Class of 2021 - Applying for Financial Aid

All forms to be turned in to the medical school can be scanned and e-mailed to jespada@iu.edu. As an alternative, it can be faxed or directed to:

1130 West Michigan Street, Fesler Hall 224
Indianapolis, IN 46202-5120
Fax: 317-278-2691

A medical education is a true investment with the expectation of enhanced earning power in the future. Until now, you have been encouraged to focus on your intellectual challenges, broadening your horizons, enjoying learning and becoming a person who will be engaged in analytic dialog with your surroundings throughout your life. At a minimum, you already assumed a temporary sacrifice of earning capacity while an undergraduate student, and for some, also added some indebtedness incurred in funding that phase of your education. In medical school, you will continue to suspend your earning capacity and more than likely incur educational debt as you continue to invest in yourself and future.

It is important that as a medical student you thoroughly understand the economics of your own personal situation. A large number of entering medical students have never been involved in financial arrangements that incur substantial debt. Your medical education is one of your biggest economic challenges and the prospect of indebtedness can be a source of considerable anxiety. It helps to remember that you are investing in yourself and your future. Faith in your proven abilities will allow you to handle the assumed total educational indebtedness in a way that is both matter of fact and does not constrain your prospects for the future.

Now is the time to develop good, basic fiscal skills, and a clear understanding of future goals and obligations as you pass through this phase of your education. If you have not already done so, it would be helpful to employ some simple budgeting techniques and a method of recording monthly expenditures. This will enable you to review your expenses so that as yearly requests for assistance are made, you can do so with a realistic understanding of your true financial need. Throughout your medical education we will offer formal and informal opportunities to acquire and nurture the skills to make sound decisions about loans and indebtedness that align with your principles and which will aid in your professional development.

We encourage you to also explore Financial Information, Resources, Services and Tools (FIRST) (www.aamc.org/FIRST) a resource to help you in your financial planning created by the Association of American Medical Colleges. We hope that as you interact with us, you have a much clearer understanding of what we are able to provide for you in your medical education years.

We look forward to working with you, and should you have questions or concerns, please do not hesitate to contact us.

The AAMC has partnered with SALT to provide money management tools, personal finance blogs, articles, videos and calculators as well as loan repayment assistance.

To access SALT and other financial literacy resources, go to http://mse.medicine.iu.edu/student-affairs/financial-aid/financial-literacy-topics.html

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Steps to Apply for Financial Aid at IUSM

Free Application for Federal Student Aid (FAFSA)

The 2017-2018 Academic Year FAFSA is required of all medical students applying for financial aid. It establishes a record in the university system and allows for communication about your eligibility for financial aid. Applying for financial aid at IUSM includes federal loans through the Direct Loan (DL) Federal (Unsubsidized) Stafford Loans, the DL Federal Graduate PLUS Loan, the Federal Loans to Disadvantaged Students, the Federal Primary Care Loan and any IUSM financial need-based scholarships. The FAFSA is to be completed each year beginning on January 1st each year when it is made available by the U.S. Department of Education. There is not a specific FAFSA deadline for medical students, but rather a target date of April 15 is encouraged so that you are receiving information in a timely manner from us. You are encouraged to provide parental information on the FAFSA in order to be considered for the more restricted Federal Loans to Disadvantaged Students and any IUSM financial need-based scholarships. If you are only applying for the DL Federal (Unsubsidized) Stafford Loans and the Direct Loan Federal Graduate PLUS Loan, then the parental information is not required or used in determining your eligibility. Keep in mind that not providing the parental information will exclude you from any considerations requiring the parental information. This includes any IUSM need-based scholarships, Loans to Disadvantaged Students and Primary Care Loans.

IUSM Application for Financial Assistance

  • To be considered for IUSM need-based scholarships, you must submit the IUSM Application for Financial Assistance to the school by May 31, 2017. Without this form you run the risk of missing out on more desirable IUSM funding opportunities.
  • If you are assigned or still considering one of the IUSM campuses outside Indianapolis, make sure the FAFSA reflects the school code for IUPUI only, 001813. Any other code will result in the medical school not receiving the information and not having a financial aid record created for you.

