Apply Smarter Q&A: Student Loans and Financial Aid

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Apply Smarter Q&A: Student Loans and Financial Aid

Here are some questions and detailed answers about Student Loans and Financial Aid asked during Apply Smarter webinars.  We also covered questions and answers about veterinary school application and veterinary income.

“What is a “standard” amount of financial aid offered by vet schools? I know it varies a lot, but would you say it’s easy to get some aid?”

 

“Can Dept of Education Stafford loans cover the entire veterinary program? Are there options for anyone unable to secure a co-signer?”

 

The “standard” amount of financial aid offered for your veterinary education is defined by the Cost of Attendance (COA) published by each school. The COA includes Tuition & Fees as well as living expenses.

Veterinary School is a graduate/professional program. When you apply for financial aid for a graduate/professional program, you are considered independent from your parents. Using only your assets for financial aid consideration means your Expected Family Contribution (EFC) is quite often low or zero and you are usually awarded a financial aid package up to the COA.

 

If you’re married when you apply for financial aid or have children, or you significant assets (congrats!), your financial aid award can be higher or lower than the published COA for your veterinary school. If you fit the complicated case category, arrange to meet with the financial aid offices of the veterinary schools you want to attend.

 

You won’t likely need a co-signer (endorser), particularly if you stick with federal student loans.  However, private or non-federal student loans may require a co-signer.  Please note that you should not need to pursue private or non-federal student loans for veterinary school as you will almost certainly be offered the COA in Federal Direct Loan types.

 

Generally, the limit for Direct Unsubsidized Loans is $40,500 for a 9-month academic term. Any amount you need above $40,500 will require a Direct PLUS application for graduate/professional students. As long as you do not have an adverse credit history, amounts above $40,500 are covered by Direct PLUS Graduate Loans up to the COA.

“You mentioned financial aid awards from FAFSA during the webinar. Do you have to accept all of the money FAFSA offers you?”

 

No. The FAFSA award represents the maximum that you’re allowed to borrow for a given academic year. You can choose to accept as much of that award as you need. Generally, FAFSA makes it easier to borrow the maximum award than it does to return or reduce your award. However, if know you do not need all that you are awarded, you can (and should) choose to reduce your award.

 

If you reduce your award and discover that you need more, you can always go back during that academic year to request up to the amount initially awarded to you.

 

Interest accrues from the moment you receive your Federal Direct Loans. It’s less expensive to reduce your awards, borrow less, and request later if need be than to accrue interest on the higher amount at the beginning of each semester. Borrow less and reduce your stress!

“I heard savings count against you for FAFSA but the cap is different for graduate schools. Savings above $15,000 are considered. However, I had trouble finding this on FAFSA website. Do you have any resources on this?

 

Review the Expected Family Contribution (EFC) formula on the Student Aid website. It will depend on your marital status, taxable income, age, state, and other assets, number of dependents, etc. Generally, a fraction of your savings are considered in your EFC, but depending simply having savings does not mean that you will not receive the Cost of Attendance.

 

Visit with the financial aid office for the schools you’re considering or review the EFC formula guide to see how your financial aid might be impacted by your financial circumstances.

“Financially, how do international vet schools differ from domestic vet schools?”

 

Some international veterinary schools are accredited by the AVMA COE. U.S. veterinary students attending foreign accredited veterinary programs are eligible for Federal Direct Loans to finance their education. However, foreign veterinary schools have lower Direct Unsubsidized Loan limits.

 

You are only allowed to borrow $20,500 per academic year in Direct Unsubsidized Loans. The remainder will be covered by Direct PLUS Loans up to the Cost of Attendance. Generally, foreign accredited veterinary programs have costs similar to private or non-resident U.S. school costs. With more of the cost covered by higher-priced Direct PLUS loans, the interest and fees can add more to your total educational costs. Furthermore, exchange rates in some countries can contribute to additional borrowed amounts, which contribute to more interest and fees. Consider your costs carefully when attending a foreign veterinary program — particularly if you’re using student loans to finance your education.

“The VIN Foundation Cost of Education map estimates seem deceiving since some schools offer grants and scholarships which might significantly lower the cost?”

 

The VIN Foundation Cost of Education (COE) Map displays costs without any grants, scholarships, or outside funding. Scholarships, grants, and outside funding are not guaranteed by the schools. You will have to work to identify, apply, earn, and/or receive all funds to offset the cost of your education. The COE map also includes projections for increases to tuition and fees as well as interest on student loans. You can turn off projected tuition increases or student loan interest estimates in the COE map if you want to look at total costs without anticipated tuition increases or including student loan interest accrual.

“Are there any scholarships for minority students attending veterinary school?”

 

There are numerous scholarships available inside and outside of veterinary schools. For specific scholarship types, ask the financial aid and dean’s offices for a list. I would also search organizational websites like AVMA, AAVMC and any other national veterinary organizations.

“How do internships/residencies after veterinary school factor into addressing debt?”

 

It depends on how much student debt you have, the type of student debt you have, and what you anticipate your income to be after you complete your internship(s) and/or residency.  We do know that veterinary interns and residents earn significantly less during their advanced training periods.  We also know that some residencies that lead to board-certified specialization can also lead to above-average veterinary incomes.  If you have federal student loans, there are some beneficial options such as income-driven repayment that can help you manage your debt during your internship and residency years. When you reach that point, you choose the most beneficial repayment plan for your situation, and your payment will be a percentage of your taxable income This assures that you won’t owe more than you can afford.  THEN — when your income increases after the internship/residency, your monthly student loan payment will increase as well…

While this may seem to imply that it doesn’t matter how much student debt you have, keep in mind that it is ALWAYS easier to manage less student debt than it is to manage more.

Have more questions? Post a comment below or email studentdebt@VINFoundation.org.

Dr. Tony Bartels graduated in 2012 from the Colorado State University combined MBA/DVM program and is an employee of the Veterinary Information Network (VIN) and a VIN Foundation Board member. He and his wife have more than $400,000 in veterinary-school debt that they manage using federal income-driven repayment plans. By necessity (and now obsession), his professional activities include researching and speaking on veterinary-student debt, providing guidance to colleagues on loan-repayment strategies and contributing to VIN Foundation initiatives.

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