Need help in how to calculate interest and how much I have to pay back

<p>I will be attending Stony Brook this fall and here's a brief description of my financial aid package
COA is 23,074, and I received 11,925 in grants and scholarships.</p>

<p>The other 11,149 I have to take loans or pay back.</p>

<p>federal subsidized loan: $3500 a year(1750 per semester), I understand for this type of loans, the gov't pays the interest rate, so basically I have to pay back $3500 and thats it correct? Also please clarify, I don't have to pay anything until 6 months after i graduate or leave the college correct, that's when they start billing. Other than that, they just bill you every semester</p>

<p>federal unsubsidized loan: 2000 a year (1000 per semester), for this loan type I have to pay back the 2000 plus interest which is 3.86%
How do you calculate the interest, is money being compounded monthly/weekly i really have no idea. </p>

<p>After the scholarships and loans, i still have to pay back 5649. Let's say I don't decide to get a loan, can I pay this money back after 6 months after graduation like with the loans, or is it like directly billed and you MUST pay?</p>

<p>If not, are there other types of federal loans i can apply for to get more money. For example I heard undergrad freshmen are able to get an additional 4000 in loans but i don't know where to apply for it</p>

<p>Thanks in advance!</p>

<p><a href=“http://www.direct.ed.gov/”>http://www.direct.ed.gov/&lt;/a&gt;&lt;/p&gt;

<p>Basically, you have ten years to pay these. If you take the full 27k, (remember, it adds to four years of loans, different max each year,) it comes out to about 300/month. There is a calculator link on that page.<br>
Subsidized: for students with demonstrated financial need, as determined by federal regulations. No interest is charged while a student is in school at least half-time, during the grace period, and during deferment periods.
Unsubsidized: not based on financial need; interest is charged during all periods, even during the time a student is in school and during grace and deferment periods.
</p>

<p>

Does the school offer you the Direct Loans & Perkins Loans? After these loans, your parents can get Direct PLUS Loans to cover the remaining of $11,149. See <a href=“https://studentaid.ed.gov/types/loans”>https://studentaid.ed.gov/types/loans&lt;/a&gt;&lt;/p&gt;

<p>You haven’t mentioned your parents in all this, but from the numbers you gave, it sounds like you are a dependent student.</p>

<p>1) You could get $4000 more in loans if your parents applied for a Plus loan and were denied a loan. If your parents are approved for the loan, that Plus loan would be in their name and not yours. If your parents don’t want to apply for a Plus loan, you cannot get any additional loans unless they co-sign for you. If they don’t want Plus loans, they probably also won’t want to co-sign private loans for you.</p>

<p>2) Federal loans use simple interest, so the interest does not compound, which is the only nice thing about them.</p>

<p>3) The subsidized loans do not accrue interest while you are in school, but when you get out, they will start accruing interest. So if you had $3500 you could use to pay it back on graduation day, that’s all you’d have to pay. But if you pay it back over 10 years, you will pay a good chunk of interest on it.</p>

<p>4) The money that you don’t get loans for, you have to pay up front in order to register for the semester. So if you took the $5500 in loans, your remaining expenses are <em>estimated</em> at $5649 for the year, but that includes both direct costs (things the school will bill you for) and indirect costs (things like textbooks and incidentals that you will pay for yourself over the course of the year)</p>

<p>The direct costs for Stony Brook are $20,250. If you subtract your grants/scholarships and $5500 in loans, that leaves $2825 that you are going to be billed for. Half of that will be due sometime before fall classes begin (usually due around early August, but it depends on your school’s calendar) and the other half before spring classes begin. You MUST pay or you will not be allowed to register for classes. Most schools have a payment plan that will allow you to pay in monthly installments instead of two lump sums, but there is normally an additional (small) fee for this.</p>

<p>5) I would strongly suggest you avoid taking $11K in loans each year, even if you can get them. Can your parents help at all? Do you have any money saved? Do you have a job? Can you get one for summer? Try to earn as much of that $5649 as you can! Will you work while in school? Does your package include work study?</p>

