Do you qualify for plus loans since you say you can’t get a Heloc?
You are planning to take Plus and refinance your house?
I just said that. I also said I would lay down in traffic to let my son go away to college.
You said in a prior thread that you wanted LACs in the midwest, and here you said you have a few that have given your child (children?) $60k. That’s what I meant by make it work. Focus on those schools as they are probably the best offers you are going to get. If a school is giving $60k, how much more do you need? $3K? 6$? Work with that school to get that extra. Apply to local scholarships or have your child earn that much.
Just a few years ago the schools were expecting students to earn about $3k over the summer. