Hello all,
I am not sure if this is the correct section of the forum to place this post, but here is my delimma. I have a condo in New York and I am 2.5 years into the mortaage. It is a nice cozy place and I would like to keep it. However, as I begin the medical application process I am also wondering if having a mortagage significantly affects the amount of financial aid offered by the medical schools. If this is the case then I am considering giving it up or having my siblings take over when I begin medical school (instate or out-of-state). However, I am sort of leaning towards the latter. What do ya think? Can I keep it? Huh, Huh?
Any feedback will be greatly appreciated. Thanks! 
Well no, maybe? I had a mortgage and borrowed $55,000 for the first year but also then sold my house. How would you pay for the mortgage if you had to go to another state for school?
Could you rent it out?
As far as the US goes I think it is $18,500 for med school Stafford before private loans. You can borrow the money for school but here’s the catch, (a big one!) You need good credit Fico 650 with no collections and no recent lates (last 6 months). Check your credit twice a year and make sure cause things like block buster (oh yea even them) can show up as a collection. My wife and I are trying to keep our loans down under $200,000 and that will be hard but we may be able to do it.
Hope this helps.
Bill 
I don’t recall having to put anything about my mortgage on my FAFSA (Free Application for Federal Student Aid). I qualified for a subsidized Stafford Loan my first year of medical school even though my husband had a substantial income and we had money in investments, etc. - because I had two kids in college. I don’t think the mortgage factors in when considering financial aid.
It IS something to think about in terms of how you’ll pay your mortgage while in school, however. There are medical school loans that can be used to pay living expenses, but when you’re doing the budgeting to figure out how much to ask to borrow for those living expenses, you’re given an “allowance” that is figured out by the school - NOT your actual expenses. The student budget is usually pretty bare-bones when it comes to living expenses.
The annual limit for Stafford loans for medical school was $38,500 when I was in school and I think it has increased a little since then. In my case, that was about what my annual tuition was - some of my classmates had to borrow that AND take out private loans for their living expenses. Fortunately my husband was employed for most of my med school years and so the living expenses were up to him.
Mary
Having a mortgage will have no effect on your financial aid as long as the mortgage is on the house you are living in. If it is a mortgage that is on a rental property, it still probably won’t affect how much financial aid you are getting unless you are raking a ton of profit from it.
Pretty much everyone is eligible for to borrow the maximum amount of Stafford loans (subsidized and unsubsidized) irregardless of how much money you or your spouse made. This year, the maximum amount is still $38,500. At most schools, you will be able to borrow this much because their budget will be that high or exceed it. (our first year budget is about $3000 higher than that).
Amy
Quote:38,500 as the max the school will allow even with private? (My school allowed more because I had a family). Wow if that is true then it would be hard, but renting it out to cover the mortgage could still work.
Having a mortgage will have no effect on your financial aid as long as the mortgage is on the house you are living in. If it is a mortgage that is on a rental property, it still probably won’t affect how much financial aid you are getting unless you are raking a ton of profit from it.
Pretty much everyone is eligible for to borrow the maximum amount of Stafford loans (subsidized and unsubsidized) irregardless of how much money you or your spouse made. This year, the maximum amount is still $38,500. At most schools, you will be able to borrow this much because their budget will be that high or exceed it. (our first year budget is about $3000 higher than that).
Amy
If married, do they go by your spouses credit too?
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38,500 as the max the school will allow even with private? (My school allowed more because I had a family). Wow if that is true then it would be hard, but renting it out to cover the mortgage could still work.
$38,500 is the max you can borrow in federal Stafford subsidized/unsubsidized loans. You can still borrow additional money from private lenders. I did read somewhere that the (federal) max allowed for some schools is higher than $38,500 (due to cost of living in that area, that type of thing). I’m not sure where you could look to find info on that. The most reliable source would probably be each school’s individual financial aid office.
You bring up a valid point above . . .you can appeal for your amount to be increased due to child care, dependents, etc. However, be very careful with that because there are aggregate limits on how much you can borrow from the federal government. I have heard stories (don’t know if they are true) of fourth year students scrambling to secure private loans because they had maxed out their federal loans and didn’t realize it.
Yep I agree 100% on that 
Even our plan of 150 to 200,000 scares me to death! A lot of money to pay back but if the current situation with FP continues there are ways to get some tuition reimbursement. I think it is best to count on having to pay it all back though. That way you may not borrow as much. Debt is bad real bad! Less the better
BTW my new loan is Sallie Mae http://www.salliemae.com/apply/borrowing/medloans.html
They have some good info and links.
My thing is that my credit isn’t perfect. I mean, I never filed bankruptcy or anything, don’t have any outstanding collections that haven’t been paid (still need to get my own report).
That being said, anyone know about the T.H.E. private loans, like what are the requirements. Think Im just going to do a search, but I still would appreciate any other additional info.
