Can you take out loans while on HPSP?

[chompsss]

Hello,

I have had a hard time getting a straight answer on this question, so I'm posing it to the collective forum in hopes that I can get real-world answers from people who actually have the HPSP and who have tried to borrow.

My scenario: I'm considering HPSP but my expenses are more than the ~$2,100 per month from the stipend/ADT pay.

My question: are there any options to borrow while you're on the HPSP (I mean any - like even private education loans)? I realize that schools consider you "fully funded" if you are getting the stipend and all of the schooling paid for, but what about someone like me whose expenses are more than the stipend? I don't much care if they're federal or private, I just want to know if there's anything I can do (aside from working while in dental school) to bridge the gap? I know private loan companies would be happy to give me the money, but the issue would be if the school would certify it...

HPSP recipients, please help!

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[jmh018]

3 year Air Force recipient here. Yes you can and I do. I no longer qualify for loans to cover school obviously. But in dental school you also qualify for a certain amount of federal loans to cover living expenses (around 20,000 per year) You still qualify for this, maybe slightly less. I qualify for around 18,000 per year for living expenses despite the stipend. Obviously, if you don't need it, its best not to take it. My wife stays home with our 8 month old son so I have to take around 5,000 of these loans to cover the extra costs each year. I actually take a little extra just to cover any unexpected expense. Anything extra I will dump into my first payment after I graduate.

 

[chompsss]

3 year Air Force recipient here. Yes you can and I do. I no longer qualify for loans to cover school obviously. But in dental school you also qualify for a certain amount of federal loans to cover living expenses (around 20,000 per year) You still qualify for this, maybe slightly less. I qualify for around 18,000 per year for living expenses despite the stipend. Obviously, if you don't need it, its best not to take it. My wife stays home with our 8 month old son so I have to take around 5,000 of these loans to cover the extra costs each year. I actually take a little extra just to cover any unexpected expense. Anything extra I will dump into my first payment after I graduate.

Hm... would you be able to find a document or something saying that we are eligible for loans? I just spoke with the financial aid department at UConn and they said that:

Their estimated cost of attendance for "living expenses" is $20,925 for the first year. The stipend of about $2,100 * 10.5 months = $22,050, and that doesn't include the 45 days of ADT pay (about $6-$7k extra). Since the amount of money I'd be receiving is technically already over the estimated cost of attendance for living expenses, I am ineligible per "federal regulations" to borrow in excess of their expected cost of attendance (save for child care expenses, unexpected auto repairs or medical bills). So, my expenses are about $2,300-$2,400 per month, and I'm basically being told that I'm S.O.L.

Does this sound reasonable? I mean... if I'm graduating with $0 debt (as the HPSP essentially allows us to do), I should be able to take out some "extra" loans to live a little more comfortably. I just don't get it.

 

[SigmaFS]

It depends on the school's interruption of the federal regs. UConn sees your stipend as a direct resource applied to their established living allowance. In other words, the combination of your HPSP plus the monthly stipend cannot exceed the estimated cost of attendance to be eligible for any federal loans. Other schools might classify your stipend as income, which would affect your EFC, but would allow for federal loans. Unfortunately, you're probably left a the mercy of the school's interruption of the federal regulations or S.O.L.

 

[jmh018]

Maybe it's different for UConn. But at Iowa, I declared the full cost of my scholarship which comes to around $76,000 with school and living costs. That was the incorrect way to fill out the form according to the financial aid people. They changed the form so that it only showed what would be paid directly to the school which was a little less that $50,000. Including my future stipends in the calculation is like including future income from a job. That is how it has worked for the past two years here. I qualified for $20,000 last year but a little less this year because we had some money saved up. Last year my wife had a full-time teaching job but I still qualified for loans to cover living costs.

 

[jmh018]

I don't know of any document stating this but if i qualified for federal loans on the same federal government scholarship, I would think it should be the same for you.

 

[chompsss]

Thanks so much for the input, everybody. It seems like there shouldn't be two different ways to interpret a regulation - it's a regulation, not a recommendation. How could I twist UConn's arm into allowing me to take out loans? Anybody got any good ideas? Should I contact the U.S. Department of Education to see if they can give me a straight answer that I could then relay to UConn?

 

[whaleofatale]

Thanks so much for the input, everybody. It seems like there shouldn't be two different ways to interpret a regulation - it's a regulation, not a recommendation. How could I twist UConn's arm into allowing me to take out loans? Anybody got any good ideas? Should I contact the U.S. Department of Education to see if they can give me a straight answer that I could then relay to UConn?

You can't "twist UConn's arm." You can borrow up to your total cost of attendance for the year, less other aid. Other aid includes the actual value of your scholarship (what is paid directly to the school) AND your monthly living stipend. If those two items already meet or exceed your annual COA you cannot borrow additional loans. It is 100% your responsibility to live within the stipend/COA that is provided.

 

[chompsss]

It sounds like, after speaking to many other HPSP recipients, some schools interpret the stipend as income (and thus, increasing EFC but allowing federal loans) while others interpret it as FA/scholarship and rendering one ineligible for aid. What gives? How can some schools approach this thing differently??