How do you pay for non-direct costs with loans?

Question

I'm a little confused and hopefully one of the current students can help.

From what I've gathered, the school will take care of paying for all the directly bill costs of attendance (tuition, boarding, health insurance, etc).

How do you get the funds you need to pay for books for example? Or living expenses? Do you get a check directly from the lender? Or does it go to the school who pays it out to you?

You obviously need a decent amount of cash on hand to cover immediate expenses, but how long does it take to get "reimbursed" through your student loan?

Thanks!

RF

isa · Answer

Oh that's a good question. I've been wondering that as well. I imagine that the loan check would go into a bank account, and then it's up to you as the individual to spend it?

solaris1 · Answer

Your lender will usually send semesterly or quarterly payments directly to the school bursar, and then you will typically need to request a refund from the bursar. With the money you get refunded to you, you can take care of books, living expenses et cetera.

Some schools will direct deposit excess student loan funds into your checking account, so that should only take a a couple of days. Others might have more convoluted bureacracy involved?

There is supposedly a lag of a few weeks between when the first semester starts and the first student loan checks arrive, so depending upon your school start date, you might need to cover those first few weeks' expenses out of savings.

In any case, it's not a bad idea to keep a few hundred dollars in reserve just in case you need to spend something before your refund checks or ACH push arrives. On a related note, a lot of schools will provide small (interest free) loans for a short period too to help students get by if they're suddenly in need of a bit of money and the student loan refunds haven't hit their accounts yet.

refurb · Answer

Thanks Solaris!

I think the refund thing is how Tuck does it. It mentions that any "excess" money will be refunded by check after all your direct costs are paid.

RF

isa · Answer

What's an ACH?
Thanks!

riverripper · Answer

Kellogg automatically transfers the remainder each quarter on the first day of classes. So you will get whatever is left direct deposited into your checking. I dont know about loans, I think in this day everyone just uses credit cards...and that buys you a month of interest free to pay it off basically.

Toubab · Answer

At Duke, as at most schools, I imagine, your living expenses/books/etc. are all a part of that COA amount you borrow from your lender. Your lender doesn't send you any money - they send it all to the school bursar's office, who turns around and issues you a "refund" for that amount minus tuition. I'm sure that most schools will want to do it by direct deposit into your bank account (that's what an ACH transfer is).

It probably depends on your bursar's office, but unless you have some sort of odd delay from your lender, you should get your refund within a few weeks of school starting. At Duke, they say it's the first week of classes in early August. I've heard from folks who got their refunds a few days before and after.

jb32 · Answer

It's an Automated Clearinghouse:  https://en.wikipedia.org/wiki/Automated_Clearing_House

Isa, I believe Kellogg does it differently and direct deposits a check for your entire loan amount on the first day of each quarter (I think Sept. 1?). Then you are required to pay all your bills, tuition, rent, etc. from that money. Basically nothing is automatically deducted.

riverripper · Answer

Not true...All tuition and fees for the school comes out. You don't have to write any checks to the school if you are taking loans. Basically, you will get whatever is left each semester after that distributed via direct deposit. It is extremely easy and you will get your money first day of classes basically. Financial aid folks are dfinitely a lot better than admissions.

isa · Answer

Thanks for the insight!

isa · Answer

thanks!!

jb32 · Answer

Thanks for the clarification!

How do you pay for non-direct costs with loans?

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