Im in the process of deciding b/w 2 schools one is 25k (wont have to worry about private loans) the other is 35Kk (WOULD) have to worry about private loans). I think I’d rather go to the more expensive school, but it isn’t even an option if I can’t be funded. 
Several things, don’t limit yourself to who to apply to because of the money so much. If you do acceptance may be a harder thing. These loan companies use these credit reporting (Sallie Mae is 100% correct per my check) Student loan Health Express – Transunion
Nellie Mae Medexcel – Experian
Sallie Mae Signature – Equifax
Terri – Transunion
go to http://www.creditboards.com/mambo/ and look at the credit forum not the student loan forum (that forum is mostly consolidation and people that have defaulted).
Please clean up your credit now. Collections can be taken off if you ask the company that put it on to take it off if you have paid or agree to pay it. It will take 6 months to a year to clean this up! I have done it and still have a collections on my report but paid off, can’t get it removed till after 7 years and that is 2006 now. The only reason Sallie Mae approved my loan was because I paid the collections off years ago. You would think going to med school was the hardest thing, I think just as hard is getting th money also.
Good Luck!
Thanks, I’m beyond the where to apply stage, I have mutliple acceptances and have narrowed it down b/w the 2 schools mentioned above. I’d hate to decline my seat at the 25k one and accept the 35k one, to find out I can’t get funded for living expenses.
Guess I need to pull from multiple credit report agencies to see my reports.–Uggg, even more money to do that and I am sooooo broke right now!!
You are entitled to a free credit report from each of the 3 major companies every 12 months.
http://www.ftc.gov/bcp/conline/pubs/credit/freereports.htm
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Awesome, thanks soooo much!!!
Yea they are right At least one report from all three once a year, In Ga its every 6 months. If you do disputes then the credit reporting company sends you an update and if it came off or not. Read the Fair credit act, thing is the credit reporting agencies dot always do whats right an still screw up.
It took me a good year to fight but I won. I didn’t give up. If you get turned down you can appeal after you find out why you were turned down. Cosigners are good to have, they also need good credit and FICO scores.
Don’t forget your FICO. Thats a score that is important, like I said go to www.creditboards.com and read cause your fico needs to be 650 at least credit cards less than 50% (40% is best) that is all credit cards, if you have 60% usage on one and 20% on another see if you can shift or get one down to that less than 50% it really does matter and it affects the fico. I really don’t understand this 100% but I know it works like this.
Good luck
BTW whats the different loan programs at the schools?
If you can list them maybe we can give more info.
Everyone should be able to get the basic money from stafford
in the US, it’s the other amounts that good credit is needed.
So the FICO is your credit score then, right? 
I will look into it.
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Thanks, I’m beyond the where to apply stage, I have mutliple acceptances and have narrowed it down b/w the 2 schools mentioned above. I’d hate to decline my seat at the 25k one and accept the 35k one, to find out I can’t get funded for living expenses.
Guess I need to pull from multiple credit report agencies to see my reports.–Uggg, even more money to do that and I am sooooo broke right now!!
Yo, if you’ve got acceptances to these schools then you have access to their Financial Aid Offices RIGHT NOW to try and figure out how to work this. They can and should work with you - and each of them will be eager to show you how it can work so that you’ll attend their school.
Give them a chance to help you. A common mistake we make as OPMs is assuming that we have to figure out everything on our own. While that is often the case as a pre-med, you do in fact have a lot of help available to you once you’re actually a student doctor.
Mary
Thanks Mary!! You are soo right! Maybe I am just so used to figuring things out, how to make things work-make ends meet that I’m so worried. I’m going to call their Financial Aid department on Monday. Weeew. I feel somewhat relieved just by your post. Thanks.
Yes I agree with Mary 100% Call the FinAid dept. But the above still stands, clean up the credit and know the reports and the score, this will give you the power to deal with the loan companies and life will be easier when dealing with credit.
The Finaid dept of the schools will also tell you upfront how much $ they will auth you to borrow each year.
You are going to be fine!
Good luck.
Update:
I chose the more expensive school. My FICO score is 700, I have 2 paid collection accounts (medical) for 100 bucks each that were paid early 2001. I was told I need a co-signer and that it couldn’t be my husband. Am I missing something here? Or is my credit really that bad? The FA rep said those 2 paid accts from 5 years ago will raise red flags? Since then I have paid off a mortgage, car, etc. etc.
No your credit is not too bad, paid collections 5 years old for medical is over looked in most cases, Sallie Mae will be okay,(I had on paid collection 6yrs old) in 2 more years they are gon for good off the report.
You may need a cosigner cause it’s 2, depends on the lender.
My school requires a cosigner for loans, guess too many defaults by others?
Talk to them about sending it through with out a cosigner then if you need one you will have to get one.
BTW very good credit to excellent credit FICO is 700 VG then 720 to 800 VG to excellent. I know there is a commercial that says 850 is top but only 0.05% have above 800 in the US.
Good luck.