Medical School Loans

[MedMike]

So I am confused about the whole medical school loan process. Any insight will be helpful.

- I know federal loans only helps so much, so the rest comes from private loans. What programs with private loans are people going through?

- You file your FAFSA every year right? So you get a certain amount each year, and that could change?

- With the private loans, do you get the loan in one big amount or do you ask for an amount for each year?

- Anyone know what the interest rates are looking like for both federal and private loans? I know private is higher.


Any help is much appreciated. Will be starting school in the fall and want to make sure that I am going about this in the right way.

THANKS everyone

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[MedPR]

So I am confused about the whole medical school loan process. Any insight will be helpful.

- I know federal loans only helps so much, so the rest comes from private loans. What programs with private loans are people going through?

- You file your FAFSA every year right? So you get a certain amount each year, and that could change?

- With the private loans, do you get the loan in one big amount or do you ask for an amount for each year?

- Anyone know what the interest rates are looking like for both federal and private loans? I know private is higher.


Any help is much appreciated. Will be starting school in the fall and want to make sure that I am going about this in the right way.

THANKS everyone

Grad plus is a federal loan the last time I checked and will cover all expenses if you need more than max Stafford.

Stafford is 6.8 and grad plus is 7.9. Private will vary by lender I think.

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[Bacchus]

See bolded.

So I am confused about the whole medical school loan process. Any insight will be helpful.

- I know federal loans only helps so much, so the rest comes from private loans. What programs with private loans are people going through?
You can go to medical school on only private loans. The first loan that is maximized is the Stafford (unsubsidized only) at 40,500 dollars and 6.8%. After that, you can apply for the Grad Plus loan (requires a "decent" credit report) up to the cost of attendance at 7.9%.

- You file your FAFSA every year right? So you get a certain amount each year, and that could change?
Yes, every year and it can change. The cost of attendance increases your third and fourth years because you're in school more months than your first or second year.

- With the private loans, do you get the loan in one big amount or do you ask for an amount for each year?
Don't take private loans. Their rates can be very good, but they aren't fixed. Once the economy recovers you'll be at the mercy of the lending institution. Also, if you die, federal loans are discharged whereas private loans are not putting the burden on your future spouse and family or any cosigner of the loan (required to get the best rates).

- Anyone know what the interest rates are looking like for both federal and private loans? I know private is higher.
See above

Any help is much appreciated. Will be starting school in the fall and want to make sure that I am going about this in the right way.

THANKS everyone

 

[MedPR]

See bolded.

Grad plus eligibility has nothing to do with your credit score. You need to have a fairly clean credit report (not sure which one they use), but score is irrelevant.

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[mvenus929]

- I know federal loans only helps so much, so the rest comes from private loans. What programs with private loans are people going through?

It's going to depend on the financial aid that your school can provide, and what your lending history is so far (how much federal aid you have accepted thus far). Mine gives a substantial amount in grants, and provides a low interest (cheaper than federal) loan in a small amount. The rest is covered by stafford loans. If you need more than that, there's Grad Plus loans.

- You file your FAFSA every year right? So you get a certain amount each year, and that could change?

Yes, and if you want institutional aid, you generally need your parent's information as well. Most of the time, your aid package will get better after your first year, because most people don't work during medical school, but may work before.

- With the private loans, do you get the loan in one big amount or do you ask for an amount for each year?

All loans you ask only for the amount you need that year. You do not want to be accruing interest on thousands of dollars that you're not going to use that year.

 

[eggs13]

quick question about loans:

say COA is $70,000, with tuition being $50,000 and COL being $20,000. Is the $20,000 for COL considered income and therefore taxable? Or is it untaxed because it's a loan?

sorry if this is a stupid question!

 

[MedPR]

quick question about loans:

say COA is $70,000, with tuition being $50,000 and COL being $20,000. Is the $20,000 for COL considered income and therefore taxable? Or is it untaxed because it's a loan?

sorry if this is a stupid question!

Untaxable. The govt makes up for that in the form of interest.

 

[kfsa1]

See bolded.