    In Summary:

    • the FAFSA results establishes a university financial aid record for the 2017-2018 academic year. All medical students must use the U.S. Department of Education Federal School Code 001813 (INDIANA UNIV-PURDUE UNIV/INDPLS). The results are used to determine a student’s eligibility for all Federal and IUSM student aid programs.
    • Regardless of your independency status, IUSM requires parental information on the FAFSA, specifically for need-based IUSM scholarships as well as any federal programs requiring the parent information, which includes the Loans to Disadvantaged Students and Federal Primary Care Loans.
    • The priority date for submitting the FAFSA is April 15. This is not a deadline, but a highly recommended target date for submitting the FAFSA. Submitting the FAFSA later than this date puts you at risk of missing out on IUSM opportunities.
    • Complete the IUSM Application for Financial Assistance.
    • The medical school will communicate regularly via e-mail to inform students on the financial aid process.

Indiana Primary Care Scholarship

IUSM Campus Scholarships

The IUSM Campus Scholarship listing

supplies information about scholarships that have been endowed for medical students at specific IUSM campuses.

The information below is an estimated view of how the financial aid budgets for the Class of 2021 will be constructed.

IUSM-4-year-Estimated-Cost-Sheet

Email and Other Essentials

For listing of Outside the medical school scholarships announcements, please go to Non-School Sources.

QUESTIONS and ANSWERS:

FAFSA RELATED QUESTIONS

Question: I am trying to complete my FAFSA before returning to school for next semester, but I'm running into trouble with my parent's financial information. They say they will not have any of the income and tax info until April sometime. Should I have them use previous years's information although the FAFSA asks for current numbers? Do you have any suggestions?

Answer: The U.S. Department of Education places great emphasis on the integrity of its federal financial aid programs. An important part of this effort is achieving a high level of accuracy for financial and other information provided by applicants. I would suggest using the previous year tax year information as an estimate on the FAFSA. You are given the opportunity to provide an estimate and then once the tax year information is available, you can update the information on the FAFSA. The school will automatically receive any updates on your FAFSA.

Question: I recently submitted and got back my FAFSA and it got me thinking about my rapidly approaching financial issues. Throughout my college career I have never needed student loans and as such know very little about the process. My questions include: what is the best type of loan, when to borrow a loan, etc. I have roughly enough money saved for one year of medical school with all expenses accounted for. I would like to know what is the best step to take from here. Should I borrow a loan after my money runs out or borrow right away? Any help you can provide will be greatly appreciated.

Answer: Approximately 12-15% of the admitted medical students each year have had experience borrowing as an undergraduate student. So, as you can imagine, we have 85% of the entering class who will be filing the FAFSA for the very first time and will be experiencing borrowing for the very first time as well. On our website, you will find a first year financial aid timeline that shows the financial aid budget as well as what is the typical maximum student loan borrowing. Of course, you need to tailor your borrowing to your specific needs. You can reduce the need to borrow by acquiring outside scholarships and by making sure you provide the school with everything they need to consider you for all financial aid opportunities through the school. In your case, you have your own resources that can be used to minimize your need to borrow. My best advice to you, in having your own resources, I would use your resources to perhaps delay or minimize the need to borrow the more expensive Graduate PLUS Loan until your third or fourth year. Depending on how much you have in your own resources, you may be able to avoid borrowing the Graduate PLUS Loan altogether during the four years of medical school.

Parent information on the FAFSA is key to positioning yourself to be considered for all resources through the school and the federal government.

Question: I am a single parent of two teens, for whom I pay child support. Is court-ordered child support considered a valid expense that can be included in my "financial aid budget" for medical school? In other words, would I be able to expand the amount I can borrow under the Graduate PLUS Loan Program to cover my child support payments?

Since I am in my 40's and both my parents are deceased, I would not be receiving any "family" support. I do have a modest amount tucked away in savings, would I be expected to contribute that to my own educational expenses, or can I keep that in savings for a "rainy day" or for my daughter's college educational expenses?

Answer: Unfortunately, the federal government’s regulations and guidelines do not allow for us to include court-ordered child support as an adjustment to the standard financial aid budget. The court-ordered child support is handled through the FAFSA application as an offset to the amount calculated by the FAFSA as a contribution to your education. The same applies to your modest savings. The savings will be considered a resource on the FAFSA from which a percentage of the assets will be expected in contributing to your education.

The only financial aid budget adjustments that are possible for our medical students is child care expenses and the costs related to the purchase of a computer. In the fourth year, many of our students do rotations away in another state or country and the expenses related to this activity can be used to adjust the standard financial aid budget. Additionally, fourth year students will be spending on residency interviewing, which can also be adjusted for in the financial aid budget. Adjusting the budget allows for additional borrowing within the federal loan programs, most commonly through the Graduate PLUS Loan.

