PARENT PLUS LOAN (Was it really approved?)

Hi,

Earlier tonight my mother and I applied online for the direct parent plus loan. After the credit check was done it said that it had been approved. I’ve experienced a lot of let downs with loans this week, so I just want to make sure that that actually means that we have been approved for the loan? Has anyone been approved and then not received the loan? I’m a full time student with 16 credit hours. An email said something about having to check with the school before funds are added to my account. I applied for less money than the school offered me for that loan. I asked for $37,000 while the school offered almost $40,000 for that loan in my financial aid package but I don’t need the extra $3,000. Should I be concerned with not receiving the loan or is the credit check approval a good indicator?

Your mom is going to borrow $37k each year for the next four years?? That’s $150k in debt.

Plus, your FA pkg would already have about $5500 in loans…adding another $27k to the $150k

Who is going to be making those huge loan payments?

You may have had a lot of letdowns in the past week, but someone is going to be freaking out in a few years.

No, she’s only borrowing for this year. I plan to establish residency in the state that I am attending college, by living there during the summers so my tuition will only be half of what it is now. Combined with the scholarships that I already have for a program that I am in/will obtain for other programs that I am entering now, I shouldn’t need more than $5,000 in loans in each year and that’s just dependent upon outside scholarships. Seeing as I am a minor, I was unable to obtain my own loans and my mother couldn’t cosign for a loan. But anyway, you didn’t really answer my question, but thanks anyway.

To answer your question, your mother will have to complete the promissory note before the loan amount will appear in your student account, so follow up.

(It is a lot of borrowing. Make sure you understand all the terms)

Thank you. We completed the master promissory note already. I was just worried that it might get rejected or something by the school. We read all of the terms and conditions and do fully understand the extent to which this will affect us.

Yes, your mom was approved.


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Seeing as I am a minor, I was unable to obtain my own loans and my mother couldn't cosign for a loan. But anyway, you didn't really answer my question, but thanks anyway.

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No, it wasn’t because you’re a minor. Even once you’re 18 you’d still need your mom to help you get loans beyond the Stafford Direct loans.

The scholarships you have NOW may be based on being an OOS student. They may disappear or be reduced after you’re an instate student…

Is this school in Missouri? If not, where is it?

What scholarships do you have for frosh year? If your mom had to borrow $37k and this is a public univ, then it doesn’t sound like you were given very much merit.

Yes but after I become an adult I will have a better chance of being able to establish my own credit.

My scholarships are not based on being an out of state student, they’re from various programs that I’ve entered and they are not geographically based.

The school isn’t in Missouri, it’s in Boulder, Colorado.

My mother did a lot of overtime last year, which put her in a different tax bracket when she filed her income tax so it took away a lot of the merit-based scholarships and grants that would have been available to me otherwise. This coming year when I do my fafsa she will have returned to her past tax bracket, so I’m hoping that that will help a little bit with the cost.

You don’t understand. You won’t be able to establish the credit you need because you won’t be earning enough.

Why do you think you can establish residency at UC Boulder if your mom doesn’t move there?

How much does your mom usually earn?

I think you’re going to find that you’re going to have to borrow a lot every year.

What is your major and career goal?

You can’t establish residency for instate rates in Colorado. The rules are clear on the UC-Boulder website

http://www.colorado.edu/registrar/state-tuition/criteria-establish-residency

Criteria to Establish Residency
The specific requirements for establishing residency for tuition classification purposes are prescribed by state law. No person may establish domicile in Colorado solely for the purpose of changing a student’s classification for tuition purposes from out-of-state to in-state. An individual who seeks to establish domicile while a registered student is presumed to be seeking domicile solely for tuition purposes, which is an unlawful purpose, absent clear and convincing evidence to the contrary [Colorado Revised Statutes § 23-7-101-103(2)(e)].

Because Colorado law governs Colorado residency status, the fact that a student might not qualify for in-state status in any other state does not guarantee in-state status in Colorado. Moreover, it is presumed that a student classified as a non- resident at the time of matriculation who seeks to establish Colorado domicile while registered at CU seeks Colorado domicile solely for tuition purposes. The student can rebut this presumption and be deemed an in-state resident only by a showing of clear and convincing evidence of his or her eligibility for this status.

You must be a qualified person for at least one year to be eligible to establish a Colorado domicile and begin the one year domicile period necessary to qualify for in-state tuition. Adults, emancipated minors, graduate students or a married student are qualified persons.

You are eligible to establish domicile and begin the one year domicile period if you are at least 22 years old, are married, or are emancipated from your parents, grandparents and/or friends. Persons not so qualified are not emancipated minors and assume the domicile of their parents, grandparents, or court-appointed legal guardian.

Adult students cannot qualify for in-state tuition through their parents, with the following exception: Because in-state status may be lost after one year of domicile elsewhere, adult students less than age 23 may be able to qualify through their parents. Consult the Tuition Classification Officer for additional information.

My parents are considering relocating to Colorado, so there’s that. And if they choose not to do so, I do have the option of living in an apartment off campus where I can use to money from my part time job to pay the rent. Since they’re school-owned, the rent is much cheaper than if I were to rent another aparment. That was suggested to me by the financial aid department because living off campus is much cheaper for out of state students than living on campus is, especially when looking to establish residency.

Usually my mom makes around $37,000/year.

