<p>Is it wise for our son to accept all the financial aid offered, even if in the end he does not need it? In other words, he plans to work and put money towards college to eleviate the amount of loans. Should he accept those loans now though, and take them. If so, then what? Keep that money in an account to the end of the year and then pay towards the loan what is left right away? Not sure that I am making any sense.</p>
<p>He has been offered Perkins and both subsidized and unsub loans. </p>
<p>Lastly, registration/orientation is tomorrow and it sounds like they start the loan process then. Should he just go ahead and apply for them all? Will it hurt in anyway?</p>
<p>Thanks in advance.</p>
<p>The only downside to accepting the subsidized Stafford loan is that you pay a one-time 4% initiation fee ($140 on $3,500). Interest does not start accruing until he graduates (or leaves for other reasons). So if having $3,500 in cash insurance against future financial problems is worth $140 to you, then it makes sense.</p>
<p>There is no initiation fee for the Perkins loan, so why not?</p>
<p>He will start accruing 6.8% interest on the unsubsidized loan as soon as it’s disbursed to the college (i.e., half at the beginning of each semester). Plus there’s a 4% initiation fee. So it probably doesn’t make sense.</p>
<p>BTW, you don’t get a check for the amount of the loan. Its paid directly to the college, and reduces what you need to pay.</p>
<p>In our case, DD accepted the subsidized Stafford and the Perkins. DW and I are depositing one-twelfth of the loan amount in a savings account for her every month, since the loans are reducing what we would otherwise be paying on the school’s monthly payment plan. But this may or may not be the right strategy for you.</p>
<p>^^ I thought the fee for the sub loans was reduced to considerably less than 4% - I think we only paid 1/2% or maybe 1%, certainly nothing anywhere close to 4%.</p>
<p>In the OPs position, I would accept the sub loans but not the unsub loans (assuming everything can be paid for without the unsub loans).</p>
<p>^ It’s .5%. On July something of this year, it goes up to 1%.</p>
<p>^ that is correct. I was wrong. It used to be 4% and I was using an outdated web page. my bad, bad, bad.</p>
<p>Thank you so much! I just read that he was supposed to do some online loan counceling with the Perkins and Sub loans before orientation/registration…which is tomorrow. Hoping for the best! I have a feeling we are going to learn a lot tomorrow about how this works, and some may be in a painful way. 
</p>
<p>Hopefully that was just a suggestion and not manditory to have done by then. I think he went online and accepted everything, but he can go back and change it. We will unselect the unsub one. That one isn’t a lot and I don’t think he will need it. He will keep the scholarship, grants, work study, Perkins and Sub. Loan. </p>
<p>How does that work with the July 1st date. Do we have a way of making sure we are in before that, or is it when it is dispersed?</p>
<p>It said something about a Master Promise Note, too. Hopefully we don’t mess all this up too badly! I figured that was what tomorrow was about. To get him on track with everything for Fall semester. To educate us and give us a timeline and advice on how to do this. This is getting worse then filing taxes…which we had to go through verification even though our FAFSA was linked to the IRS. They still don’t show that as all complete even though we sent it months ago. :(</p>