I thought the extra aid in CA public schools comes from Calgrant.
Anyways, most public schools don’t give instititutional aid, you would get whatever federal or state grants you qualify for, maybe merit, and federal loans.
Some exceptions are UVA, UNC, U Mich (for IS/OOS with certain income).
I was just trying to say that once your EFC is past federal or state eligibility, the actual number might not matter much.
"Either way as a financial aid person at a university, if someone requests special circumstances, I would investigate why someone with a second home is trying to get financial aid. "
Well, this is all new to me. I am not familiar with how financial aid offices view my profile. My wife worked 15 years as a part time employee to build up the stock. She sold it all to move her elderly mother close by. Now her account is bare. Her decision. Her mother. I supported her. Now we are trying to figure out how to pay for college and whether we are eligible for aid. It certainly is not nor was it a case of disposable income used for a 2nd home down the shore.
The colleges might see it as a choice. It was a sizeable amount if it doubled the EFC. And it could have been used for college.
Your kids might have to look at local options or pursue merit.
Sorry, you were right about Response #7
I am not so sure about how to view someones profile. In general they dont look at the profile, they just go by the numbers. So the best thing to do is to understand what affects the numbers, and respond to every question truthfully. Maybe next year you can make adjustments to improve the numbers.
Only when you request them to take a deeper look, will they take a deeper look at why the numbers do not represent the reality of your capacity to fund your kids college education. At that point they will not only look at things that work in your favor, they will also look for things that go against you. One of the reasons they do this is to discourage people from requesting special circumstances, since that takes up a lot of manpower.
Is there a difference in my two profiles? How my weight is given to assets as opposed to income? Below example does not include our other assets.
A) EFC $20k with $50k additional assets(my wife’s account)
B) ERC $40k with $0k additional assets(my wife’s account)
College FA doesn’t follow Fannie Mae nor, every way the IRS treats income and assets.
From the college’s perspective, you made a discretionary choice. That money could have gone toward college costs.
Even if you charge her nothing, you now own a 2nd property, not your principal residence.
It’s not just the time needed to review PJ. It’s the known attempts to misrepresent or manipulate. I’m not suggesting you are. But standards have evolved in the tussle over who pays what for what college costs.
And a rule that finaid folks need to treat all who fall into certain categories in the same manner. No special dispensation that this arrangement is the way you chose to help her.
It’s not “B) ERC $40k with $0k additional assets(my wife’s account)”
It’s EFC 40k with 0 in stock, $xx (44k?) in a second home with its own market value.
Jumpy, if you guys aren’t putting every cent you can spare into your IRA’s or 401K’s (up to the limit of course) it’s not too late for this year. There are many ways for your kids to fund a college education but there are only three ways to fund your retirement- assets you’ve saved, relying on your kids, or living on social security. So make sure you’re being forward-thinking even as you are trying to maximize the amount of aid you might qualify for.
You guys sound like wonderful people. I know it’s a shock to realize that the good things you try to do for family don’t always pay off financially. Your MIL is lucky to have you guys.
By no means am I trying to misrepresent my assets or financial condition. I am merely wondering if it is worth the effort to explain that my 2016 reported income is not indicative of my past or future earnings. Based on the comments above, it seems like it may not even matter based on my assets or EFC(actual or inflated).
FAFSA says you get to have one primary residence excluded from the asset section and no matter if this condo is considered owner occupied or not for the purpose of insurance and taxes, it is the second home and must be included as an asset on FAFSA. My sister has a home and it is her primary residence. Her DL, car registration, and voter registration all list that address. Her husband has a home about an hour away because he works near that home. He’s there Sun-Thurs. His DL, his car, his voting registration is all from that address. They do not rent it out. If he gets called for jury duty it is from that address. On FAFSA they have to claim his home as a second home, an asset.
Yes. Explain it as a one time bump. But the issue is how you used that money, that you now have assets of 44k in a 2nd home with it’s own value, presumably appreciating . You aren’t saying uninsured medical expenses, eg, that are gone. You took $ that could have helped with college costs and moved it sideways.
Kids whose families support indigent relatives living elsewhere, eg, get no break. Owning a home underwater/less value than owed, generally gets no break. Low income folks who somehow own a second property that puts food on the table, don’t necessarily get a break. Assets are assets.
The only protection is money in a QRP, Qualified Retirement Plan-- locked in a future pension or 401k.
Or if you had moved her in with you and paid most if her support, she might have qualified as a dependent.
You have to file the FAFSA with the facts as they are - 2016 with extra income, current assets including the new condo. There is no way to explain on the FAFSA form. You can then file for special circumstances/professional judgment with each individual school and hope they do consider what happened. If you hadn’t converted the stock in 2016, it would have been an asset but not income. Because you did convert, for 2016 it is both, income and a new asset in the new condo (you have to determine the value, which may be the same as the stock, $44k, if say the value of the condo is $244k and the mortgage is now $200k)
Fannie Mae only cares if it is owner occupied for mortgage rate and ability to get homeowner’s insurance (much higher for non-owner occupied). The down payment on non-owner occupied is often 50% down. HUD cares about the % of non-owner occupied units in a complex. FAFSA does’t care at all. In fact, FAFSA doesn’t care if there is a structure on the property, or if you park cars on the lawn, or if it has water and sewerage connections. FAFSA only wants to know the value of the asset.
