🤦‍♂️ 2 reasons you may not see loans on your first tuition bill
Just because you’ve filed the FAFSA doesn’t mean you’ll automatically see federal student loans on your son or daughter’s first tuition bill this summer. You’ll automatically qualify for the loans, however if entering their first year, there are two additional steps to take to ensure the loans are released to the institution. If incomplete, you won’t be able to access undergraduate federal loans that can be a great borrowing source for students. To see the loans on your first bill, you’ll need to sign the master promissory note and complete student loan entrance counseling.
Let’s familiarize you on what’s entailed:
- Master Promissory Note (MPN)
- In short, it is a legal document that your student signs promising to pay back both their student loans along with any interest accrued to the US Department of Education after graduation.
- It’s not all legal jargon, however. For the 17- or 18-year old student, he/she is agreeing to take on thousands of dollars in federal loans. With so much at stake, the form provides an opportunity for your child to read and know what’s entailed in this agreement for repayment.
- Student loan entrance counseling
- Where the promissory note is the legal document, entrance counseling is all about education! This is not a one-minute signature but rather an opportunity to spend 30 minutes with your child to learn the in’s and out’s of their loans, repayment and options after graduation.
- Providing your child with an understanding of their federal loans can go a long way to shape expectations and help plan for your child’s finances post grad. After all, it is the not-so-distant future!
Complete these steps, and you’ll be on your way to accessing undergraduate loans for your child which can be an advantageous borrowing source compare with other options.
Have questions on borrowing for college in your situation?
CLICK HERE to book a time to chat.
All the best,
Andrew Holmes, Certified College Planning Specialist™
Andrew@PlanWithFPS.com
617-630-4978
Financial Planning Solutions, LLC (FPS) is a Registered Investment Advisor. Financial Planning Solutions, LLC (FPS) provides this blog for informational and educational purposes only. Nothing in this blog should be considered investment, tax, or legal advice. FPS only renders personalized advice to each client. Information herein includes opinions and source information that is believed to be reliable. However, such information may not be independently verified by FPS. Please see important disclosures link at the bottom of this page.