Only Unsubsidized Stafford despite Demonstrated Need?

Daughter attends a (CSS Profile) meets-full-need college and receives a generous school grant. FAFSA confirms we have need.

We do take out Stafford Loans to make up the difference but it appears that they are only Unsubsidized. Does this sound right?

She took out $5500 (all Unsubsidized) for Freshman year and now $6500 (all Unsubsidized) for Sophomore year.

In order to qualify for Subsidized Stafford loans, do you need to be in Pell Grant territory or do most families qualify if they aren’t full pay?

Thank you.

@OceanIsle You/your daughter most likely will find the best answer and information on the applied Federal Student unsubsidized/subsidized split, as determined by the Office of Financial Aid, by speaking with them directly. Just give them a phone call and they surely will be happy to provide specific information on how you daughter’s federal loan elegibilty for her sophomore year has been calculated. Best of luck and success!

Are you using the Direct Loans to cover your family contribution? Or are you using the Direct Loans to cover tuition, fees, room and board.

In other words…does your child’s need based award meet her need…but still leaves you with a family contribution?

@thumper1 , yes. The school meets a lot of the need and has a high sticker price but we still have room, board, books and some tuition expenses that are required out of pocket. Those out of pocket expenses are well above the $5500-$6500 Stafford loan amounts per year.

@hpcsa , yes, I did call them today but the rep didn’t have a clear understanding of the methodology and said she will pass it along to the officers and someone will get back to me. I’m just trying to gain an understanding on my own so that I can figure out whether I need to be assertive or whether I could have accidentally filled something out incorrectly. It’s possible it’s all accurate as-is.

If the school has met your full need…then the balance of your costs are YOUR expenses, not financial need. Therefore, your loans would not be subsidized.

You say the school meets full need for all, right? Schools that do that meet full need for their full cost of attendance, including room, board, fees, tuition, personal expenses…the whole thing. It must be that your need was met according to their calculations using their institutional money.

Any balance that was your family contribution is not considered “need”. That is considered what your family should be paying. If the school met your daughter’s full calculated need (per the school), then the family contribution is what would remain.

That would not get a subsidized loan.

We also get the unsubsidized loan. I pay all the interest in real time (virtually nothing) so S will graduate with only the principal as debt. Hopefully we’ll surprise him and pay a chunk of that off as a graduation gift.

@thumper1 , that makes sense. Part of the financial aid package presented by the school included the Federal Loans as a portion of how the school meets the need, so that caused some of my curiosity.

But I suspect that their grant brings our need down to a level that disqualifies the unsubsidized loan, and I’m not complaining. The school is generous.

For my own knowledge though, I do wonder if there is a threshold where a family is considered in the subsidized/unsubsidized range, mostly bc S20 won’t attend a meets-need college next year. It will be interesting to see if he qualifies for subsidized.

Your son might qualify for a subsidized loan. Because you will have unmet need probably if his college doesn’t meet full need.

But if he gets a nice juicy merit award that brings down your need…well…you might not get that subsidized loan.

You have to have unmet need to get a subsidized loan.

We did the same as the poster upstream. We “subsidized” the loans by paying off the interest every year. It wasn’t a lot of money.

The school’s Financial Aid Cost of Attendance minus the Expected Family Contribution (per FAFSA) minus all grants/scholarships minus any Federal Work Study equals Remaining Financial Need for determining subsidized loan eligibility. If there is no remaining need, the loan is unsubsidized.