<p>As we are trying to figure out how to pay for college, I have figured out the following</p>
<p>The first two years, we are planning to pay for college from a combination of savings and tuition payment plans. The second two years, we will start looking at loans.</p>
<p>Regarding stafford loans, we are a bit confused. We were told by our guidance counselor that a student can take out up to $27,000 in student loans. However, looking at the stafford loan website, it kind of looks like the limit is only $2,000 for unsubsidized and there is a limit per year. On another page, there is a limit per year of $5500. </p>
<p>My questions are the following:</p>
<p>Are unsubsidized loans limited by EFC?</p>
<p>If a student does not take a student loan the first two years, are the limits for those years rolled over into future years? That is, will she be able to take say $10,000 in junior year? or will she still be limited by the annual limit per year. </p>
<p>I would prefer that she hold off on taking out loans to save on the interest until we run out of savings. However, if she would lose the loan amounts every year, I would prefer that she take advantage of the loans instead of having to take out more expensive private loans later.</p>
<p>Also, curious how full pay people have managed it. Any suggestions would be welcome.</p>
<p>Stafford loans can be subsidized or unsubsidized. Subsidized required need. For a freshman the maximum total Stafford is $5500 of which up to $3500 may be subsidized (if there is need). For a sophomore the maximum is $6500 of which up to $4500 may be subsidized. For 3rd year and up the maximum is $7500 of which up to $5500 may be subsidized. The aggregate maximum Stafford loans for a dependent undergrad student is $31,000 of which up to $23,000 may be subsidized.</p>
<p>The maximums are by year. If a student does not take the loan one year they cannot add that amount of loan to the next year.For instance if they do not take any out freshman year they are still limited to $6500 sophomore year.</p>
<p>swimcatsmom. Thank you for the explanation. Now if she does not qualify for subsidized, will she still be allowed to take the limit for the year, say $5500 or will she be limited to only $2000.</p>
<p>If she does not qualify for subsidized, she would be able to take out the max for each year ($5500 fresh, $6500 soph, $7500 jun & sr) as unsubsidized. Interest accrues on these from the moment the money is borrowed.</p>
<p>But-- she would have to file the FAFSA each year to be able to take out the unsubsidized Stafford loan, even if she doesn’t have any “need”.</p>
<p>The first two years, we are planning to pay for college from a combination of savings and tuition payment plans. The second two years, we will start looking at loans.</p>
<p>If the loan limits for years 3 & 4 will not be enough, then perhaps a Stafford should be taken out for year 2? I don’t know how late in the school year a Stafford can be taken out, but if it’s possible to take one out during the second semester of soph year, that would lessen the amount of interest (instead of taking it out summer before soph year.)</p>
<p>That’s an interesting point. I have to do some research to see if it’s possible to take the loans out later in the year, say as if for the spring semester.</p>