), your financial aid office might. At AZCOM the limit of $52,000 stands, period. They won't certify and additional educational loans beyond that (private included).

    It sounds like some schools aren't yet on board as far as the stipend goes and others may even by certifying educational loans above and beyond the cost of attendance. The best thing you can do is contact your school's financial aid office and see how they handle things.

    Best of luck,
  13. bobbyseal

    bobbyseal Boat boy

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    I feel sorry for you AZCOM'ers! BTW, are just about all students from AZCOM members of the military? When I was doing my summer "boot camp" it seemed like there was a glut of students from AZCOM.

    Anyway, when I file for my student loans with FAFSA I have to include how much I make with the stipend. My school gets a copy of my tax return, but they still offer up loans to the full budget amount less tuition, fees, and insurance. They don't even take into account books!
  14. Homunculus

    Homunculus SDN Caveman Administrator Moderator

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    it sounds like it's really AZCOM that's screwing you over. using Cyndi's post above, it sounds like they expect you to live on approx 20k a year (tuition being 32k or so.) do they have different budgets for married/single? one person could live on 20k with some work, but there's no way a family could, especially if you have some large pre-existing debts.

    it would probably be easier to get your school to change its "living expenses" calculation than to change government regulations. if your FAO is sympathetic to your situation, she should be able to work *something* out i would think.
  15. denali

    denali Senior Member

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    cdreed and others,

    Wow, that sucks!

    When I was considering HPSP the only word I got was that Stafford loans weren't affected by the stipend.

    Is GI Bill available to help you out?
  16. KDBuff

    KDBuff Senior Member

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    it seems to me like everyone is missing the point here. these individuas can only get $52,000 because that is the school's annual budget. a more expensive school will have a higher budget, and will allow more loans. it's basically going to depend on the cost of living where you go to school as to how much you can get in federal loans because everything else is paid for. this has nothing to do with the federal government and how much they say you can take out.

    in my situation, my school allots around $12,000 per nine months for living expenses. i will be allowed to take out $12,000 minus the total of my stipend for that nine months. basically the school is saying you can only live on as much money per month as all of the other students at the school. if you want more than that, you can always go to a private lender just like anyone else would have to do.
  17. bobbyseal

    bobbyseal Boat boy

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    I think the good life may end soon for me as well.

    Unfortunately, my school is considering implementing some changes in their financial aid policy. Like some other folks here, they're might make it so that the stipend counts as part of the scholarship. Thus, I'd make full tuition, plus like $15K with the stipend.

    On my own personal rant, I find that absolutely ridiculous to do. Other scholarships that students receive are not taxed like our stipends. Not many other scholarships require their recipients to work for them for 45 days a year. Finally, I don't know of any other scholarship which has the potential of putting its recipient in harm's way like the HPSP.

    I mean besides the new Jaguar and the ski cabin in Aspen, it's not like I'm really living an extravagant life with the additional loans I'm taking out!!!
  18. cdreed

    cdreed Senior Member

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    I agree with you bobbyseal. And it's not like we're asking for "free" money either. I do have every intention of repaying the federal govt every penny they loan to me. But my school will not allow me to borrow... vicious cycle.
  19. ek6

    ek6 Senior Member

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    Would I be correct to assume, then, that getting the HPSP scholarship would exclude one from getting work-study funding too?
  20. bgworm

    bgworm Member

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    I found out yesterday that NOVA has the same deal as AZCOM basically. I'm an Army HPSP student. They make a budget for the student and the student cannot exceed the budget they make out for you. It is ~52k/year there too. Any money that has to go through the school's fin aid office will count as financial aid and reduces the amount of loans you can borrow. Unfortunately, the military will have the school bill them directly and thus the scholarship money will go through the fin aid office. 52k minus the 29k for tuition leaves about 23k a year you can get from stafford loans. The stipend is paid directly to your bank account and does not go through the school so that will not be counted. I badgered the fin aid guy for about ten minutes to get all of this straight. 23k should be enough to live off of I think, but it would be nice to have the option of taking more if you want.
    I don't think every school does this, but if you need more money definitely ask your financial aid office to get it all straight.
    To get the amount you can still get from any school: find your annual budget (52k/year @ NSUCOM) and subtract your tuition that the military pays. Whatever is left will be the amount of stafford loans you can get.
    Hope this helps

    Wayne
  21. HeavyD

    HeavyD Member

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    Wish AZCOM did things the Nova way. Going through the fin dept or not, our stipend counts AGAINST our total allowable borrowing amount. $4,600.00 is right about the most I and every other HPSP'er I've spoken with at AZCOM can take out from federal funds. Thanks for $380/month added to the stipend you fund Nazi (referring to our esteemed fin. aid director)! Guess Mac&Cheese for the next 3 years isn't so bad. :thumbdown: :mad:
  22. bobbyseal

    bobbyseal Boat boy

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    Woo Hoo!!

