Student Loans

Can I take out a student loan even if I have a decent amount in a savings account? Or would I have to use up the saved money first?

I'm planning on going to a veterinary school after I finish up my undergraduate education.  I haven't taken out a student loan yet and have been using up what i've had saved.  I'm going to have to take out a loan in the future anyway but I didn't know if it'd be smarter to do it now so that I have some money in the bank still to fall back on, or if I should use that money and get the loan later to delay accumulating interest fees and such.

I have no idea what would be the smartest.  While I'll probably try to talk to the financial department at my university, I was just looking for some input from you guys. Any thoughts?

I'm not sure what current rates are - I think my hubby's latest is around 5%.  It really depends on what you can get.  Fill out the fafsa (for federal aid).  Take all subsidized money you can - you don't have to pay any interest on it while you are in school.  Then, decide on the unsubsidized from there. 

While I was in school I took all the loans I could get and put my current money in a CD, so it was like I had extra money, withouht interest, because of the CD.

I don't qualify for any financial aid so I'm all on my own in the paying department :(

I was thinking that i sohuld take out a loan and keep my CD going just like you said, but i didn't know if i'd even qualify for a loan if I had enough money that I wasn't in immediate need.

on the same topic, so hopefully im not hyjacking too badly...but a student loan is sometimes supposed to help pay for like living expenses and whatnot right?  like if somebody who just got laid off wants to go to school he or she can get a loan to pay the rent and tuition?

Financial aid is for cost of attendance, which includes living expenses.  Each school has a set amount for cost of attendance.  That is the maximum you can take out in financial aid, including student loans.  The school you want to attend should have a website with a financial aid page that should list what their cost of attendance is.

One word:  FAFSA.  Filling out the FAFSA will get you all the money you can get; you decline whatever you don't want (i.e. so you don't take on any debt you don't want to take on).

The rate for my loan, and I remember that I could have got it for lower if I had acted quicker, is 2.9%.  The way the Fed has lowered interest rates, loans should be even lower than that.

As someone who will be paying off his educational debt until about 2030 (no exaggeration), I'd suggest you use your own money up front, but by all means talk to the financial dept.

You shouldn't have to pay interest rates on loans while you're attending school so be sure you file a deferment on interest if/when you get the loan.

You don't pay off your loans while in school, but unsubsidized loans gather interest while you are in school.

I should also say that dealing with Direct Loans can be frustrating.  Most of the time they're okay in my experience, but I just had this situation arise where I thought I had changed the account from which my payments were withdrawn and discovered that Direct Loans hadn't made the change (luckily, my discovery was made before the monthly payment date!).

Original Post by dnrothx:

You don't pay off your loans while in school, but unsubsidized loans gather interest while you are in school.

 Mine don't.  I submit two deferments every semester - one to defer payments, one to defer interest.

For unsubsidized loans, you can defer payment of the interest, not the interest itself.  The interest still accrues as part of the body of the loan while you are in school for unsubsidized loans.

EDIT:  See this paragraph from the official Direct Loans website:

You might be able to borrow loan funds beyond your subsidized loan amount even if you don't have demonstrated financial need. In that case, you'd receive an unsubsidized loan. Your school will subtract the total amount of your other financial aid from your cost of attendance to determine whether you're eligible for an unsubsidized loan. Unlike a subsidized loan, you are responsible for the interest from the time the unsubsidized loan is disbursed until it's paid in full. You can choose to pay the interest or allow it to accrue (accumulate) and be capitalized (that is, added to the principal amount of your loan). Capitalizing the interest will increase the amount you have to repay.

Have you talked with the Financial Aid office at the vet school? That may be a good place to start.

Yes, I'm  up to my eye balls in school loans but will beable to pay off 2 years after I start working next fall, but you have 10 years to pay off school loans. I didn't want to wipe out any saving I had for emergency house repairs. You can't get grants with savings or have a pretty good income but you are required to apply for a grant every year and get a reply before you apply for a student loan. Student load amounts haven't gone up in the past 15 years so but college tution has so what use to cover a fulltime student only covers 3 classes at the amount they give a senior, I'm paying about 1,500 to 2,000 out of pocket per term and buying my own books up to 300 for 2 classes. Freshman and jr. get a lower amount so you might what to start out at 2 classes which the loan amount should cover tution and books. Go to your financial aid off and they will get you started. As soon as taxes are done this year it is time to do the grant and loan papers for next fall term. Everything can be done online now. Good luck.

I'd second the suggestion to take out what you can in subsidized loans and pay the rest out of the savings account for now.  One good thing is that once you get to vet school, your parent's income level doesn't count against you, if that's what's currently keeping you from qualifying for grants/other financial aid.