Free money? Hidden deathtrap?
April 26, 2010 10:26 AM Subscribe
Should I take a subsidized Stafford Loan if I don't need it?
posted by zvs to work & money (30 answers total) 4 users marked this as a favorite
[FinancialAidFilter] I'm starting a graduate program, and FAFSA calculated my need in such a way that I'm eligible for an $8500 subsidized Stafford Loan for my first year.
The thing is, I don't need a loan. While everything I put on FAFSA is correct, I've got enough savings and income (I have a full-time job) to cover all my expenses without going into debt.
I understand that there's a 4% origination fee on these loans, but is there any compelling reason I shouldn't take it out, invest the money (I'm assuming I can put it to work for at least 4% in the 21 months I'll be in school) and then pay it back immediately on graduation day? Is there some gotcha here, or is it free money that I should jump for?