I thought the maximum limit for unsubsidized Stafford loans was $32,000:

https://www.aamc.org/advocacy/meded/79232/federal_student_loans.html

From what I understand, the 40,500 was including subsidized loans of $8,500 which are no longer available to grad/medical students since 2011.

On a side note, does anyone think it is worth entering my parent's info to qualify for grant aid from my institution if I have a fair amount of money in the bank? (greater than 50k under 100k)

 

[911 Turbo]

Uh......



Medmike = MedPR




right?

 

[cwrig14]

Might be a silly question..but are there any forms of need based grants in financial aid packages? Besides scholarships..

 

[calvnandhobbs68]

Might be a silly question..but are there any forms of need based grants in financial aid packages? Besides scholarships..

I don't quite get what you're saying. Schools might call some need-based aid "grants" or "scholarships" but unless you have to do something for the grant they're effectively the same thing.

 

[sector9]

I thought the maximum limit for unsubsidized Stafford loans was $32,000:

https://www.aamc.org/advocacy/meded/79232/federal_student_loans.html

From what I understand, the 40,500 was including subsidized loans of $8,500 which are no longer available to grad/medical students since 2011.

On a side note, does anyone think it is worth entering my parent's info to qualify for grant aid from my institution if I have a fair amount of money in the bank? (greater than 50k under 100k)

That info is outdated. The max of $40.5k is still the same. However, we are no longer able to have any portion of the Stafford loan be subsidized.

 

[Ismet]

On a side note, does anyone think it is worth entering my parent's info to qualify for grant aid from my institution if I have a fair amount of money in the bank? (greater than 50k under 100k)

You need to enter your parents' info regardless of how old you are or how much money you have in the bank if you want to be considered for scholarships/grants at most schools. Each school might have their own little exceptions, but for the most part, this is true.

 

[Ismet]

quick question about loans:

say COA is $70,000, with tuition being $50,000 and COL being $20,000. Is the $20,000 for COL considered income and therefore taxable? Or is it untaxed because it's a loan?

sorry if this is a stupid question!

Whatever loans you take out above tuition is not "income" in any sense as you have to pay it back + interest.

 

[cwrig14]

I don't quite get what you're saying. Schools might call some need-based aid "grants" or "scholarships" but unless you have to do something for the grant they're effectively the same thing.

At least for undergrad, grants were federal or state aid and were dependent solely based on need. Scholarships were merit based.
That's been my experience.

 

[calvnandhobbs68]

At least for undergrad, grants were federal or state aid and were dependent solely based on need. Scholarships were merit based.
That's been my experience.

Got it. It's basically the same breakdown. Some medical schools have merit based scholarships (most don't). I'm pretty sure most of the MD schools have some form of need based aid, whether they call them grants or scholarships.

The difference will be that schools will typically inform you separately if you've received a merit based scholarship. Some include it when they return with your financial aid info but they'll tend to clearly mark it as a merit scholarship. On the other hand, you won't find out about need based scholarships/grants until you've submitted your financial aid info (because they're based on it).

 

[MedPR]

Uh......



Medmike = MedPR




right?

noob

 

[cwrig14]

Got it. It's basically the same breakdown. Some medical schools have merit based scholarships (most don't). I'm pretty sure most of the MD schools have some form of need based aid, whether they call them grants or scholarships.

The difference will be that schools will typically inform you separately if you've received a merit based scholarship. Some include it when they return with your financial aid info but they'll tend to clearly mark it as a merit scholarship. On the other hand, you won't find out about need based scholarships/grants until you've submitted your financial aid info (because they're based on it).

Thank you for the clarification

 

[bollywoodlover]

Will I be able to take out extra money for an apartment as part of my federal loans? My tuition is about 16 k a year (does not include apartment cost). In order to get a grad plus loan, do I need to have a credit history? I've never had a credit card just debit.

 

[pre med 2014]

Will I be able to take out extra money for an apartment as part of my federal loans? My tuition is about 16 k a year (does not include apartment cost). In order to get a grad plus loan, do I need to have a credit history? I've never had a credit card just debit.

I wanna go to a state school. 16K is so cheap

 

[bollywoodlover]

Texas for the win!

