Paying off credit card debt with med school loans?

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reese07

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Like most non trads, I had to live independently for a couple of years with a low paying biology related job. I ended up racking up about 10k in credit card debt from paying travel costs for interviews and applications, etc. I will start med school next year and was wondering if its smart to pay off my cards with my med school loans. Any other suggestion to how I can fix my situation?
 
Probably not the best idea to use debt to pay debt. I'm in the same boat as you, so I feel your pain! I picked up an extra job to help because I am dead set on getting mine paid off before school starts next summer...I've already dragged these balances around through undergrad, I want them gone!
 
HH8911 said:
Probably not the best idea to use debt to pay debt. I'm in the same boat as you, so I feel your pain! I picked up an extra job to help because I am dead set on getting mine paid off before school starts next summer...I've already dragged these balances around through undergrad, I want them gone!
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Well I doubt my 26k/yr will be enough to pay all 10k back by the time I start school. And once I start school I won't have any income and I'm worried about the high interest rate of my credit cards hurting me more. Can't I just paying it off with the loan and pay that off once I start working as a physician?
 
Student loans can never be dropped in bankruptcy.....credit cards can

NEVER pay off your cards with student loans
 
I'm going to disagree with the previous 2 posters. It is very smart to change debt from a higher interest account to a lower interest account, and credit cards have the highest interest rates of all forms of debt. Credit card debt should be the first form of debt that anyone tries to pay off due to the interest rates (up to 30% in some cases).

That being said, I don't know much about the legalities or conditions of student loans, so I won't comment on that.
 
Seems like the only option is to pay it off with my loans since I won't have outside income while in med school..
 
reese07 said:
Seems like the only option is to pay it off with my loans since I won't have outside income while in med school..
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Don't do it. I don't think it's legal. You may be committing fraud. There is usually fine print that stipulate what your grad student loans can be used for.

Talk to your school's financial adviser. Call them, explain your problem, and ask if they have any advice.
 
reese07 said:
Seems like the only option is to pay it off with my loans since I won't have outside income while in med school..
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Unless you have access to cheaper money, or your CC rate is very low, moving the debt to student loans might be your cheapest option.

What's the rate on your CC?
 
It seems like most people's response is not to do this. However, can you guys shed some light on what someone SHOULD do in this type of situation?

I will also have some debt left over by the time I start school. The answer can't simply be to let the interest accrue.. 😱
 
At the very least, a private loan is always an option. I got $8500 of credit card debt (at 30% interest) paid off in 2 years time by shifting it to a private loan from my local bank at ~2% interest. The minimum monthly payment went down by over $100. Huge difference, I only regret not doing it sooner.
 
I'm pretty surprised at people's responses. You surely aren't going to get in legal trouble for using student loans to pay off a credit balance obtained by applying to med school. I personally know many people that have done this and there have been many SDN users discussing their intention of doing this in the past.

Do what you need to do. I would personally pay it off with my student loans (slowly if you want). You'll be consolidating the debt to one location and it will be at a lower interest rate that you can pay back over years. This is a non-issue.

Furthermore, you should have NO problem taking out enough money to pay that off, especially if you do it over the 4 years. Many schools drastically overstate the budget you need to live on. I'm taking out multiple thousands of dollars less than suggested and living in a very nice place in the most expensive city in the country. You can use that money to cover your app expenses, which is a relatively small portion of the multi-hundred thousand dollar and 11+ year commitment you're putting into becoming a practicing physician.
 
Starry said:
Don't do it. I don't think it's legal. You may be committing fraud. There is usually fine print that stipulate what your grad student loans can be used for.

Talk to your school's financial adviser. Call them, explain your problem, and ask if they have any advice.
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How is it fraud? Once the school cuts you your COA loan check, you're paying off your credit cards using your own money. It's borrowed, but its still yours.

That being said, i don't recommend doing this, you'll end up paying 2-3 dollars for every 1 dollar you pay off on the CC, but if you have no other options then go for it.
 