I disagree that you shouldn’t care if your EFC is $40k or $20k. You’ll get no Pell grant either way, but you might qualify for other FA, and you might qualify for subsidized loans.
Thanks all. I am not disputing how I have to file and what assets I have to include. That is all clear to me.
I was just trying to get feedback on whether I should pursue with an added explanation and when to do it.
This is what I would do.
1 - Run my spreadsheet with all the alternate possible cases of income / assets that you think you can convince under special circumstances, and get the EFC for each case.
http://talk.qa.collegeconfidential.com/financial-aid-scholarships/1726777-fafsa-spreadsheet.html#latest
2 - Using this EFC or using the data you gathered to get the EFC, run it through the NPC of the universities that you are considering. Remember that whenever they request income on NPC calculators it should include income such as AGI+IRA/401k contributions+Child support received.
3 - Now you will have a table Financial Aid x University for each alternate case.
If you see that the financial aid difference is minimal or none, or it will not affect your decision of which university to attend, only request special circumstances for that one university you decide to attend, somewhere in April.
If it actually makes a big difference which could affect your decision to accept, then you should start the process for the universities that matter as soon as you can.
I went through this exercise to help a relative of mine, and it turned out only 1 university it was worth attempting something now, and all the others it was only worth dealing with if she knew she was going to attend.
I wouldn’t just use the College Board EFC projector. Run the individual colleges’ Net Price Calculators (NPC) on their websites. Play several scenarios. The Fafsa EFC can be lower.
Also, some colleges used to more or less lock you into the freshman aid picture. As one said to a friend, “Next year, if your income goes up, great for you. If it goes down, oops.” So ensure your targets review each year.
Again …You should probably require your child to apply to at least 2-3 financial safety schools…these are schools that will give huge merit regardless of need and based on your child’s stats…
Some of us call these choices, parent picks, that their child must apply to so that if none of the child’s choices work out or if the child’s choices are unaffordable, there are still some affordable options.
Since you put a large down payment on the second home, that will still e an asset that will drive EFC.
If you’re not prepared to pay $30k-40k+ per year for college, then insist on some financial safeties. There are some colleges that give assured merit for certain stats. And many of them have deadlines for merit in November and December, so don’t wait on those.
not that it will help you now, but a similar situation killed us. When my oldest was a sophomore in HS (so we had no clue), my spouse’s elderly father needed a new living situation. H and his 3 siblings decided to buy him a condo and the Dad would make the monthly payments. We put the condo in our name because we had the best credit and also because we were the most concerned…we put down 1/4 of the large down payment and the other 3 put down their 1/4 to us. THEN it became time to file financial forms for college and we discovered that now we had a "second property’ and a “renter.” It truly affected our estimates.
sample NPC calculators:
http://financialaid.calpoly.edu/calculator/npcalc.htm
http://admission.gatech.edu/npc_2015/npcalc.htm
http://sfa.mst.edu/calculator
http://studentaffairs.sdsu.edu/ofas2/NPCC/npcalc.htm
http://vpsaweb2.sjsu.edu/faso/netpricecalc/npcalc.htm
http://financialaid.stanford.edu/undergrad/how/calculator/input.html
http://financialaid.arizona.edu/general/freshman-net-price-calculator
http://saservices.berkeley.edu/calculator/Dependent.aspx
http://financialaid.ucdavis.edu/AidEstimator
http://www.ofas.uci.edu/content/Calculator_Dependent.aspx
http://app.financialaid.ucla.edu/FASEstimator/Dependent.aspx
http://sa-web.ucsd.edu/aidestimator/Home/Dependent
http://finaid.ucsb.edu/dependent-net-price-calculator
http://www2.ucsc.edu/finaidcalc/dependent.php
http://secure.osfa.illinois.edu/NPC/StatusInfo.asp
http://npc.collegeboard.org/student/app/umich
http://sandiego.edu/admissions/undergraduate/tuition-financial-aid/net-price-calculator.php
http://esdweb.esd.usc.edu/npc
http://osfa.washington.edu/wp/getting-started/net-price-calculator
http://finaid.wisc.edu/award-estimator.php
@JumpyGS I may have a similar issue with a one time royalty check next year. I will prepare for my EFC to go up (CC folks, is income usually assessed at around 30%?) for that next year. Assets, if I’m understanding this correctly, are only assessed at 5.6%. So that might be why the asset in your lower EFC didn’t hurt you as much as the “income” from selling it.
Professor, you can ask your publisher to pay you out over two years. The net result likely the same but at least you’[ve spread the pain…