Who controls loan disbursements?

pscraig

Well-Known Member
I applied and was approved for a 60K Key Alternative Loan. I called Education Credit Corporation (FSI's financial aid contractor) to ask some questions, and am worried about one of the answers. My program should cost around $45-46K but I am borrowing 60K, so I assumed I had the extra 14-15K to use for anything, including living expenses. The ECC rep told me that the checks come from Key to FSI, and FSI will give me up to like $225 a week for living expenses, sending back any excess to Key. Is this the way it works? I was hoping to have a little extra left over. I also don't want the balance to dip below 60K, so I get the 20 year repayment option. I know a lot of you guys are doing this, so help me out-is this the way it works?
 

chunk75

Well-Known Member
You go to the office to pick up your check (don't want to use her name online without her permission) and they'll give it to you. What you do with it is up to you. The $225 figure is what they use for planning purposes. The money is yours and can sit in your bank account collecting interest if you'd like. 'Course, when you deposit the check, the interest meter starts.

Chunk
 

pavelump

Well-Known Member
You can have it split into a maximum of 4 disbursements. i.e. I was approved for the entire 80k so I will be getting 4 checks for $20k each. They don't all have to be the same amount though so I could have gone with any combination as long as it didn't exceed 4 disbursements. Does that make any sense? Also, just because the check is disbursed doesn't mean that you have to take it. FSI will hold it in their safe for you until you need to cash it which as chunk said will delay interest from forming on it. Once you cash it, interest starts. Kerrr-Changgg!

Later,
Dave
 

Acadia

Well-Known Member
Ditto to the previous posts. I got my loan in four checks and I set up the exact dates with the loan ladies at FSI. I think there are certain types of loans or rules that require more school control over the funds in some situations. It may even be how the loan is set up in the case of younger students. I noticed in the bookstore that some students had to have non required materials purchases approved if it was coming from their account(ie. no nice GPS without approval). I think parents & banks dont want little Timmy or Sally to spend 10k in living expense money in one shot.
 
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