Expert: David Disraeli - 8/14/2009

Question
QUESTION: I am a mother of 2 boys.  Older one is 27 and starting his 3rd year in Osteopathic Medicine in NY. I have paid for his cost of living and he took a loan ($33,000/year) for tuition only with Accessgroup.  Only $8,500 is Subsidized, both at 6.8%. I can not afford to support him anymore.  #1Question:  If I stop claiming him, would he be qualified for any kind of grants or loans at a better rate?  #2Question: What can we do to bring the rate of his current loan lower?  He will graduate in 6/2011, then he has 2 years of residency which I don't think he will have any substantial income.  #3Question: Would he be able to get any grants or loans during his residency?  I appreciate if you can give me as much as information possible to understand how does the system work.  Thank you.

ANSWER: Hi Shirin,

Your son would be considered "independent" meaning only his income/assets count because he is over 25.  That is the easy part.  I don't know of any way to get the current loans lowered, but he should be making pretty good money by the time he starts practice.  So - the deadline for FASFA was June 30th, 2009.  You could contact the school and explain that he should have been considered independent and see if they will make any arrangements.  

As for residency I don't know the answer about grants.  Technically it is not tuition, books etc so it strays from my expertise.  

I hope you find the answers you are looking for.

David Disraeli CFP

---------- FOLLOW-UP ----------

QUESTION: Thanks so much for your response.  He is going to school full time and spends the rest of the time studying.  As an independent what types of loans and grants are available to him?  He might qualify for more loan, to cover for living expenses, but would it be at lower rate?  Would he be able to apply to any type of grants that he does not have to pay back?  Him and I are open to any suggestion and advise you might have.  We appreciate your help.  Thank you.

Answer
He needs to contact the financial aid office at his school, explain his situation, then file the appropriate aid forms.  Once he does that he will get a response.  There is money available but it depends on too many factors for me to answer accurately.  EVERY school has a financial aid office so this should be pretty easy.  Let me know if you run into any roadblocks.  

David