Question: I have a question about filling out the FAFSA. Before starting the FAFSA I completed the "dependency status worksheet"which said I was independent and therefore not required to put any parental information on my FAFSA. However, in your email you specifically say I do need to include parental information. I was wondering why there is a descrepency between your directions and the department of education's directions. Also, if I do have to include parental information, could you please tell me why? Obviously my Dad does not still contribute to my educational expenses, and he considers his tax information private, especially if it seems to be irrelevant.

A final question. MyDad does not do his taxes until the end of April.He somehow gets an extension because of the nature of his work. Can I fill out his information on this year's FAFSAbased onhis return last year? He says that they should be about the same. After he gets his taxes back in lateApril I can update his information.

Answer: The FAFSA instructions are correct. You are an independent student for federal financial aid (funding through Title IV) purposes. This includes the Federal Unsubsidized Stafford and Federal Graduate PLUS Loans. And, you are correct that we are not expecting your parents to contribute due to your independent status. On the other hand, some federal programs require the parental information regardless of the student’s independency status. These programs include the Federal Primary Care Loan and the Federal Loans to Disadvantaged Students (LDS), which are funding sources through Title VII or the U.S. Department of Health and Human Services (DHHS). Additionally, the IUSM Scholarship Committee requires the parental information for students who wish to be considered for any IUSM need-based funding, which includes restricted scholarships with a financial need requirement or any other scholarships based fully or partially on financial need.

One big example for the need of parental information is the Federal LDS funding. Eligibility for these Title VII programs are strictly based on the parent income and household size and nothing else. Without the parental information on the FAFSA, you will not be considered for this funding. Now, if you do not wish to be considered for the LDS programs or any other funding sources that require the parental information and only want to receive the Federal Stafford Loans and Federal Graduate PLUS Loan, than you can choose not to provide the parent information on the FAFSA.

If you need to estimate the parent income to get the FAFSA submitted by the recommended target date, then using the previous year's information is a good way to estimate, especially if income and assets are fairly consistent from one year to the next.

Question: I recently submitted my FAFSA and received my EFC number of 13334. I am a little confused as to the meaning of this number. The FAFSA website says it is the amount of money that I should pay out of pocket, but I want to take out the maximum quantity of loans available. Can you explain the implication of the EFC number?

Answer: The EFC is the amount of student contribution (SC) calculated off the FAFSA using reported income and assets. If parental information is submitted, a similar calculation will be made on their information to produce a parent contribution (PC) that we use in our calculating the student's financial need. The formula for calculating financial need is the Cost of Attendance minus the SC and PC. The PC is only entered into the medical student financial aid process to help determine the eligibility for any need-based scholarships as well as any Federal programs like the Federal Primary Care Loan as well as the Loans to Disadvantaged Students (LDS). The LDS is based exclusively on the student’s parent income and the number of family members in the parent's household.

As a graduate/professionaal student, the EFC really has no significance as it pertains to qualifying or being eligible to borrow the maximum Direct Loan (DL) Federal Stafford Loans (up to $40,500) or the DL Federal Graduate PLUS Loan (to meet the difference between the cost of attendance and other financial aid). Now, as an undergraduate student, it has a lot of meaning. With the graduate/professional cost of attendance being so much higher than an undergraduate, it is rare that a medical student will have more SC than the cost.


Question: Since I am an international student, I am aware that I'm ineligible for Federal loans; however, I was wondering if I qualified for any of the scholarships awarded by IUSM. Secondly, since I am not eligible to receive federal aid, I was confused about whether or not I'd needed to fill a FAFSA form.

Answer: I understand your confusion since most of our information is geared toward U.S. Citizens or Permanent Residents. We have suspended the acceptance of International Students, other than Canadians, so we have a few International Students matriculate each year from Canada. The greatest challenge for the International Student is funding. The only resource available to an International Student are private loans. Typically, a private loan requires a U.S. Citizen or Permanent resident to serve as a co-signer.

You do not need to file a FAFSA. As a public institution with very little scholarship sources, we will not consider you for any need-based scholarships that has a restriction that requires you to be a U.S. Citizen or Permanent Resident as designated by the donor.