Hemorrage said:
How is it fraud? Once the school cuts you your COA loan check, you're paying off your credit cards using your own money. It's borrowed, but its still yours.

That being said, i don't recommend doing this, you'll end up paying 2-3 dollars for every 1 dollar you pay off on the CC, but if you have no other options then go for it.
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It is against the terms of the loan. At least the undergraduate loans that I have seen are very specific in how you can use the money. Not meeting these conditions can result in the whole load being due immediately. Of course, that is rarely caught and enforced but it is something to be aware of.
 
If you spend your COA money paying off credit cards, where will you get money to eat and pay rent? If you do have a source of income during medical school then yes, it does make sense to pay off high-interest credit cards with (relatively) low-interest loans. However, most students don't have additional money coming in, and working a part-time job is generally not a good idea unless you are qualified for something that pays extremely well. I did take a good portion of my loan money and use it to pay off credit cards, but I don't recommend this for everyone. I've got a source of income, a house that I'm renting out because I couldn't sell it before med school started. For anyone else with a lot of credit card debt, I'd say the best move would be to cut your expenses during med school to the minimum, work during the MS1-MS2 summer, and use whatever loan money you have left over after living expenses to pay off the highest interest credit cards as soon as you can.
 
milski said:
It is against the terms of the loan. At least the undergraduate loans that I have seen are very specific in how you can use the money. Not meeting these conditions can result in the whole load being due immediately. Of course, that is rarely caught and enforced but it is something to be aware of.
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Med school loans have slightly different rules. You can borrow up to the cost of attendance at a school, which includes tuition, fees, and a living allowance. The government gives funds to the school, which then takes out the tuition and fees and cuts you a check for the rest, once per semester. You're free to spend the living allowance however you want. I should mention that this is money you really can't afford to lose, so don't gamble with it or put it in the stock market or anything like that, no matter how attractive this may seem at the time. I'm dating myself here, but I went to college at the tail end of the dotcom bubble. Some of my classmates had borrowed all they could in student loans and invested in Yahoo, pets.com, and all the other stocks that seemed like a good idea when their values were doubling weekly. When the bubble burst they were left with no money to stay in school, which meant that they had to drop out and find jobs, which meant that their loan payments began immediately. Not a good situation in a college town with limited employment prospects.
 
I was in the exact same position last year (with roughly the same high interest rate). Schools usually estimate their COA much higher than the actual COA, so you should be able to pay off the credit card debt with student loans fairly easily. 21% vs 7% is kind of a no brainer, especially because you won't be paying any of the debt off for at least 5 years.
 
Chip N Sawbones said:
Med school loans have slightly different rules. You can borrow up to the cost of attendance at a school, which includes tuition, fees, and a living allowance. The government gives funds to the school, which then takes out the tuition and fees and cuts you a check for the rest, once per semester. You're free to spend the living allowance however you want. I should mention that this is money you really can't afford to lose, so don't gamble with it or put it in the stock market or anything like that, no matter how attractive this may seem at the time. I'm dating myself here, but I went to college at the tail end of the dotcom bubble. Some of my classmates had borrowed all they could in student loans and invested in Yahoo, pets.com, and all the other stocks that seemed like a good idea when their values were doubling weekly. When the bubble burst they were left with no money to stay in school, which meant that they had to drop out and find jobs, which meant that their loan payments began immediately. Not a good situation in a college town with limited employment prospects.
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That seems very similar to what I've seen as undergrad loans, the school gets the money from the government, keeps whatever it needs for tuition/fees and cuts you a check for the rest. Practically, it is very hard to control what happens with the money after that point. That still does not mean that you are not in violation of the terms of the loan if you spend them on a car payment, or some sort of gambling. I have no idea how often that is enforced and why would it even come up but it is there in the fine print of the loan.
 
