Financial Aid Package

Paying for College
1

<p>Hey guys.
I thought the whole Financial Aid process would end with my sending of the 2005 tax returns, but I just learned today I'm far from finishing.</p>

<p>I just checked one of my school's (USC) financial aid package, and this is what it turned out to be:</p>

<p>8k Dean's Scholarship
15k University Grants
2.1k Subsidized Federal Stafford Loan
.5k Unsubsidized Federal Stafford Loan</p>

<hr>

<p>26k TOTAL (I expected a LOT more loans.)</p>

<p>47k is the estimated total cost of enrolling, so that means my parents have to pay 21k, correct? </p>

<p>What I'm curious about now is how do my parents pay for this? Our EFC was about 20k on FAFSA (so this package is totally awesome). But do my parents have to pay 21k every year in one lump amount? Can my parents take out more loans (maybe 10k~ ..I don't know)? Can I take out loans? Basically, what do I do from now? </p>

<p>Thanks for everything! And sorry if I sound like a total idiot -- I'm honestly clueless. Once again, THANKS!</p>

2

<p>Call to your fin aid office and talk to them. Yes, your parents can take plus loans or any other ones, like remorgage your house etc.
You most likely have to have cosigner for any loans of your own.
Some schools will have montly payments options, some by term/semester.</p>

3

<p>The estimated cost of attending USC is just that-- an estimate. You might find that it costs you less, depending on your housing and meal arrangements. </p>

<p>Here's how SC breaks it down:</p>

<h1>$33,888 Tuition and fees (12-18 units for two semesters)</h1>

<h1>$10,144 Room and board</h1>

<h1>$750 Books and supplies</h1>

<h1>$1,604 Personal and Miscellaneous</h1>

<h1>$580 Transportation</h1>

<h1>$46,966 Total (add $140 for your very first semester at USC orientation fee)</h1>

<p>So-- if you accept the pacage offered, they will get the ball started by telling you how to sign up for your student loans-- they will get transferred into your account quarterly. The Scholarships and Grants will also usually be transferred each quarter into (and then out of) your account to pay for most of the tuition (they giveth, and taketh away). And then your folks (and you) will have to fork over the balance due for tuition, and for your room/board, and for miscellaneous expenses like books.</p>

<p>They can take out a home equity loan, if available, or other loan to make up the difference.</p>

<p>So it's not like they cut a check to SC for 21K. Rather, they'll be cutting checks periodically as expenses come up throughout the school year. Typically quarterly for room/board and balance due for tuition.</p>

4

<p>(or, you could go to UCLA for about 21K total-- ) :)</p>

<p>Actually, since your EFC was 20K, you wouldn't receive any need-based aid from UCLA, and you'd have to pay the full 21K yourself. So the actual cost would be similar to USC for you.</p>

5

<p>I'm actually out of state, so the UCs would cost maybe 40k~.
Plus, I was rejected from UCLA. haha
I'm hoping for Berkeley, but whatever.</p>

<p>So it is possible to take out more loans to cover the 21k right? Say 10k worth of loans each year or something? These would be private loans I'm guessing?</p>

<p>Thanks for dealing with my ignorance. I truly do not know what's going on anymore.</p>

6

<p>Yeah-- you're responsible for repaying the student loans (Perkins and Stafford) after graduation. 11K after 4 years is very doable.</p>

<p>Your parents can get loans for the rest of the unmet need. They might be offered a federal Plus loan for this porpose, or they can get loans from any lender. Home equity line of credit is a good coice for many, since the interest is tax deductable.</p>

7

<p>Better ask and see how your loans will change over the years. Usually the loan amounts increase each year. Check with F.A. to see what the "typical" debt amount undergrads leave UCS with. Students should be forwarned - loans will usually rise, sometimes by quite a large amount.</p>

8

<p>are student loans usually fix or variable?</p>

9

<p>If we take a ~15k Parent Plus Loan, that's 60k over four years.
Is this an outrageous amount to borrow?</p>

10

<p>Eddieee,</p>

<p>As to whether or not $60,000 is an outrageous amount of money to borrow is a decision that your parents will have to make since they are the ones who will be borrowing and paying off the money. </p>

<p>If your parents are going to make you repay them for the plus loan then $60,000 is a lot of debt for a student to carry.</p>

<p>Tony,</p>

<p>Regarding student loans...</p>

<p>All Stafford Loans are either subsidized (the government pays the interest while you're in school) or unsubsidized (you pay all the interest, although you can have the payments deferred until after graduation). To receive a subsidized Stafford Loan, you must be able to demonstrate financial need.</p>

<p>With the unsubsidized Stafford loan, you can defer the payments until after graduation by capitalizing the interest. This adds the interest payments to the loan balance, increasing the size and cost of the loan. All students, regardless of need, are eligible for the unsubsidized Stafford Loan.</p>

<p>Starting on July 1, 2007, Stafford Loans allow dependent undergraduates to borrow up to </p>

<p>$3,500 their freshman year (up from $2,625). This is the last year that freshmen will max out at $2625.</p>

<p>$4,500 their sophomore year (up from $3,500)</p>

<p>$5,500 for each remaining year of your undergraduate education.</p>

<p>Independent students and students whose parents have been turned down for a PLUS loan can borrow an additional unsubsidized $4,000 the first two years and $5,000 the remaining years)</p>

<p>There is also a cumulative limit of $23,000 in stafford loans for undergraduate education. For independent students and for students whose parents were denied a PLUS loan the cumulative limit is $46,000.</p>

<p>Stafford Loans have a fixed interest rate of 6.8% for loans with a first disbursement after July 1, 2006.</p>

<p><a href="http://www.finaid.org/loans/studentloan.phtml%5B/url%5D"&gt;http://www.finaid.org/loans/studentloan.phtml&lt;/a&gt;&lt;/p>

11

<p>Sybbie, thanks for the great info. I know interest rates will rise (this month and again in June) thanks to Alan Greenspan's new replacement. Do you think there should be any rush to secure a loan if we decide on private loans before the new increase in interest rates?
(note: I may be confusing this with real estate interest rates, but I assume educational loans would be affected)</p>