<p>I see a couple of issues, and a couple of answers.</p>
<p>Stafford loans are paid directly to the institution, and dispersed in two equal installments, one each semester and are credited against the outstanding balance. The only way you get cash in hand is if there is a surplus of payments, resulting in a credit balance on the account. The money is then returned to the student in a check. Thus, using Stafford loan proceeds to buy in an instrument will at the very least present a cash flow issue.</p>
<p>I can’t recall the max Stafford loan amounts, as they’ve recently been increased, but I think around $4k is the freshman loan limit. Depending on the type and quality of an instrument, 4k can be a drop in the bucket.</p>
<p>Now, if you are applying as a music student in a music major, some schools may consider that an instrument upgrade is required to succeed or at least compete on an equal footing with the majority of students in the program. They may well increase your COA estimate to allow the inclusion of an amount to include a new instrument. This will be a school specific policy, and you may need to sit down with a financial aid officer familiar with the music department to negotiate this. They may also have alternative sources available for instrument funding. I have personal knowledge of 2 scenarios where this was done, but to recognize specific needs for financially strapped students playing borrowed or low quality instruments.</p>
<p>It can and has been done (at least getting a school to recognize a new instrument as part of COA), thereby increasing your “financial need”, which may increase institutional merit, as well as need based aid.</p>
<p>I’m not a financial aid expert. There are posters (NikkiL, & others) within the financial aid forum that are, and they can cite the federal regs. Federally administered aid is to be used against educational expense; in the case of a music major, an instrument MAY be justifiably classified as an educational expense. </p>
<p>A similar question here, <a href=“http://talk.collegeconfidential.com/music-major/526360-tax-questions-musicians.html?highlight=questions[/url]”>http://talk.collegeconfidential.com/music-major/526360-tax-questions-musicians.html?highlight=questions</a> beginning with post #29 but from a tax standpoint relating to an instrument as a qualified educational expense for a music education student.</p>
<p>Once again, a qualified financial aid pro at your school(s) will be the most definitive source of info, and can provide the required supporting documentation to avoid possible issues down the road.</p>
<p>Good luck.</p>