Starry said:
Don't do it. I don't think it's legal. You may be committing fraud. There is usually fine print that stipulate what your grad student loans can be used for.
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Nonsense. Your loans are designed to cover your expenses while you are a full time student. Apt, food, tuition, travel, car, insurance, liquor, condoms, clothes, spring break, etc. Existing debt is an expense that must be maintained. Miss a payment and your crappy 10% rate will jump to 25% or more. Then you're really screwed.
Your best bet is to pay as much as you can with savings, get a loan for what you can and make at least the minimum payments. It's not ideal, but a professional student isn't in the same boat as the average Joe.
Borrow as little as you can, but enough to maintain your necessary expenses. Is a low budget week long trip after finals to the beach worth it? Quite possibly. Just remember you're probably paying back 1.5-2x what you borrow.
 
This was my plan in medical school and residency:

1) Stay childless and unmarried for the duration of this particular plan
1) Rent a local PO Box
2) Obtain a very low cost 24hr gym membership if the school/hospital does not offer a gym and/or showers
3) Have your bills sent to PO Box and/or family member's home and/or go paperless
4) Cell phone & laptop
5) Free wi-fi at school and hospital and/or starbucks, whatever
6) No apartment
7) Buy parking pass for hospital/medical school lot and live out of your car and/or hospital call rooms, lecture halls, study rooms, etc (rotate these locations)
8) Wear scrubs that are laundered for free
9) Laundromat once every other week to wash underwear, socks and dress clothes for rotations that require
10) Keep this on the down-low as you are essentially homeless
11) Attend conferences and lectures which provide free food and/or eat at the hospital cafeteria on the employee discount.
12) Go back to his/her place when necessary and/or priceline a hotel when need arises

PAY OFF ENTIRE CC DEBT with your loan money immediately.

You will only have to do this your first year, but if you've gotten the hang of it you might be tempted to continue for as long as the cost-savings are realized. The highest living expenses are usually housing and utilities of which you'll save a bundle. All you'll have to pay for is a cell phone - no rent, gas, electric, cable, water, etc.
 
Jay K said:
This was my plan in medical school and residency:

1) Stay childless and unmarried for the duration of this particular plan
1) Rent a local PO Box
2) Obtain a very low cost 24hr gym membership if the school/hospital does not offer a gym and/or showers
3) Have your bills sent to PO Box and/or family member's home and/or go paperless
4) Cell phone & laptop
5) Free wi-fi at school and hospital and/or starbucks, whatever
6) No apartment
7) Buy parking pass for hospital/medical school lot and live out of your car and/or hospital call rooms, lecture halls, study rooms, etc (rotate these locations)
8) Wear scrubs that are laundered for free
9) Laundromat once every other week to wash underwear, socks and dress clothes for rotations that require
10) Keep this on the down-low as you are essentially homeless
11) Attend conferences and lectures which provide free food and/or eat at the hospital cafeteria on the employee discount.
12) Go back to his/her place when necessary and/or priceline a hotel when need arises

PAY OFF ENTIRE CC DEBT with your loan money immediately.

You will only have to do this your first year, but if you've gotten the hang of it you might be tempted to continue for as long as the cost-savings are realized. The highest living expenses are usually housing and utilities of which you'll save a bundle. All you'll have to pay for is a cell phone - no rent, gas, electric, cable, water, etc.
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Financially genious...lol but I could never. I need a comfortable bed to sleep on! Especially when studying for exams etc.
 
bit of a sidetrack, but... I keep seeing people say that schools have a COA that seriously overestimates what the actual COA is. This confuses me because most places I've seen are estimating 17-20k a year for COL, which might be a little high if you're living with 3 or more roommates and eating nothing but ramen but it's only like 150% of the federal poverty level for 1 person. Are y'all finding places that offer much higher cost of living estimates?
 
