<p>I agree with posts about inequity of financial aid. I diligently paid off home in 15 years so I could re-mortgage for college. (Few luxuries, extra work etc.) I fully expected to fund both kids college education. I have posted elsewhere why this became impossible. Had that plan worked I would have been ecstatic and not really concerned with what others were receiving because I would have felt we were in the driver's seat. As it turns out, my husband is not as responsible as I and all re-mortgaging funds went to pay back business loans, and we almost lost our completely paid off house. It seems that our equity was equally attractive to unscrupulous business accountants.</p>
<p>Therefore, our amount of debt did enable us to qualify for financial aid. However, the trick was getting into a school willing to provide it. It was heartbreaking to receive many rejections for schools kids were quite qualified for. I am not complaining. Kids wrre accepted at wonderful colleges with doable aid packages. However, I would have preferred it if original plan had worked and WE had more control of the process. I am quite relieved that my kids weren't punished for having a naive and narcisstic father because they would have suffered, and I would have suffered. He would have been fine.</p>
<p>In addition, I am a college professor who receives no tuition exchange because I teach at CC. Many of my students are disadvantaged, and I do feel I am making a social contribution. Friends at more elite institutions send kids to college practically free.</p>
<p>I know this is a very personal post, but my point is to say, I wouldn't have minded fully funding my kids' education to have been able to be in control. The family that does everything "right" gets that; the high spenders do not. It's no small thing.</p>
<p>However, this poster can be awarded significant financial aid while keeping his/her home - then after the kid(s) graduate - sell the home and use that money for other purposes.</p>
<p>I think that would work best in areas- where home values are very low and where the family does not owe on it more than what they can pay off before they retire.
I think we would have been happy with that scenario ;)
Its mind boggling to think of where we would have to move to, to be able to to afford to live on a fixed income.</p>
<p>:::::::: ohwait- I just saw the weather forecast for today, 102F, no way!- have to change the title of this thread- 102 deg in * Seattle*?:::::::::::::::</p>
<p>BUt while this discussion is very interesting, for us as calmom has pointed out, it might not be my daughters actual EFC. </p>
<p>If a college doesn't look at house appreciation, or if we get our assessment reduced as my brother in law has done with his house &/or we are able to explain that while this year my H has worked an average of 51 hours a week all year, ( he had to go into work at 2 am this morning for example after getting in yesterday @ 3pm), that won't be a scenario that is repeated while she is in school.</p>
<p>( I hope not- it would be nice if he was around for a few years to get to enjoy retirement-
but he might have a stroke when he hears of my plan to either adopt/have a fling with a healthy 35 year old ( that is really as young as I could consider) and get pg to have another child/deduction. After all neither one of my girls are interested in getting me grandchildren & I want to get some more mileage out of all these children's books):)</p>
<p>I'm so sorry that happened to you, mythmom. I really enjoy your posts.</p>
<p>And ek--way to put a positive spin on a difficult situation!</p>
<p>"I am interested in what your market is like that encouraged you to put, what I assume was enough for a deposit on a home, into paper instead."</p>
<p>It wasn't a lump I put in paper at any one time but steady saving of the difference between rent and a mortgage. Yes some is in retirement accounts and protected but then who has a pension anymore except government workers and folks in unions?</p>
<p>I understand that most folks think owning your own home is a great investment, but I have never been completely convinced. Certainly some folks see massive appreciation, especially in smaller homes, but it can be really hard to realize those gains unless you are willing to pack up and move to a slower growing region as you well know.</p>
<p>Does anyone know how the home equity value is calculated? It is based on the market value or on the paid price?</p>
<p>Market value minus the mortgage.</p>
<p>I understand that most folks think owning your own home is a great investment, but I have never been completely convinced. Certainly some folks see massive appreciation, especially in smaller homes, but it can be really hard to realize those gains unless you are willing to pack up and move to a slower growing region as you well know.</p>
<p>True it is hard to access the funds- and harder to pay for it, if you are already at the payment level you can best afford.</p>
<p>But I have "some" control over my other monthly costs- I can use less water- I don't have to have DSL or cable, I don't even * have* to have a cell!
But unless I am happy moving every time the rent goes up, I don't have a lot of control over what the landlord is going to charge.
Renters in our area, have been forced to move- because the building is going condo- or they have found that their rent is increasing 78% and higher?
Essentially</a> evicting them.
The owners can also decide that they want use of the building-and while they have to give you notice- moving can be a huge hassle- which is perhaps why we have stayed put for so long.</p>
<p>Im sure some landlords are great- we always had at least local owners, but nowdays some owners may not even live in the country, let alone the state and have managing firms who are only concerned with the black ink.</p>
<p><a href="and%20I%20agree%20with%20you%20about%20pensions-%20the%20benefits%20for%20government%20workers%20are%20very%20impressive%20but%20funding%20seems%20erratic">url=http://www.spokesmanreview.com/blogs/olympia/archive.asp?postID=5487</a></p>
<p>FAFSA doesn't take into account home equity</p>
<p>& I have always used the county assessors guesstimate ( since they just view the homes on paper)- minus the amount owed + money that we would need to spend to bring it up to code/get it salable</p>
<p>
[quote]
This calculator uses the Federal Housing Index Multiplier (2006 tables) from the Bureau of Economic Analysis at the US Department of Commerce to compute the minimum derived value of your home, based on the purchase price of your home and the year of purchase. This will produce a very conservative figure for the value of your home in the current real estate market. It is a good idea to add an extra 10% to the value reported by this calculator. If, however, you have a recent assessed valuation or appraisal that is higher than this figure, we recommend using the assessment to be safe.</p>
<p>If there are extenuating circumstances that cause your home to be worth less than this value, use the lower value but be prepared to document it with assessments, appraisals or other proof of depreciated value.
[/quote]
</p>
<p>Our assessment is higher than the Fed Index multiplier (but the EFC calculator I've used says that index number is lowball and to add at least 10% to it anyway), but it's a number I can use to explain why we used it rather than trying to peg the current market value, which is highly variable these days. Good point about having to spend money to get the house in shape to sell!</p>
<p>Regarding home equity and financial aid. As others have pointed out, it is only taken into consideration by schools that use the Profile. When it is included, it is treated as any other parental asset, which means your EFC will increase by only about 5% of your net equity. Additionally, many schools cap the amount of home equity that will be counted at some multiplier of parental income. This protects families living in areas that have seen skyrocketing housing prices, but whose incomes have not increased proportionately. For example, if you only make 45K your home equity would be capped at 135,000, which means it increases your EFC by around 7k, even if your paper home equity is much higher. Both my children attend private schools that use the Profile and both schools wanted to know the purchase price and the date of purchase so they could do their best to determine which students really needed aid. It's not an easy job, but my experience has been that the schools go to bat to help.</p>
<p>*Additionally, many schools cap the amount of home equity that will be counted at some multiplier of parental income. *</p>
<p>Well at least 28 schools anyway- while my daughter would probably love to attend Pomona- it probably isn't within reach academically.</p>
<p>Trying to find info about less competitive schools that cap equity- Ill let you know if I find a list.</p>