<p>My son is receiving generous need-based aid from his college. The package includes two loans. We think we can swing the finances this year without using the smaller of the loans---but could that jeopardize next year's aid, if the school now has, in essence, proof that we can pay more?</p>
<p>No, unless this money you are using was not reported in your FAFSA or other documents. I’m not taking any of the loans offered to my daughters this year. Next year might be different.</p>
<p>Not that I know of, though who really knows for sure what goes on in a given fin aid office or a given fin aid officer’s mind. I would probably take any loans that are subsidized, put the into an interest earning account, meager as the interest rates are these days, Those proceeds do not count as assets on your financial aid apps as long as you keep the paper trail clear so one can see those are unspent (and replaced) loan proceeds. Your student can dip into these funds if things get tight rather than taking out an unsubsidized loan and also save a bit of origination fees. The money can be paid back with no interest or charges, if not used by the time the student graduates, or the student has that loan maybe at preferable interest rates to use in place of grad school loans which are NOT subsidized, usually have higher interest rates, and have origination fees. If your student pays back the loan at grad, she gets a little bit of interest bonus (celebrate at McDonalds, but hey, it’s something). </p>
<p>The reason I suggest this , is because these loans are a use 'em or lose them things in that there are annual limits. If these are Perkins loans, they are hard to get. If they are the Direct Student loans, you only get a certain amount on a subsidized basis each yerar, $3500 as a freshman, for example. Don’t use it, you can’t ask for it for us senior year in addition to the senior allotment. S</p>
<p>Thanks for the reassurance, twoinanddone and cptofthehouse!</p>