Chip N Sawbones said:
Med school loans have slightly different rules. You can borrow up to the cost of attendance at a school, which includes tuition, fees, and a living allowance. The government gives funds to the school, which then takes out the tuition and fees and cuts you a check for the rest, once per semester. You're free to spend the living allowance however you want. I should mention that this is money you really can't afford to lose, so don't gamble with it or put it in the stock market or anything like that, no matter how attractive this may seem at the time. I'm dating myself here, but I went to college at the tail end of the dotcom bubble. Some of my classmates had borrowed all they could in student loans and invested in Yahoo, pets.com, and all the other stocks that seemed like a good idea when their values were doubling weekly. When the bubble burst they were left with no money to stay in school, which meant that they had to drop out and find jobs, which meant that their loan payments began immediately. Not a good situation in a college town with limited employment prospects.
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IlDestriero said:
Nonsense. Your loans are designed to cover your expenses while you are a full time student. Apt, food, tuition, travel, car, insurance, liquor, condoms, clothes, spring break, etc. Existing debt is an expense that must be maintained. Miss a payment and your crappy 10% rate will jump to 25% or more. Then you're really screwed.
Your best bet is to pay as much as you can with savings, get a loan for what you can and make at least the minimum payments. It's not ideal, but a professional student isn't in the same boat as the average Joe.
Borrow as little as you can, but enough to maintain your necessary expenses. Is a low budget week long trip after finals to the beach worth it? Quite possibly. Just remember you're probably paying back 1.5-2x what you borrow.
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I don't think it's nonsense. The OP will not be using the loans for the cost of living while in school. He's using it to cover previous debts incurred before school. This is highly likely to be against the terms of his loan. Even if no one ever really reads all that fine print and there is a low risk of getting caught, it's still not advisable to do what the OP is considering.

I do accept the chance that I may be wrong. I understand that perhaps you can argue that the interest on his debt is an expense that is part of the cost of living while in school and so therefore it is okay to use it for such. But unless the OP reads the fine print on his specific loans to find out, then we'll never know for sure, and I'm a bit shocked that you would be so dismissive towards my concerns as "nonsense." 🙁

I have no idea what the "slightly different rules of med school loans" are. As far as I understand, they are considered graduate student loans. And I think milski is right on point.

milski said:
Practically, it is very hard to control what happens with the money after that point. That still does not mean that you are not in violation of the terms of the loan if you spend them on a car payment, or some sort of gambling. I have no idea how often that is enforced and why would it even come up but it is there in the fine print of the loan.
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Starry said:
I don't think it's nonsense. The OP will not be using the loans for the cost of living while in school. He's using it to cover previous debts incurred before school. This is highly likely to be against the terms of his loan. Even if no one ever really reads all that fine print and there is a low risk of getting caught, it's still not advisable to do what the OP is considering.

I do accept the chance that I may be wrong. I understand that perhaps you can argue that the interest on his debt is an expense that is part of the cost of living while in school and so therefore it is okay to use it for such. But unless the OP reads the fine print on his specific loans to find out, then we'll never know for sure, and I'm a bit shocked that you would be so dismissive towards my concerns as "nonsense." 🙁

I have no idea what the "slightly different rules of med school loans" are. As far as I understand, they are considered graduate student loans. And I think milski is right on point.
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No, you are correct. Paying off credit cards is one of the few things specifically included in the list of things you're supposed to not use the money for. In reality...
 
I don't know where everyone is getting this notion. At my school we can fill out a loan increase form to draw out more than the estimated CoA and one of the lines on the form is credit card payments. I believe we can draw up to $100/month to make credit card payments.

With the kind of crap people use loan money to pay for anyhow, I think paying down debt is a relatively responsible choice compared to a post-test booze/shoes cruise.
 
as1212559 said:
I don't know where everyone is getting this notion. At my school we can fill out a loan increase form to draw out more than the estimated CoA and one of the lines on the form is credit card payments. I believe we can draw up to $100/month to make credit card payments.

