A few questions about loans...

Paying for College
1

<p>Here's my situation:
Being a first generation student, I'm kind of unsure on how loans work. I took out the Federal Direct Student Subsidized Loan, Federal Direct Student Unsubsidized Loan, and the Federal Perkins Loan. I got around $13,800 in scholarship and grant money. And with those three loans, I took out a total of $6,265, leaving me with an FA package of $20,065. </p>

<p>I'm going to a SUNY school, so tuition is only $6,815 and room and board is aproximately $11,245. Those two added together comes out to $18,060. </p>

<p>So on to my questions.
-When I get the official bill, what happens? Is part of my bill automatically paid due to the scholarships and grants?</p>

<p>-For the parts of my bill not paid by the scholarships and grants, I use the money I took out in my loans. How does that work? Does the government send over the money to the school directly? Or do I somehow get possession of this money and pay the school with it?</p>

<p>-Can I use the loan money to buy books? How exactly do I do that? </p>

<p>-I feel like I took out more money than I need (I was very paranoid that I wouldn't be able to pay for school, hence why I took out all that money in loans...). Is there some way that I can just not use the money from my Federal Direct Unsubsidized Loan? And if I don't, is it automatically repaid or something?</p>

<p>I'm sorry if my questions are really obvious and stupid! No one in my family has any experience with higher education and pretty much all my friends are getting their parents and grandparents to pay for their education, so I'm all alone in Student Loan World, haha.</p>

2

<p>The school will refund the surplus in loans to you. You are then free to either spend it how you like or return it to the lender and have less to pay off in the end.</p>

<p>If you need books, by all means, use the money for that. However, books are not $2,000 (especially not if you buy used, which you should almost always do) and I would recommend you return whatever is left after books are paid for.</p>

3

<p>Yeah I know I can save tons of money by buying used books over the new ones, so that’s definitely what I’m planning on doing. </p>

<p>But how do you spend the loan money? Does the school give me the money I took out in loans? I just don’t understand that part…</p>

<p>But thank you, CIA, for your help!</p>

4

<p>They give you a check.</p>

5

<p>Sometimes you can’t actually get the check in time to buy books.</p>

6

<p>For their student ID cards, some colleges use these kind of multipurpose debit/student ID cards. If you want they will transfer your refund directly to the card and you can use it like any other debit card. It makes getting your refunds very quick and efficient… but there is something that creeps me out about it.</p>

7

<p>^^^</p>

<p>Very true. But, I don’t know if they’ll do the transferring to the “card account” in time to buy books. Some schools might. My kids’ school waits until about the second week of school (to make sure all of their costs are covered), before they release any money for any student use.</p>