    I just got my financial aid package from school today. The good life continues. The stipend is not considered as aid in my package, but rather as income.
  23. Globus P

    Globus P Senior Member

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    Yes, I'm with Heavy D on this.....I'm tired on rice and beans already....

    We've gone round and round with this one and there's not much we can do. Our school was audited by the Dept of Education last year and that's what they dictated. Supposedly, schools get audited every 10 years. So expect changes at more schools, yet hopefully after you've graduated. Here's what our school's budget looks like for HPSP folks:
    Navy Health Prof. Schl. $36,774.00 (yeah, our tuition is through the roof)
    Health Professions Stipend $10,665.00
    Fed Sub. Stafford Loan $405.00
    Fed Unsub Stafford Loan $4,367.00
    Total Aid $52,211.00 Our school's budget

    I simply need to suck it up now and will enjoy not having big loans later (I have to tell myself that or I get ticked off).

    AZCOM HPSPers only get about $4K in aid above the stipend.
    __________________
  24. MaxillofacialMN

    MaxillofacialMN Osteopathic Foot Dentist

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    I know I raised this thread from the dead, but does anyone know what the current numbers are?

    HPSP is like 2k per month, but what is the allotted federal loans for a medical student per year that you can borrow beyond your HPSP "financial aid?"
  25. teacherman84

    teacherman84

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    It varies by school i believe as it depends on the schools budget for students and whether they include the hpsp stipend in the calculation. My school does not count the stipend so I am eligible for another 20k/yr in loans if I so desire.
  26. Roberie

    Roberie

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    It's definitely school specific, which seems odd given the federal loans involved. My school just adds up everything I receive from the army (stipend, tuition, etc.) and deducts it from their "cost of attendance". There is usually a small gap between the two and if we desire to take out loans we are limited to this amount.
    Last edited: Apr 24, 2012
  27. militaryman

    militaryman

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    The name of the program does not help. At my state medical school they consider the health professional scholarship program as a scholarship and thus deduct it from my fininacial aid package. They also considered the stipend as part of the scholarship. I did not take the HPSP because of this. I wish they would change the name of the program, that way you could take out federal finanical aid. Most "scholarships" do not require you to sign a contract for future service. Instead I am using my VA benefits and taking out loans and hoping the student loan repayment program will still be around I graduate.
  28. narcusprince

    narcusprince Rough Rider

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    This wording has tax implications if its pure scholarship then it should not count as income. If its income not counted as scholarships then it should be taxed.
  29. USArmyHPSP

    USArmyHPSP

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    The university needs to look at stipend as a scholarship entitlement when determining the financial need of the students when calculating how much federal financial assistance each student will be allowed. This is governed by USC Title 20, Ch. 28, Sections 1087mm, 1087nn, and 1087vv(j) (which in a nutshell) explain that all scholarships, grants or other assistance will be considered when determining the financial need of the student by the school.

    The reason that the stipend is taxed is not a matter of semantics. It is outlined in the DoD Financial Management Regulation, Vol. 7A, Ch 62 para 620104. While all of chapter 62 explains who gets stipend and when, it is important to note that the cited paragraph specifically states that the stipend is subject to federal income tax withholding. However, social security tax (FICA) will not be withheld. The reason is that wages have FICA tax withheld, but because this is a scholarship entitlement, it is not pay for employment.
    Last edited: Apr 25, 2012
  30. MaxillofacialMN

    MaxillofacialMN Osteopathic Foot Dentist

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    So basically, when I interview in the fall I should ask how each school approaches HPSP and make an informed decision from that. I just don't want to be stuck taking out a private loan with huge interest rates if I run into financial trouble. Thanks for all the insight though, I appreciate it! I guess first I should worry about getting an HPSP before I start asking about my aid package though...

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