<p>Which case gets a student more aid through CSS?
1. Mortgage payment $1800, and loan on that house is $35k. House is valued 600k.
2. Mortgage is $2800, and loan on that house is $20k. House is 600k.</p>
<p>Thank you.</p>
<ol>
<li> Net equity is (600-35)= 565K</li>
<li> Net equity is (600-20) = 580K</li>
</ol>
<p>It’s impossible to say which scenario would net more aid for CSS Profile schools. The reason is that schools have their own formulas for determining how much home equity adds to the expected family contribution. Some schools cap home equity at 110% of income, in which case the difference between $565K and $580K is irrelevant.</p>
<p>There was a thread recently comparing some colleges’ policies on home equity that you might search for.</p>
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<p>These numbers don’t make any sense to me. A $20K loan with a $2800 payment would pay off in about 7 or 8 months. And why would the smaller loan have a higher payment?</p>
<p>If the loan amounts are correct, it is only a $15K difference in equity, which translates to only around $800 difference in aid at max.</p>
<p>Seems to me that the smaller mortgage would give you an extra $12K per year in cash flow that you could use to pay for college. Your debts don’t get counted when calculating aid, so you are better off with the higher cash flow.</p>