@My3Kiddos - I agree with your post up until the last 2 sentences, because only some of the schools take home equity into account, and for those that do, they may only take a portion of it into account, especially depending on the parents ages, but sometimes also depending on other factors like geographic region.
@picktails I think your example is very good here, but I would caution those who might think they might follow your D’s thrifty approach - this is not always possible. Most of the schools that claim to meet full need try to err on the high side of expenses, but there are some students whose books may be several hundred dollars more than the school budgeted for them. One of my S’s friends was taking a higher than normal course load, and found himself in this situation. He went to his advisor, who wrote a note for him to take to the FA office, and they covered the difference.
OP, as a first gen student, you may have a small advantage in admissions to some of these schools that meet full need. But as others have said, do your homework, run the NPC for each of these schools before you apply. It is likely you might find the net COA all over the map. While some of them are willing to re-visit the amount of aid they can offer you if you get a better offer elsewhere, you will find that a school like Chicago won’t match Princeton’s aid, but an Amherst will often match Williams. And you also want to anticipate the future years aid - you mentioned you have other silblings, and these schools aid is for one year - they will recalculate each year, based on your family size, number in college, etc.
@3puppies - There are maybe a handful of colleges that are loan-free at any income and don’t take into account home equity. All other CSS Profile schools include ~5% of home equity in their calculations. Some cap home equity as a factor of income, but others don’t. So a family making $100,000/year with $400,000 of home equity (totally possible if the home was bought 20 years ago before an area became “hot”) could find their home equity adding $6000/year to their EFC at Yale (caps equity at 1.2x income), or $12,500/year at Columbia (cap is 2.5x income) or even $20,000/year at Pomona (uses 100% of equity). All of those schools meet full need without loans. It’s part of why aid packages vary so much.
We have a lot of home equity and found our EFC from Profile schools was higher than our FAFSA EFC and our highest costs came from schools that “meet full need” and don’t do merit awards. One financial aid officer told me that she knew we could get a home equity loan which is why I’m convinced it was the differentiating factor. There’s actually a spread sheet someone compiled that shows just how much home equity impacts financial aid at different schools. Eye opening.
@My3Kiddos - congrats on your high home equity, and kudos to you for discussing the potential impact of it on your EFC with Profile schools. We don’t have as much home equity nor income, but we still have a nice amount - enough to matter in the FA offer differences. We hadn’t done as much research into these differences when S had applied to his list of schools, but we had learned from the experience and had many more conversations with FA officers when D went through the process. I agree that this can be eye opening.
I was never concerned about colleges being loan free at any income. We are only concerned if they are loan free at OUR income. So the list we looked at was more than just a handful. I was not concerned about the fact that my pups could have gotten a full ride at some schools if our income was only $10K lower at some schools - and more than one of these schools would have cost us more than $10K. In one case, earning $10K more meant $12,100 more cost at the same school. We only noticed this problem because we initially weren’t sure how to use the tools. But despite wanting to know how it works, what really matters is what the numbers are to our situation. To us, these schools are being VERY generous.
I recall a discussion with the FA officer at Pomona, because it was one of S’s finalist schools. They admitted that they generally include 100% of home equity as a parental asset, but they also told me that this also may depend on the parent’s age, income, how the property is taxed, and other variables. She told me that if a family has a $1million home in Indianapolis, where both parents were working but aged 45, could be viewed differently than a family whose parents were both 62, and who lived in a $1million home in San Diego. While each case is viewed independently, it was clear that they wanted DS and they were willing to sharpen the pencil. At this level, none of these schools wants finances to be the sole reason someone chooses to go somewhere else.
How does this happen? It’s hard for me to imagine a realistic scenario where the need-based financial aid drops by more than a dollar for every additional dollar earned.
@BelknapPoint there are some colleges that do have a line in the sand where student are offered more generous need based aid…than families that earn more than that line in the sand.
At the time, it was explained to me that under a certain income level the school uses an alternate formula, that I presumed did not look at the same variables. I am not sure if that school still does this, or if they have since tweaked their other formulae as well. But this was not the only school where we found this anomaly.
I recall asking because at the time, DH’s employer would have allowed him to take a year end bonus on 12/30, or a slightly higher bonus on 4/1. Deferring it was better for our FA situation, but we had medical expenses so we had to take it earlier.
It is just as @3puppies stated: many deep pocket schools may have a two/multi-tier approach to financial aid. It is very easy for a few dollars to move you from one financial aid policy to another.
Based on what you posted, the person who makes $100,100 (and possesses typical assets) will not be automatically granted free tuition – but will still be eligible for scholarship consideration. Do you really think that going from an income of $100,000 to an income of $100,100 will mean a Dartmouth scholarship reduction of $51,000?
Yes, seen it happen to some of my students, who were slightly over the threshold. They still got a good package but they did not get the full tuition. some asked for a financial review based on better offers from peer schools.
That happened to you? Or someone told you that it happened to them, and it was believable? Because, for a school like Dartmouth, I’m highly skeptical that the need-based aid formulas would be structured to allow $100 more in income to result in a $51,000 loss of institutional grant money.
Edited after seeing your edit: yes, this is how it works. More income/assets = less calculated need.
It doesn’t mean necessarily losing the full $51K in aid. In my earlier post, I was referring to a difference between earning $85K and $95K meant dropping from $55K in grants, to $42,900 in grants. Still a great deal, and we would have been very grateful for it, but the optics of $10K additional earnings resulting in a reduction of $12,100 in aid, was very puzzling. Again, this was a few years ago, and it would not surprise me if they have since modified their formulae, but I can assure you this was very much the case when we ran the calculators.
I would hazard to guess that this was the result of a poorly written program/formula, and that a $12,100 reduction in need-based aid due to an income increase of $10,000 is certainly not the result that the financial aid office at a reputable college intends or would want an applicant to experience. At a reputable college, pointing out such a result would in all likelihood lead to some quickly exercised professional judgment.
IIRC…UVA changed their no loan policy a few years ago. It USED to be no loans for everyone… yet then changed to no loans only below a certain income level. Above that income level, loans are now packaged into their full need financial aid packages. And it was a firm line in the sand income level.
They still meet full need…but above a certain income level…student loans are now included.