Question: I've submitted my FAFSA and I'm reviewing it to add parental information. Why is it that you encourage medical students to fill out parental information even if they aren't required to do so? Will it be assumed my parents are going to help pay for my medical school if I fill this section out even if that is not the case?

Answer: The reason for encouraging student to include the parental information on the FAFSA is to ensure that the student is being considered for all possible opportunities. Although parental information is not needed for a student qualifying for Federal loans through the Federal Stafford Loans or the Graduate PLUS Loan, parental information is used in determining the school’s limited financial need scholarship opportunities. As you can imagine, without parental information a large number of students will show exceptional financial need, but with calculated parental contributions, it makes it more possible to identify truly needy students. Additionally, there are some federal financial aid resources that require parental information, such as the Loans and Scholarships to Disadvantaged Students.

LOAN DEFERMENT QUESTIONS

Question: I took out undergraduate loans through Sallie Mae, and I was wondering how/when I can go about deferring this while in medical school. Currently, I am supposed to begin payment in November (paying back loans with loans would be disastrous). It seems that I probably need some sort of proof that I am again a full-time student?

Answer: Once you begin school in the Fall we will be able to process in-school deferment requests. The in-school deferment request form from any loan servicer can be turned in to us at Orientation. Be aware that IUPUI participates in the National Student Loan Clearinghouse, so paper requests are not necessary. In late August, IUPUI will report enrollment information to the Clearinghouse, which in turn, loan servicers like the U.S. Department of Education and others will be able to update borrower's enrollment status and place the student in an in-school deferment status. This is done each semester you are enrolled and sometimes there is a little lag in the time of reporting, but all in all things have been working well with the clearinghouse. Do realize that not all loan entities utilize the National Student Loan Clearinghouse. To be sure, contact your loan servicer to see if they participate in the Clearinghouse.

LOAN-SPECIFIC QUESTIONS

Question: When do I have to let the school know what loans I will be taking?

Answer: To allow for the necessary time to get things set for the Fall semester and not jeopardize the timetable for the release and disbursement of loans, it is recommended that you complete making any adjustments to your loans by July 31st. Realize that we can always reduce loans later in the academic year or we can process additional loans throughout the academic year, as long as you have eligibility to borrow. We encourage students to do their best to estimate what they will need upfront, but if needed, we can work with you later to re-do your loans to fit your situation. Of course, we can only process loans that you will be eligible for and have room in your budget to borrow. By law, we cannot exceed your cost of attendance or financial aid budget.

Question: I just have a few questions for you regarding my financial aid situation. First, when do we need to decide the amount of financial aid we want to receive (I am in the process of debating how much I want)? Second, is it worth taking out more money in order to pay off the interest each month or is this just trading interest for a higher principal which will equal each other out in the end? I am slightly concerned with the amount of loans I will have taken out by the end of med school ($250,000 give or take). I was wondering if this is something I should be worried about or if it is not uncommon to borrow this much? I was talking with a doctor friend who said that he consolidated his med school loans at a really low interest rate (2 or 3%). He graduated a few years back but I was wondering if this low of an interest rate is still possible or what interest rates are currently offered for consolidation?

Answer: You should wrap things up by the end of July to allow time for things to be set in place prior to the release of funds in August. Of course, you still have the Master Promissory Note to complete once origination occurs. This occurs in early July.

Unfortunately, the way of life for a medical student is to borrow what they need unless the student has resources that can reduce the need to borrow. With approximately 85% of our medical students graduating with student loan indebtedness, an average of $184,000 in the 2015 Graduating class, it is not unusual to see a student graduating with $250,000 or more. You can cut costs by living frugally (seeking roommates) and sticking to a budget will go a long way in limiting your borrowing to what you absolutely need. Using loan funds to pay the interest is not encouraged. The accumulation of interest and it being part of your balance later or paying the interest with student loan monies where you have borrowed more to do so is virtually the same activity. I would argue that borrowing additionally to pay accrued interest is a more expensive venture in the long run. Please utilize the resources located under financial literacy

Unlike graduates of yesteryear, you will be entering medical school in a student loan environment where your Federal Stafford loans are at a fixed interest rate using the interest rate formula of the 10-year treasury bill plus 3.6% for the Federal Stafford Loans and treasury bill plus 4.6% for the Grad PLUS Loan. These rates are determined annually, so a student could have four sets of fixed interest rates over the course of four years of medical school. The interest rate for both loans is for the life of the loan until it is paid in full.

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