Ok - I feel foolish for not knowing this but, folks on CC in the know always post that kids may take out a $5,500 Federal student loan on their own. We have been lucky enough to have our kid at our State Flagship and been able to foot the bill. But said child would like to study abroad, which is outside our budget. So can she just apply for a federal student loan? Will the fact that we, double income parents of this student would not be deemed “needy” disqualify her from the federal student loan program? Does she (aka we) have to fill out the FAFSA for her to apply for a federal loan? or should we just seek a private or parent plus loan? I just don’t know if she would be eligible for a federal loan as I thought they were reserved for students who had more need.
Also, as she is likely to be able to graduate early, we would likely pay all or most of the loan off in the spring of next year - are there pre-payment penalties?
You need to complete a FAFSA for her to be able to get that Direct Loan. There are NO prepayment penalties.
But you gotta do the FAFSA. Even Bill Gates could,get the Direct Loan.
When is she doing the study abroad?
The federal direct loan has better rates and payment terms than private student loans or PLUS, and PLUS also requires a FAFSA.
Well we are not Gates family but glad to hear that we will qualify - or she will! And I knew they had better rates than the parent or private loans, I just thought it was too good to be true that she would qualify for the Federal loan. I hate to have her borrow at all, but for an extra experience that she wants to do, it is a practical solution.
She is going to the South Pacific! A remote spot, once in a life time opportunity. Glad we can make it work.
When is she going? And what year in college will she be? Junior?
If so…juniors get $7500 in Direct Loan money for the year. But I believe it would be disbursed to her half at a time.
If she is going fall 2018 term…you might want to file a 2017-2018 FAFSA ASAP…and have her apply for the Direct Loan for THIS academic year…so you will have the money up front.