While I know that some states have standardized aid, in my state, aid policies vary by school. It wouldn’t be possible to have a standardized calculator.
@ucbalumnus even within states, the application requirements for financial aid differ amongst public universities.
UNC-CH meets full need and requires both the FAFSA and Profile. None of the other public in NC meet full need and no others require the Profile.
University of Virginia, ditto. Requires the Profile and meets full need for all. None of the other publics in VA do either (not sure about William and Mary, but the many other VA publics don’t meet need and don’t require Profile).
University of Michigan…meets full need for instate students and requires the Profile. The other MI publics do neither.
Even within some states, there is wide variation in what their public universities require for financial aid application info, and the need amounts met.
Not a one size fits all!
And it meets full need for out-of-state students with AGI <$95k.
When applying EA (non binding) to a school, must you apply for financial aid at the same time or can you apply by the regular decision date?
Always look at the school’s financial aid page for their individual deadlines. Only if financial aid is not at all important would it be wise to wait to apply for aid. That said, a student can apply at any time if all they want/expect is loans. But applying in a timely manner will yield the best possible aid given an individual’s situation.
@RockyPA I’m not @Kelsmom, but both of my kids applied EA to colleges. In both cases, they had schools that had priority financial aid filing deadlines for EA applicants.
So…read each college website.
If you are applying EA, you presumably want to know the admission and FA status early. So apply for FA by the deadline the college lists for EA applicants.
@ucbalumnus
EA applicants don’t need to be in a hurry to find out financial aid as EA is not binding and a matriculation decision doesn’t need to be made quickly
One of the reasons to apply EA is to pick up an early safety if the result is admission with sufficient FA. This would allow dropping applications to any colleges less desirable than the EA-admit-with-enough-FA college. Not getting the FA until later means that an EA admission is not a complete decision that would allow dropping other applications.
My son did EA with one music school a few years back and the school asked both FAFSA and CSS at the same time as EA application deadline. His acceptance came with an initial financial offer by Christmas. It was good to get FAFSA / CSS done very early. The particular school corrected our EFC and lowered EFC about $5000. Later, all other RD schools used the revised lower EFC to make him offers.
@kelsmom I’m surprised by how high the interest rates are on parent plus loans. With the interest rates on a home equity loan significantly lower, that, on the surface, makes more sense. Are there any consequences for taking a home equity loan or loan from a well-funded 401K instead of a parent plus loan? Would that hurt EFC, for instance, by being added back to income?
Parent borrowing is really a decision that varies with individual family circumstances. If you do a search on CC, you will find some good discussions on the subject. We have some very knowledgeable parents who have weighed in on the subject. If you have trouble finding what you need, start a new thread on the Financial Aid forum. There is sure to be a lot of back & forth.
In terms of Parent PLUS loans, there is a hefty origination fee (4.236%), and the interest rate is higher than what some parents may pay if they are able to borrow elsewhere. It is relatively easy to qualify for the loan, which is important for a lot of parents. In addition, if the parent borrower becomes permanently disabled or dies, or if the student dies, the loan can be forgiven.
Be aware that if you take money out of a qualified retirement plan like a 401k, it can show up on your tax return and can increase your EFC for future years. Borrowing gets around that issue.
Make sure you do not trigger a distribution that can affect financial aid. I’m just dealing with a situation where a parent used Roth IRA money to pay for some college costs Back a couple years ago for one kid and it’s going to have to be reported as income on this year’s FAFSA
Ouch! I would encourage them to try to get a professional judgment for one-time income on that. It’s worth a try if it might make a difference in aid.
Thanks! It’s a bad situation. Divorce. Without that danged withdrawal kid would be eligible for some PELL , and with the Direct Loans and part time work would make it just. affordable. I don’t see this college throwing in any money out of its own coffers.
Definitely worth pursuing for the Pell (and maybe more in sub loans). I had no issue removing one-time income for this sort of thing.
For one, a HE loan or LOC is a secured loan. If things go really south, you can lose your house. Also, federal loans have benefits that HE loans do not. You can defer payment until the student graduates. The interest on a federal student loan is tax deductible. Federal loans can have offer forbearance if needed. And most importantly, a federal parent plus loan will be discharged upon death of the parent or student. And I believe it can be discharged upon disability of the parent.
The other reason it might be preferable to take a federal loan is that you may be able to deduct some of the interest on such a loan, you can pay up to $10k of such a loan through 529 and get some state tax savings if your state allows you to deduct 529 contributions, and there is Some flexibility of payment on these loans that a HELOC would not have. Also, you can only take these federal loans while you have a kid in school. They would not be available later. It might be wise to leave the home equity for possible emergency tapping later.
That’s all in addition to the reasons @brantly has listed.
IIRC, didn’t the law change so you can only deduct HELOC interest now if it’s related to your primary residence – not for school expenses. When my sons were in college, it was still deductible.
I am going back to school in the spring to pursue a Master’s degree, at a cost of either $37k or $45k depending on which program I end up in. How, if at all, does that factor into how I complete the FAFSA and CSS for DS21 who will be a freshman in college next fall? Can I consider myself to be a second college student in the family?
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