<p>Here’s what you need to come up with to start school, to cover your first semester. (You’ll have to come up with this again in December or January to cover second semester.)<br>
$1413 for the remainder of your direct expenses not covered by your financial aid
enough money to buy/rent textbooks – they estimate 450/semester but you can do some bargain hunting on that
Enough money to travel to school
Enough money to equip a dorm room – really you probably don’t need to buy anything more than twin XL sheets, but you may want some other items
Enough money for incidentals along the way (laundry, toiletries, etc.) - at least enough to get you through until you start bringing in some income from a work study or other job
Enough money for “surprise” expenses like this one: “All resident first year students are charged an additional fee for required opening weekend meals.”</p>

<p>You may be able to reduce the $1413 amount by choosing cheaper housing (ask for a triple) or meal plan than the one they assume in their computation. </p>

<p>If anyone asks what you want for graduation, think about things you will need (bedding, dorm items, Amazon gift cards for textbooks, etc.)</p>

<p>There’s a good loan calculator here that you can use to try out a few scenarios:
<a href=“Loan Payment Calculator - Finaid”>Your Guide for College Financial Aid - Finaid;

<p>Just for clarification:
My parents don’t have the requirements to successfully get the Parent PLUS loans and also i was awarded $0 dollars for the Perkins loans.
This means i have to pay 2825 a year.
So, every year the COA will change and I have to apply for the FAFSA every year and the amount awarded every year is different?
Im in the process of looking for a job and also will look for student employment in SBU. I plan on lowering my COA by living in the corridors style dorms or the triples and buying used books. I can also take out the transportation costs since I will be visiting home only during the breaks.</p>

<p>

If they are willing to apply, and are rejected, that will qualify you for additional Federal Direct loans. These will be unsubsidized, and will begin accruing interest from the day they are disbursed, so be careful not to take more than you really need. That said, if you don’t have any savings, you may need to take a bit more the first year to “bootstrap” you and help you get started with textbooks and other necessities you need as you start school, with the idea that your earnings will help you cover those things for future semesters. Were you awarded Federal Work Study? </p>

<p>

</p>

<p>It means you have to pay approximately $2825 directly to the school this year. On top of that you will have to pay for your other indirect expenses (books, travel, etc.). The $2825 will probably go down a bit if you get placed in a triple or other lower-priced dorm room. </p>

<p>

</p>

<p>Yes. </p>

<p>Wouldn’t I pay less (due to interest) if I didn’t take an additional loan and me and my parents help for the required 2825 this year
also i wasn’t a awarded any work study, so i’ll have to look for student emplyment</p>

<p>Yes, if your parents can help you and you don’t have to take loans, that is much better. </p>

<p>You could call and ask about work study also. It sometimes makes it easier to find a job.</p>

<p>Since I’m applying for financial aid every year, will the award amount next year be the same as now, or will it be more/less, does it depend on your gpa when your in college?</p>

<p>Financial aid will change depending on your family’s financial situation. Also, merit-base scholarship often requires you to maintain certain GPA.</p>

<p>Your (need-based) grant aid each year will depend on your family’s situation as reflected on that year’s FAFSA. If a school does not guarantee to meet full need, in theory they could give you much less grant aid in future years. Most schools will promise that if your financial situation remains the same, your aid should remain about the same for all 4 years. You should ask the school specifically if they promise that. </p>

<p>Because the federal loan limit goes up to 6500 for sophomore year, and 7500/yr for junior and senior years, your school may meet more of your need with loans in later years. So even if nothing changes with your financial situation and the school says your package will remain about the same from year to year, chances are they would give you 1K less in grant and 1K more in loans for next year, and 2K difference from your original aid package for junior and senior years. </p>

<p>You said you have grants and scholarships. Scholarship typically implies merit-based, and will typically have specific requirements (usually a minimum GPA) for renewal. You should ensure that your scholarships are renewable (not all are) and what the requirements for that are.</p>

<p>^ don’t be fooled. Loans do not meet need, they create debt. Keep them to a minimum.</p>

<p>From the school’s point of view, loans meet need. Schools will be anxious to give you more loans and less grant money. I agree that keeping them to a minimum is ideal.</p>