With the kind of crap people use loan money to pay for anyhow, I think paying down debt is a relatively responsible choice compared to a post-test booze/shoes cruise.
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Then the loans you will be offered to pay for that are likely not federal loans (i.e., the ones you most likely want barring any other sweet deals) as consumer debt is not included in your "cost of attendance" (and, thus, not eligible to be paid for with federal loan money). The difference is really academic since no one is going to come bust into your home and audit your spending habits, but for the those that are extremely straight-edged it's technically not in line with the conditions of federal loan programs. I could be wrong but that seems to be the information I find online as well as what we are specifically told during financial aid counseling.
 
milski said:
It is against the terms of the loan. At least the undergraduate loans that I have seen are very specific in how you can use the money. Not meeting these conditions can result in the whole load being due immediately. Of course, that is rarely caught and enforced but it is something to be aware of.
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Loans can be used for tuition and monthly living expenses. A monthly payment on a debt is a monthly expense that needs to be paid. It's perfectly acceptable to use student loans to pay off higher interest credit card debt.

Just don't use the loans for hookers and blow and you'll be fine.
 
ŒYou can borrow up to the maximum amount the school establishes for the cost of attendance including some other specified things like dependent care, etc. authorized and accounted by the university.
You sign the promissory note including a line indicating that you will use the money for required legitimate education expenses. They give you the money.
After that you're on your own. Hopefully you're not a degenerate gambler or closet alcoholic. Bending the rules to cover your required minimum payments on some old debt you can't discharge and leasing a civic because your beater fell apart and you need a car for rotations is within your power, but they can't change the budget to accommodate your expenses so you will have to save elsewhere. While technically not an education expense, the reality is that you will need to do these things and nobody gives a damn. In fact, defaulting on your credit card debt could damage your credit so severely that you are no longer eligible for your necessary grad plus loans. I don't think anyone wants that, and in reality the bank will be more than happy to give you more money than you really need that cant be discharged at 8.5%. My mortgage is dischargeable and only at 3.25%. They would never audit you because they don't care and it is in their best interest not to care.
Back in my day, when you could get government subsidized loans and defer them, as in zero interest until residency, nearly everyone, possibly everyone, I was in school with that had private sources of money (savings or parents) took out the maximum subsidized loans available every year and deferred them as long as legally allowed. I'm not aware of any rule that you couldn't borrow the money if you didn't need it. The university certainly knew your financial status from your fafsa. It's not clear that it was technically wrong at all either, though probably against the spirit of the program. Who is to say that you didn't use that loan money for tuition while using your personal cash to buy the new BMW or the trip to Vail. Everyone did it. And when the interest started accruing you paid it off. Not that I would do anything like that, I had lots of friends that did though. Once I took the .mil money, the loans were no longer available, not that I would take them of course.
 
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Starry said:
I don't think it's nonsense. The OP will not be using the loans for the cost of living while in school. He's using it to cover previous debts incurred before school. This is highly likely to be against the terms of his loan. Even if no one ever really reads all that fine print and there is a low risk of getting caught, it's still not advisable to do what the OP is considering.
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...so you think it would be advisable to hold on to $10,000 of debt at >20% interest without being able to pay any of it off for 5 years, rather than converting the 20% to 7% for the same amount of time? That's ridiculous.
 
Isn't money fungible? Couldn't you take $10,000 of living expense money, buy your friend's pencil (for school), sell it back to him for $10,000, and then use the $10,000 in sales proceeds (NOT the $10,000 in loan money, that was used to buy the pencil) to pay off the credit card loan?

If you don't like the pencil idea I am sure the collective SDN can come up with more creative ways to obfuscate where the money came from.

I mean, a dollar is a dollar, without identity. I hate it when grandma asks me where I "spent her $50 birthday gift". It went in the wallet (or bank) and got mixed in with the rest, duh.
 
