What happens is the lender sends the disbursement to the school, at that point the school will typically take out any fees that you owe them, and (check with your school to be sure) either refund the remaining to your lender or giveyou a check for the balance. At that point the check is yours. Obviously it isn’t designed for something such as buying a new car, but they don’t keep track of what you use it for either. Just keep in mind that you do still have to pay it back and they are at fairly high interest rates right now. Anything that you can have directly refunded will benefit you in the long run, but obviously if you need it for other expenses then that will be the best option for you right now.