<p>So I recently filled out all my financial aid documents for my colleges, and our FAFSA EFC was fairly manageable, around 16k, so I thought we would be fairly set for college. </p>
<p>However, I recently got back a financial aid statement from a HYPS school (which give some of the most generous financial aid from what I've heard), and it stated that we would be getting zero aid. With a tuition of nearly 60k and our AGI being less than 80k this was very surprising. The reason that the school gave was that since my family owns our home (~500k) we demonstrate considerable financial strength and therefore have no need.</p>
<p>So my question is, would all schools respond this way? Going from an expected 30~40k in aid to 0 was quite a shock. Do any private schools give aid based on FAFSA estimations? It seems that at this point the only way to pay for a top tier college would be to sell our house or take out a huge loan (maybe both). If people have any other suggestions for directions to look at in order to lessen the cost of college that would be helpful as well (I know a lot of scholarship deadlines have passed already).</p>
<p>What are your safeties, and did they offer merit aid? If you can only afford 16k you need to find either a super cheap public, or a place that will give you a nearly full tuition scholarship. There are several threads on those topics in this forum, so scroll down, and you will find them.</p>
<p>I am also surprised by this. I wonder if there is more to the story than just the equity in the house. Does one or both of your parents have business income? This can often lead to a higher-than-expected EFC. If not, and if it is truly just the house … you may find that aid is better at other schools. Each Profile school treats the primary home differently. FAFSA schools don’t count it at all, but of course, they don’t usually meet need.</p>
<p>And selling your home makes no sense (I am sure you were not serious) …</p>
<p>What is the value of your home after taking out all selling expenses if you have to sell right away, like within the month? It may be far less than $500K. So see if that value cannot be changed after discussion with some realtors in your areas. </p>
<p>If your house is worth $500K, for schools that do not cap the value by multiple of income, after the asset allowance is used, the amount attributable to the home equity is about 5.6% which is about $30K. But most top schools do cap that amount at the 2.4X income figure. I’m surprised this school did not do this.</p>
<p>Something doesn’t seem right. Expecting your family to pay $40k+ more because of $500k in home equity doesn’t sound right. What is the equity protection at this school? What is the basic asset protection? Is there any? </p>
<p>It does sound like either the family has a business or a mistake was made somewhere. With an $80k income and a $500k home with no mortgage, that is sounding like a family with a business.</p>
<p>Is this Yale? Since you say it’s a HYPS school, then there is more to this story.</p>
<p>How much do your parents have in savings, unprotected retirement accts, etc? If they have a business, does it have value?</p>
<p>The schools that you are talking about not only look at FAFSA (for federal aid) but they look at the CSS profile (or in the case of Princeton, their own FA forms). Based on what you wrote, at the schools in question, with your famly’s income and normal assets (just the primary residence), you would have received large need based aid.</p>
<p>If the school gave no $0 aid (especially HYPS), they feel that you have considerable assets to draw upon to pay for college.</p>
<p>Are either or both of your parents self employed?</p>
<p>Do you have other assets than your primary residence?
If your family owns your home, perhaps the school says that your are sitting on $500k worth of equity, some of it, which our parents can use to pay for college. Even if they capped equity at 2.5 (80k*2.5=200k), this would leave $300k available for college.</p>
<p>Do your parents have a large amount of money in the bank? Granted, they may be saving this money for their retirement and are saying that it is not available for college. However, if the money is not in a 401k/403b or other retirement account (simply sitting in the bank) the school may consider this money available for college.</p>
<p>*Quote:
. Do any private schools give aid based on FAFSA estimations?
*</p>
<p>Not the schools that give the amount of aid you need, unless the aid is merit based. And, not likely the schools you applied to.</p>
<p>The reason that schools that give lots of aid don’t just use FAFSA is because FAFSA doesn’t tell the whole story. In your case, FAFSA wouldn’t tell the school that your family has $500k in equity. A school that gives lots of need-based aid would want to know that so that it can direct its aid to those with true need. And, if your parents are self-employed, then likely the CSS school “added back in” some of the business deductions. </p>
<p>Since you say that this is a HYPS school, and your posts suggest this might be Yale, then either there has been a huge mistake on Yale’s part or there is a lot more to this story.</p>
<p>To the OP. Colleges that consider primary home equity do not expect you to sell your house. However, they might expect you to borrow against this equity. Clearly your family made a decision to fully pay for a $500,000 home. They could have used some of the money to pay off that home as a savings for your college costs.</p>
<p>That being said…if the ONLY asset your parents have is this primary residence, something isn’t right. Do your parents have any other savings, is this home partially a rental property, are either of your parents self employed? Do you own additional real estate in addition to the home in which you reside?</p>
<p>You cannot assume that all schools will respond the way the first did. However, you can probably safely assume that with such a significant asset, your expected contribution will be much higher than the FAFSA EFC.</p>
<p>The thing to remember…the FAFSA EFC does not take the primary residence into consideration at all. Many Profile schools do, to a greater or lesser degree.</p>
<p>At this point, I would wait to see what the other schools offer. How is it that you have an admissions and financial aid offer from a HYPS school? I don’t believe any have rolling admissions. If this is an EDII offer, you don’t have the luxury of waiting.</p>
<p>Yeah, it is Yale. Do you think other schools would be different?</p>
<p>We do own a business, but last year it reported net losses (-20k). Our total assets outside of the home total to around ~100k, so I doubt that would be the reason. I’m not sure about the business value, but it also wasn’t reported to the school anywhere so I don’t think that would have been a factor in the decision?</p>
<p>I guess for now I’ll just have to wait on other schools for their decisions, thanks for the responses everyone.</p>
<p>That your family owns a business is very likely the reason for this. Many times, business deductions allowed by the IRS are not added back in by schools using the Profile.</p>
<p>Is this an EA award? Otherwise, how would you already have it?</p>
<p>I would just wait and see what your other offers are. Different schools view business expenses in different ways. You will just have to wait and see.</p>
<p>As others suspected, the business is likely part of the issue here. “reported losses” is likely NOT what the school considered, but rather they looked at what sort of expenses were taken on the business to create that loss. So… they very likely added that back to your family income they are considering. $100k savings plus $500k paid off home is certainly a big factor also. </p>
<p>They also may have put a value on the business, so that could play into it also.</p>
<p>*Yeah, it is Yale. Do you think other schools would be different?</p>
<p>We do own a business, but last year it reported net losses (-20k). Our total assets outside of the home total to around ~100k, so I doubt that would be the reason. I’m not sure about the business value, but it also wasn’t reported to the school anywhere so I don’t think that would have been a factor in the decision?</p>
<p>I guess for now I’ll just have to wait on other schools for their decisions, thanks for the responses everyone.*</p>
<p>Yale is a very generous school. Other schools will likely come to a similar conclusion that your family should pay full freight.</p>
<p>Thumper is right. It’s not just the “reported net losses,” but also likely the business deductions.</p>
<p>I thought CSS does ask for the value of the business. Anyone know? </p>
<p>Are you sure that your parents’ only other assets are about $100k? What about retirement monies?</p>
<p>By any chance, is this business a restaurant?</p>
<p>Oops…post 14 should say that business expenses allowed by the IRS are added back in as income by many Profile schools. </p>
<p>Yale is a very generous school. OP, was it just your FAFSA EFC that led you to believe you would receive $30k-$40k per year in aid. If so, agreed with others, the FAFSA EFC really is not meaningful with regards to institutional aid at schools that require the CSS Profile.</p>