Question about accidental loan....

<p>I am an occasional visitor to this site and I believe there are a few of you who may work at schools handling aid/scholarships....</p>

<p>I was trying to apply for a parent plus loan (knowing based on my credit file that I would not get approved) and my son would then be eligible for additional unsubsidized loans. I apparently did not pay attention to the fact that 2014/15 is not yet available. I know now that I can apply for the parent plus loan beginning 4/14/14.</p>

<p>Well apparently my son now has a new $1500 loan for the current school year. He does not have anything unpaid for this academic year.</p>

<p>My question is.....does it matter how the money is used?</p>

<p>DS was speaking with an advisor and he is going to have to take one or two classes this summer or he will be short a few credit hours needed to graduate in 2016. </p>

<p>Can this new loan be used to pay for his summer school classes which would be at the local community college?</p>

<p>If you are saying that he didn’t take all his Stafford loan in 2013-14, and now has borrowed this $1500, then yes, he can use it for whatever he wants. If you don’t want the loan, he doesn’t have to accept the disbursement.</p>

<p>Thanks twoinanddone. I thought I was applying for the 2014/15 year. The new loan is now listed on his 2013/14 aid letter and, minus a $14 fee, the funds have already been deposited into my checking acct (he does not have a bank acct). That’s how I found out about the loan…I logged onto my bank acct and saw a deposit from his school. </p>

<p>It will be used for the summer classes and books. We will accept it because the summer classes are an unexpected expense right now because I am only working part time at the moment. </p>

<p>I just wanted to make sure that the funds were not required to only be used at the school where he is enrolled full time. </p>

<p>For student Direct loans if you return within 120 days, you get your fees and whatever returned, I believe. Do check what the rules are for PLUS. Be aware that the interest rate for PLUS are close to 7% and it starts cranking as soon as distribution is made.</p>