Loan Amounts
Dear Betsy,
I just received my youngest son’s financial aid letter for his freshman year. Under the Stafford loan section, it says he’s only eligible to receive a little over $2,600 for the entire year. I’m able to take out a parent loan to make up the rest, but since the interest rate on the Stafford loan is lower than the parent loan, I was hoping for more under his name. My older daughter is a senior at a different university this year and she received over $5,000 in Stafford loans. Is this a state “thing”? Is there anything I can do to appeal? Thanks for your help!
Walter
Dear Walter,
The loan amount differences you’re seeing on your daughter’s financial aid letters are actually a grade level issue rather than a state issue. Undergraduates who are considered dependants are eligible for up to $2,625 their 1st year, $3,500 the 2nd year and $5,500 for 3rd year and beyond. Research has shown that if a student drops out of college their freshman year, they have a pretty high likelihood of defaulting on their student loans so the idea is to keep the debt level lower during these 1st few years in hopes of keeping them on track.
There are additional loan amounts available for independent, medical and graduate students and for dependants. There are parent loans and other federal and private loan programs available to help meet the tuition bill. Talk to your son’s financial aid office for more information or see their website.
Good luck!!
Betsy
