Question about financial aid award and tuition payments

dababy123

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    Hello,

    I will be starting dental school in the fall and have gotten my financial aid award offer. I had some questions in my attempt to save as much money as I can (every dollar counts). I understand that the school has offered me an award amount that I may need for the whole academic year. The school I am attending has tuition due dates for both Fall and Spring (in December) so I am wondering if I can just accept a partial amount of the award needed to pay off Fall tuition & expenses and then accept more of the award come December when Spring tuition is due and for what I need for expenses that semester. My logic behind this is to not take out the money I need for Spring yet because the interest will just begin to build (interest for ~4 months). So basically my questions are am I allowed to pull out more loans at any time during the school year (assuming I dont go over my full award offer) & am I allowed to return loans back that I actually didn't need without a penalty? Would I have to pay the interest that build up for x amount of weeks, will I get back origination fee of loans, typical time frame where I'm allowed to return, etc. Sorry if my questions are confusing, just my first time borrowing loans. Thanks a ton!
     

    S_Diamond_DDS

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      My school disperses it’s loans each quarter rather than sending the full year’s loan at once, I’m guessing this is how most schools do it. You can take as much as you want out per quarter (you specify to your financial aid department) up to the maximum amount. Then if you need more you just have to request it from financial aid. You can also return funds at the end of the quarter. To my knowledge there is no penalty for doing this.
       

      dababy123

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        My school disperses it’s loans each quarter rather than sending the full year’s loan at once, I’m guessing this is how most schools do it. You can take as much as you want out per quarter (you specify to your financial aid department) up to the maximum amount. Then if you need more you just have to request it from financial aid. You can also return funds at the end of the quarter. To my knowledge there is no penalty for doing this.

        Thank you, that clears up alot!
         
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        CaliforniaCrentist

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          I believe there is a certain time frame from the date of disbursement that you can return money that you don't need. I significantly reduced my second quarter disbursement. I would rather dip a little into savings rather than take out too much money this early on since it'll start accruing interest
           
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          Firik

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            You accept the fafsa package in summer before school starts; make sure to account for Fall, Spring and Summer semesters (in my case). Then, once school starts they will disperse only the amount for that semester. Another word, once you start Fall, the Fall amount will be dispersed while Spring and Summer aids put on hold (no interest occurs on that). So, you not getting charged for accepting any amount, only when its get dispersed.
             
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            dababy123

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              I believe there is a certain time frame from the date of disbursement that you can return money that you don't need. I significantly reduced my second quarter disbursement. I would rather dip a little into savings rather than take out too much money this early on since it'll start accruing interest

              Great! It'll be hard to gauge how much money Ill need since its my first quarter going into dental school. Good to know there is a time frame to return w/ penalty. Vise versa, if i accept less than the full award offer, I can always pull out more right?

              You accept the fafsa package in summer before school starts; make sure to account for Fall, Spring and Summer semesters (in my case). Then, once school starts they will disperse only the amount for that semester. Another word, once you start Fall, the Fall amount will be dispersed while Spring and Summer aids put on hold (no interest occurs on that). So, you not getting charged for accepting any amount, only when its get dispersed.

              Thank you for your response! And once that gets dispersed and I find out after 2 months of dental school I need more money, I can always pull out more money from the award right?
               

              Firik

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                Thank you for your response! And once that gets dispersed and I find out after 2 months of dental school I need more money, I can always pull out more money from the award right?

                Unfortunately, not. Once you accept the amount that is final for that year (unless you do write up and fill out a form requesting more money, but you need to have a legitimate reason). So, you can always accept more award, and then if you decide you don't need it, just send to your fafsa coordinator saying "I don't need of this loan for this amount" and they can reduce the loan. So, it's the other way: accept more and decline later.
                 
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                pookey123

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                  accept all of it. then you have a roughly 2-3 month period where you can return excess loan funds with no penalty or interest.

                  The way it works in general, at the beginning of the semester fin aid is dispersed, I get the full amount in my bank (minus tuition which is deducted) through direct deposit. Fin aid sends an email (my school sends 2-3 reminders) stating that you can return excess loan funds and how to do it. I usually return the funds about a week before the deadline because why not, (no interest is paid on the funds that you return). So if you're frugal, you'll be returning a portion of your loans every semester.

                  sometimes fin aid office disperses late so keep that in mind. Also, it is much harder to request more loans afterwards. so you want a margin of safety, so usually you should accept the full amount and just return what you don't need, rather than try to estimate how much you'll actually need. especially with covid you don't know what's gonna happen so I highly recommend you accept the fin aid package in full. (also plan ahead for how your school handles summer; I think schools handle it differently but in general Spring Semester is often spring + summer and runs longer than fall semester)
                   
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                  CaliforniaCrentist

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                    Unfortunately, not. Once you accept the amount that is final for that year (unless you do write up and fill out a form requesting more money, but you need to have a legitimate reason). So, you can always accept more award, and then if you decide you don't need it, just send to your fafsa coordinator saying "I don't need of this loan for this amount" and they can reduce the loan. So, it's the other way: accept more and decline later.

                    It wasn't final for the year for me. I lowered my spring quarter disbursement since I needed more for fall quarter for moving expenses etc.
                     

                    dababy123

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                      accept all of it. then you have a roughly 2-3 month period where you can return excess loan funds with no penalty or interest.

                      The way it works in general, at the beginning of the semester fin aid is dispersed, I get the full amount in my bank (minus tuition which is deducted) through direct deposit. Fin aid sends an email (my school sends 2-3 reminders) stating that you can return excess loan funds and how to do it. I usually return the funds about a week before the deadline because why not, (no interest is paid on the funds that you return). So if you're frugal, you'll be returning a portion of your loans every semester.

                      sometimes fin aid office disperses late so keep that in mind. Also, it is much harder to request more loans afterwards. so you want a margin of safety, so usually you should accept the full amount and just return what you don't need, rather than try to estimate how much you'll actually need. especially with covid you don't know what's gonna happen so I highly recommend you accept the fin aid package in full. (also plan ahead for how your school handles summer; I think schools handle it differently but in general Spring Semester is often spring + summer and runs longer than fall semester)

                      Ok that makes sense. Thank you! Ill reach out to my FA advisor just to double check. Appreciate the reply.
                       
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