<p>^^Good advice to see if your financial aid office will view as an asset. OP if you are returning home for the summer do get in and sit down with one of the school’s financial aid officers before the end of the semester. They are not scarey people and they will give you a straight story. They do this all the time. The probability is very high that your family will need to pay more next year than they did for your freshman/sophomore years. It would be important to give your parents some time to figure out how they will make it work so if you can help by getting a “picture” of the situation now it will be helpful. Bring copies of all your documents and yes, if they used some of the money for unusual medical bills bring that with you also. Unforuntately all the posters above are correct and paying down consumer debt or a mortgage will probably not factor heavily into any decision making. The only “good” thing is if everything stays the same your senior year may more closely resemble your freshman/sophomore year and your parents theoretically will have better cash flow from paying down debt. It’s a shame they couldn’t have stashed some of the monies in anticipation of the impact on your junior year but perhaps they felt it was more important to pay down the debt now and they should have slightly better cash flow now. Also, if you are going to be a junior and if you are a “good” student, check with your department, perhaps their is a scholarship you might qualify for as a junior.</p>
<p>The OP states:
“All I know is that my great grandmother sold the farmland that was in her name and split all the profits evenly among her grandkids.” </p>
<p>Possibly this $125,000 is considered as unearned income to the student, not the parent. If the student is under 18, then the parent may have needed to sign the paperwork, but the money may be considered the child’s asset. If it was spent BEFORE filling out FAFSA, then it should not have been reported as an asset. It’s possible, though, that the money was still in an account on the day FAFSA was filed (if done early in '10). Even if the $ was spent the very next day, it would still be counted. And although inheritances CAN BE ignored as unearned income through professional judgement, not all schools do this. I’ve seen this done with inheritances, but I don’t think this is NOT an inheritance (more like a gift IF great grandma is alive). </p>
<p>Income and/or Assets in the child’s name would severely impact the family EFC.</p>