And I’m double majoring in biochemistry and spanish with a minor in business. My ultimate career goal is to become a dermatologist. Oh and I forgot to mention that I have enough credits already from various AP and IB courses along with the summer credits that I will be acquiring that I’ll be in my undergrad for three years at most and 2 if I work extremely hard and take 21 credit hours per semester rather than the usual 16.

You said parents…how much do your parents usually earn together?

Even if you lived off campus, if you stayed as an OOS student, your costs would still be VERY high.

You want to become a MD? Then you should NOT be borrowing anywhere close to this much as an undergrad.

oh good heavens, unless you’re some super genius, you will not be doing premed and graduating in 2 years.

What are your stats?

Seriously, you need to be better advised. You’re making some really risky decisions about debt, about being premed, and by your choice to double major. Plus the thought of you working so much to pay rent while being premed.

Seriously, this plan has more holes than Swiss Cheese.

I am the mother of a med student.

Where will you go to school the following year if your mom, who earns $37k per year, can’t qualify for another $37k loan?

What’s wrong with your in state option?

Your mom’s increase in income has nothing to do with a decrease in merit aid.

What are your stats?

Have you considered how large your debt will grow to in 4 years? In 8 years (if you make it through med school)? In 12 years (after residency)?

This does not sound like a smart plan.

mom2 is correct, it is very (very) difficult to become a Colorado resident for tuition purposes once you start as an OOS student. One way would be for your parent (either one) to move here and live for one year. So if your mother moved tomorrow, ran down and registered her car and got a Colorado driver’s license, housing, and a new job, you’d be good to go next August. Living off campus won’t do it, especially if you rent the apartment through the university as you have to be a student to rent an apt through the university, and if you are a student, then you are not here for ‘non-educational purposes.’ Read the statute above. You won’t be able to do it.

CU is a great school. I went there myself. It is too expensive for you, and while some programs are top notch, biochemistry and Spanish are fine at many other schools. In my day minors were not offered, and it was almost impossible to take a course in the business school if you weren’t in the business school as it was just too full. I don’t know what the situation is today, but I doubt you will be finishing a double major and a minor (from a different college) in even 3 years; 3 would be impossible. Summer school won’t be any cheaper.

Really, save your $37000 and go to your state school. Take $1000 of that savings and go to spring break in Colorado.

Thank you all very much for responding, but I wasn’t really looking for advice or your judgements about my personal decisions. I just wanted my question answered. My parents and I are very aware of what we’re doing. But again, thank you anyway for answering my question. Enjoy your evenings.

OP, please don’t make your mom take a loan the size of her salary each yr…this will cripple her financially in the future. Take a gap year and apply to more affordable (and likely even better) schools.

http://talk.collegeconfidential.com/parents-forum/1498510-read-this-before-you-take-out-a-parent-plus-loan-p1.html

http://talk.collegeconfidential.com/parents-forum/1796972-how-families-end-up-with-massive-student-loan-debt-p1.html


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My parents and I are very aware of what we're doing. <<<

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No, you don’t. Evidence is:

  1. You thought that you needed your mom for this loan because you’re a minor.

  2. you thought that you could “establish credit” once you’re 18 for future student loans

  3. You thought that you could get instate rates after you were at UC Boulder for a year.

  4. You thought you could get more aid next year since your mom’s income goes down, but you have two parents, what about HIS income. Sounds like the combined incomes will be too high for a Pell Grant.

  5. You don’t understand the consequences of undergrad debt when you want to become a doctor.

  6. You think that if your parents don’t move to Colorado, then you’ll just live off campus to save money and you’ll work to pay for that. But what will be paying for the OOS tuition, books, fees, and that off-campus option.

  7. you think you’ll graduate with a double major and a minor and premed in 2-3 years…and have a med-school worthy GPA.

  8. you did not have merit based aid taken away due to your mom’s overtime income.

All of the above screams loudly that you and your parents have little idea what you’re doing in regards to college decisions.

We’re not telling you this to be mean to you. We’re telling you this so you’ll avoid what may be one of the biggest mistakes of your life.

Okay, but please come back in a year and tell us how it all worked out.

Even if you do become a Colorado resident, the tuition at CU for instate is about $12-13k (it varies by major, the business school being the most expensive). Living off campus is still expensive (my nephew is paying $1000+ utilities per month this coming year, 12 month contract), so a very very conservative minimum is $25k. Where will this come from? If you get Pell, that will be about $6000. Now you need $19000. If you take the Stafford, that leaves $13000. Say you earn $5000 (a very generous estimate). You are still short $8000 (probably a lot more if you actually expect to eat and buy books).

CU is just an expensive school with very little aid for instate or OOS students.

@jzlacrosseplayer I’m glad you think you know what you are doing…but financially it seems that you don’t. And for instate residency status in CO it seems that you don’t.

But yes, your loan is likely approved. Contact the school about disbursement timetables and the like.

If you take $120,000 in plus loans over four years, your MOM’s loan repayment obligation will be $1400 a month which is most unreasonable on a $37,000 a year salary.

And keep in mind…if your mom does not qualify in subsequent years, all you will get is an additional $4000 in Direct loans.

Your likelihood of establishing residency in CO with your plan is zero. If your parents move there, it will take at least 12 months for residency to be established…so you would be laying OOS tuition for two full years…at least. In most cases, if you start as an OOS student at CO, that is your status until graduation.

Here is an option…see if you can defer enrollment for a year. Have your parents move to CO right now…like this week. Then a year from now you will have instate status, and will be paying instate rates.