528 Colleges Using Lower Home Equity % For 2006????

Paying for College
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<p>sybbie, scott I hope you will chime in.
I seem to remember reading SOMEWHERE that the 528 colleges will be using a lower home equity calculation for 2006, instead of the 2.5% currently used. Is this correct? Or was I just dreamng [hoping]?.</p>

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Here’s a weird one: 29 elite schools--known as the 568 Presidents’ Group, after the federal antitrust exception that allows them to set joint-aid rules--count the market value of a house, up to 2.4 times a family’s income, as an available asset, regardless of a family’s equity. (If your income is $100,000, the cap is $240,000, and you’re supposedly able to kick in an extra $12,000 a year from your house, even if it’s already mortgaged to the rafters.) Happily, the 568 group, including Dartmouth, Duke and the University of Pennsylvania, plans to change to a more generous scheme that counts only equity and caps that at 1.2 times income. (Member schools are listed at 568group.org.)

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<p>Source: <a href="http://www.forbes.com/archive/forbes/2006/0313/065_2.html%5B/url%5D"&gt;http://www.forbes.com/archive/forbes/2006/0313/065_2.html&lt;/a&gt;&lt;/p>

<p>Actually- this turns out to be an excellent article about the whole home equity trap; "College Aid Strategems" - the first page begins at <a href="http://www.forbes.com/archive/forbes/2006/0313/065.html%5B/url%5D"&gt;http://www.forbes.com/archive/forbes/2006/0313/065.html&lt;/a&gt;&lt;/p>

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<p>Menloparkmom - since your son has already been accepted at Dartmouth, I would suggest that you call someone in their financial aid department and ask... rather than relying on what is essentially a rumor of what the 568 schools might do. Ask specifically how your home equity was calculated and applied for purposes of your current award, and whether there are anticipated changes for the future. </p>

<p>I honestly wanted to hug the financial aid person at my daughter's college after our home equity chat -- I was soooo relieved and she was soooo nice and understanding. It's not a 568 school, but they have their own formula that turns out to be very reasonable.</p>

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<p>Thanks calmom!</p>