 

[sector9]

Will I be able to take out extra money for an apartment as part of my federal loans? My tuition is about 16 k a year (does not include apartment cost). In order to get a grad plus loan, do I need to have a credit history? I've never had a credit card just debit.

Yes, you can take out federal loans up to the cost of attendance as calculated by your school. Room and board is one of the categories that the school will include in their calculation. I don't think that you need to necessarily have a good credit history to get Grad plus loans but rather the absence of some specific negative information on your report. I'm sure MedPR can correct me if I'm wrong.

 

[DocVapor]

Will I be able to take out extra money for an apartment as part of my federal loans? My tuition is about 16 k a year (does not include apartment cost). In order to get a grad plus loan, do I need to have a credit history? I've never had a credit card just debit.

The school's financial aid department (or some similar department) will publish a "Cost of Attendance" that will include living expenses such as food, apartments, travel, etc. It effectively becomes the maximum amount of money that you are allowed to borrow from the federal government. You aren't expected to work during medical school, and you are also considered independent from your parents for the FAFSA/federal loans, thus you aren't expected to get money from them to live on either. If you are awarded any grants/scholarships, the amount you get from those gets deducted from the maximum limit for federal borrowing. If you live frugally, have roommates, etc, you will not need to borrow (and should not borrow) anywhere close to the maximum allowable amount.

 

[sector9]

The school's financial aid department (or some similar department) will publish a "Cost of Attendance" that will include living expenses such as food, apartments, travel, etc. It effectively becomes the maximum amount of money that you are allowed to borrow from the federal government. You aren't expected to work during medical school, and you are also considered independent from your parents for the FAFSA/federal loans, thus you aren't expected to get money from them to live on either. If you are awarded any grants/scholarships, the amount you get from those gets deducted from the maximum limit for federal borrowing. If you live frugally, have roommates, etc, you will not need to borrow (and should not borrow) anywhere close to the maximum allowable amount.

Agreed. If your tuition is only 16k, and since Stafford loans will go up to 40k, you really shouldn't have to worry about grad plus loans at all unless you're married with kids

 

[MedPR]

Yes, you can take out federal loans up to the cost of attendance as calculated by your school. Room and board is one of the categories that the school will include in their calculation. I don't think that you need to necessarily have a good credit history to get Grad plus loans but rather the absence of some specific negative information on your report. I'm sure MedPR can correct me if I'm wrong.

Yea that's accurate to the best of my knowledge. Thin file doesn't mean bad file.

Also you can have a credit report even if you've never had a credit card.

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[bollywoodlover]

Awesome. I hope I have enough to buy a computer and take a few plane trips to see my significant other in Arizona. Do most people take out extra loans 4th year to apply for residency? What's the average cost to apply and fly out everywhere. I think I heard its maybe around 10 or 20 grand?

 

[MedPR]

Awesome. I hope I have enough to buy a computer and take a few plane trips to see my significant other in Arizona. Do most people take out extra loans 4th year to apply for residency? What's the average cost to apply and fly out everywhere. I think I heard its maybe around 10 or 20 grand?

20 grand? Sounds ridiculous, but I guess it depends on how many places you interview at. I think I spent around $4k on interviews this cycle.

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[calvnandhobbs68]

20 grand? Sounds ridiculous, but I guess it depends on how many places you interview at. I think I spent around $4k on interviews this cycle.

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Depending on who you are you might interview at quite a few places for residency, just so you can put them on your rank list.

 

[MedPR]

Depending on who you are you might interview at quite a few places for residency, just so you can put them on your rank list.

I guess I'm just used to $500 being a normal cost for interviewing. Probably because I'm in the Midwest so I didn't have to fly cross country, which I know can be much more costly.

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[hunterjumper14]

Awesome. I hope I have enough to buy a computer and take a few plane trips to see my significant other in Arizona. Do most people take out extra loans 4th year to apply for residency? What's the average cost to apply and fly out everywhere. I think I heard its maybe around 10 or 20 grand?

Each place I've been to includes estimated travel expenses for residency interviews in the estimates for COA for 4th year.