As a finance major, I am saddened by the amount of bad financial advice here. You should absolutely minimize your loans with the highest interest rate. If that means paying off your credit cards with student loans, then you should do that. Even though you are not supposed to according to the terms, it's the most financially wise choice. People who are talking about things like bankruptcy don't understand how devastating declaring bankruptcy is for your financial future. Especially since you are going to pursue a career where you will be decently compensated and have money to buy nice things like houses and cars, any loans/mortgages you try to take out after having declared post bankruptcy will have astronomical rates. It's just not worth it.

I will say though that immediately paying off all your CC debt may not be advisable as you can wind up being actually broke if you use up all of your funds before your next loan disbursement. Budget out your life very carefully and decide how much per semester you can devote to paying down your CC loans.
 
sinombre said:
...so you think it would be advisable to hold on to $10,000 of debt at >20% interest without being able to pay any of it off for 5 years, rather than converting the 20% to 7% for the same amount of time? That's ridiculous.
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It's the financially the smartest choice, but is probably not the most legal one. Whether it's ethical is also debatable.

I just feel like dismissing concerns over legality is wrong. The OP needs to know that he's undertaking some risk, no matter how small. It's not a 100% free, "Pass GO and collect $200!" card.
 
Jay K said:
This was my plan in medical school and residency:

1) Stay childless and unmarried for the duration of this particular plan
1) Rent a local PO Box
2) Obtain a very low cost 24hr gym membership if the school/hospital does not offer a gym and/or showers
3) Have your bills sent to PO Box and/or family member's home and/or go paperless
4) Cell phone & laptop
5) Free wi-fi at school and hospital and/or starbucks, whatever
6) No apartment
7) Buy parking pass for hospital/medical school lot and live out of your car and/or hospital call rooms, lecture halls, study rooms, etc (rotate these locations)
8) Wear scrubs that are laundered for free
9) Laundromat once every other week to wash underwear, socks and dress clothes for rotations that require
10) Keep this on the down-low as you are essentially homeless
11) Attend conferences and lectures which provide free food and/or eat at the hospital cafeteria on the employee discount.
12) Go back to his/her place when necessary and/or priceline a hotel when need arises

PAY OFF ENTIRE CC DEBT with your loan money immediately.

You will only have to do this your first year, but if you've gotten the hang of it you might be tempted to continue for as long as the cost-savings are realized. The highest living expenses are usually housing and utilities of which you'll save a bundle. All you'll have to pay for is a cell phone - no rent, gas, electric, cable, water, etc.
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If you do go through this route, you should make a documentary of your experience.
 
reese07 said:
About 21%
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I would cover it with loans.

I'm not sure about this whole "some expenses are okay, but others are not" business others are talking about. Why is credit card debt specifically excluded? Are pre-existing mortgages and car loans excluded? Paying newly incurred, monthly CC bills? Child support? I don't buy it.
 
Starry said:
It's the financially the smartest choice, but is probably not the most legal one. Whether it's ethical is also debatable.

I just feel like dismissing concerns over legality is wrong. The OP needs to know that he's undertaking some risk, no matter how small. It's not a 100% free, "Pass GO and collect $200!" card.
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So I'm wondering where you would draw the line for not using loans for credit card payments. I (and I'm sure others here) pay off my utilities (phones, internet) and groceries with my credit card. I get points so it's better for me to use a CC than pay with a debit card. Would it be illegal to pay off my CC with loans then? I also use my CC to pay for non-living expenses, so can I only legally pay for a portion of my CC bill?
 
As I noted above, your university can add certain things like dependent care to its official COA for you. There is a list of acceptable expenses that can adjust the budget. Another example is a one time computer purchase. Some things, like car loan payments and consumer debt (credit cards, etc.) are specifically excluded from their authorized list of expenses that can adjust your COA. When you sign the loan docs you acknowledge that the money will be used for legitimate education related expenses.
How you interpret that and the strict legal interpretation may not be the same, and nobody knows, and nobody cares.
If they didn't care when the government was paying the interest on the loan for you, why would they care now?
If you have no car and you need a car for rotations you buy one. If grandma gets deathly ill you fly out to see her. Where does that money come from? Hmmm? You do have to adjust your own budget to afford those things, or you're in big trouble.
Your medical school's website probably has this info on it. It's certainly online.
 
