<p>I'm trying to let my college know that my financial aid award is not enough for me to practically attend. Would telling them that my family already has a home equity loan (2nd mortgage) help or hurt my chances of getting more money?</p>
<p>Not enough information here.</p>
<p>For my best stab at it, if your school is FAFSA only (CSS Profile not required), it will make NO difference to them, as they base their awards on non-home assets and liabilities. How you finance your living arrangements is not a consideration (rent vs. home ownership with or without any equity). It may not seem fair that a family who owns their home outright (no mortgage) pays the same as a family who has payments on a first and second mortgage, but consider the following 2 families each earning $100K per year and a FAFSA EFC around $20K: Family A owns a humble $100K home in a questionable part of town with no mortgage. Family B owns a $500K house with $300K first note and a $100K second note. Their mortgage payments are $2500 per month (in debt up to their eyeballs). They enjoy the nicer neighborhood, greater square footage and amenities of the $500K house. Why should Family B get a better FA package than Family A? </p>
<p>Now if you are at a CSS Profile school, they already asked your home value and your indebtedness. If you didn’t include that 2nd mortgage in your CSS Profile application, by all means do so now and appeal your award. </p>
<p>However, if you have structured your mortgages where you have a large percentage of your mortgage on short-term (usually 2nd) notes and have a cash flow problem because of the higher payments, CSS Profile doesn’t take that cash flow into account, as they are not subsidizing your payment of principal on your notes. </p>
<p>Welcome to the world of incentivized FA awards. Unfortunately, those who don’t learn the rules of the game in advance and prepare accordingly play at a disadvantage.</p>
<p>WOW! Thank you so much for a thorough response. It is indeed a CSS profile school, but we were unaware that the second mortgage should be included. That was just the information I was looking for! Thanks again! =D</p>