Loan Disbursement

[CruiseLover]

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I am fortunate and have found a cheap place to live for med school. Do I go ahead and acept all loans? Can I just not take disbursement on some of the funds? Or if I accept, do I have to take the money and therefore accure the interest?

 

[HC05nmd]

i am bumping this because i was wondering the same thing, as I am trying to figure out whether to accept or partially accept grad plus loans that were offered to me. I havent started looking for a place to live yet because I am not sure if im going there, but I have to respond to the offer before may 1. what if i end up not needing the full amount? do i have to pay it back if i dont actually use it? and do i pay interest on the full amount or just what i used?????

 

[Wolfgang12345]

My understanding is that you can choose the amount of loan money you decide to take. If Stafford is offering you $30k in unsubsidized loans and you only need $10k, then you can take only $10k. In my grad school experience, the loan is disbursed to your school first to cover tuition, and anything left over is sent to you as a check (or direct deposit into your bank account). If you are using the extra loan money for rent, and don't use it all, then it still sits in your bank account accruing interest.

 

[americanpierg]

My understanding is that you can choose the amount of loan money you decide to take. If Stafford is offering you $30k in unsubsidized loans and you only need $10k, then you can take only $10k. In my grad school experience, the loan is disbursed to your school first to cover tuition, and anything left over is sent to you as a check (or direct deposit into your bank account). If you are using the extra loan money for rent, and don't use it all, then it still sits in your bank account accruing interest.

if its subsidized, just take it all and pay it back later, its an interest free loan

 

[HC05nmd]

if its subsidized, just take it all and pay it back later, its an interest free loan

i thought subsidized stafford loans were only interest free while you are in school? after the grace period don't they start acrueing interest? thats what is going on with my undergrad stafford loans

 

[LJDHC05]

You should use the school's budget as a guideline for everything but your housing expenses. Just replace their estimate with what it should be for your housing situation, and only sign for that amount if they give you more money.

If you have too much money at the end of a semester, most loans will allow you to re-pay early. That way you only acrue 6 months of interest, which isn't too bad compared to a decade of compounding with climbing interest rates.

 

[newguy357]

i thought subsidized stafford loans were only interest free while you are in school? after the grace period don't they start acrueing interest? thats what is going on with my undergrad stafford loans

Yes. I had a couple small subsidized staffords for undergrad. They accrue upon graduation...or maybe 6 months after...I don't remember.

To the O.P.: For undergrad you could definitely decline part of the offered loan. The amount they offer is the max. they'll give--you are free to take less than that. Think of it as a "line of credit" with a max. given, not as a lump sum you have to accept or reject.

 

[HC05nmd]

If you have too much money at the end of a semester, most loans will allow you to re-pay early. That way you only acrue 6 months of interest, which isn't too bad compared to a decade of compounding with climbing interest rates.

thanks thats what i was not sure about