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A lot of the schools I've checked have nearly 2k in "personal expenses" added to the estimated tuition. On top of that, a lot of the schools will say something like "room and board estimated to be 1200/month for the 9 months of the first year" then budget 17,000 into their COA instead. Why would buying condoms and sour patch kids be allowed but paying off CC debt used to get into medical school in the first place not be allowed? OP, I don't doubt that you'll be able to find more than enough money to pay off the CC debt over 4 years if you budget wisely.

...You might have to grow your own food and start herding cattle though.
 
I'm confused, you can't just hang around and let your credit card interest pile up - you have to make payments. Do credit cards let you defer payments like student loans? I didn't think that was possible. If it's not possible and you are still responsible for those minimum payments where is the money supposed to come from if not from your med school loans? I have some private loans from undergrad that I'm not sure I'll be able to defer again while in medical school...will I still be able to make those payments with my COA loans?
 
kyamh said:
I'm confused, you can't just hang around and let your credit card interest pile up - you have to make payments. Do credit cards let you defer payments like student loans? I didn't think that was possible. If it's not possible and you are still responsible for those minimum payments where is the money supposed to come from if not from your med school loans? I have some private loans from undergrad that I'm not sure I'll be able to defer again while in medical school...will I still be able to make those payments with my COA loans?
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Well, the assumption is that it's your problem to deal with, not theirs. You are probably expected to work or otherwise have an additional income source.

Sent from my SGH-M919
 
LuciusVorenus said:
A lot of the schools I've checked have nearly 2k in "personal expenses" added to the estimated tuition. On top of that, a lot of the schools will say something like "room and board estimated to be 1200/month for the 9 months of the first year" then budget 17,000 into their COA instead. Why would buying condoms and sour patch kids be allowed but paying off CC debt used to get into medical school in the first place not be allowed? OP, I don't doubt that you'll be able to find more than enough money to pay off the CC debt over 4 years if you budget wisely.

...You might have to grow your own food and start herding cattle though.
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Just because the rules don't make sense doesn't mean they aren't the rules. Do whatever you need to do. Just don't go telling your financial aid counselor or The Man that you're using your loan money to pay off consumer debt.

Sent from my SGH-M919
 
NickNaylor said:
Just because the rules don't make sense doesn't mean they aren't the rules. Do whatever you need to do. Just don't go telling your financial aid counselor or The Man that you're using your loan money to pay off consumer debt.

Sent from my SGH-M919
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I won't tell if you won't. :X
 
If you went and asked the financial aid counselor how to pay your credit card, they would mostly likely close the door and then tell you in private to use your loans, just like if you didn't have a car they would tell you to buy/lease one with your loans. Why do you think COA is so high and they overestimate on books/equipement?

The talk they gave us at the beginning was basically "officially your supposed to do this...., however we understand that you have no other income, so use the loans, we give you extra on purpose. Just know we can't increase your COA officially for X so you'll have to budget."
 
kami333 said:
If you went and asked the financial aid counselor how to pay your credit card, they would mostly likely close the door and then tell you in private to use your loans, just like if you didn't have a car they would tell you to buy/lease one with your loans. Why do you think COA is so high and they overestimate on books/equipement?

The talk they gave us at the beginning was basically "officially your supposed to do this...., however we understand that you have no other income, so use the loans, we give you extra on purpose. Just know we can't increase your COA officially for X so you'll have to budget."
Click to expand...

This doesn't disagree with anything said here. It is still not allowed per typical loan terms, but the likelihood that you will ever be caught is essentially zero unless you're a complete ***** or have terrible luck.

Sent from my SGH-M919
 
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