Question:
I graduated from my college (undergraduate) in 1993, and duly began repaying my student loans (about $9200) 6 months later. I then went through a few years of financial slowness, and had a couple of my youthfully over-enthusiastic accounts (not my student loans, specifically a tire store and a an american express card) revoke status after some (admitedly very) late payments. I however paid everything off and slowly settled all my debts. I never defaulted on my student loans, though I was slow several times. All the other stuff was resolved in about 1999, and I have been making on time payments to the credit sources I still have, namely 2 credit cards, one which I keep at a zero balance for emergencies, the other I use for convenience and runs around $1-2K on average. In the meantime I have bought and completely paid off several cars, and I don't run into too many problems, except that I have been trying (unsucessfully) to get a lower rate credit card.

I have been turned down several times, but I keep falling for a different campaign. I have unfortunately also had my share of bounced checks and the occasional overdraft in my checking account, but this too came to a stop 2+ years ago. Some learn slower than others.. sigh. Anyway, as of now I have 10,000 in savings, an 401K worth 10K,assets worth perhaps 8,000 and liability to the tune of about 6K if you include my car loan and credit cards. I am leaving my job and entering graduate med school, and can support myself for probably 6-12 months depending on the availablity of rice and beans. I would however prefer to take out a loan (about $10K a year), to keep me from losing my "nest egg" too fast, and provide a bit of a safety blanket. I submitted the FSFA form to my schools back in January, and I was just accepted to Grad school but have not heard back from the Financial aide office. I have been making pretty decent money (>80K for the last year, much less before that), so I am pretty positive I am not eligible for grants or anything. But what are my chances on getting a Loan of this type? Is there anyway I can improve these chances? Is it at all advisable to just apply for these loans from some of the bankers I see around, and risk getting turned down and having that >added< to my credit reports?

Answer:
If you are not in default on your student loans then you should automatically be eligible for up to $18,500 in Stafford loans. If you are eligible, up to $8,500 of it can be interest free - it depends on your need as determined by the FAFSA. You should be hearing from the financial aid office pretty soon. If that is not enough to cover the cost of attendance, inquire of the aid office if there are other sources specific to grad students that you can use.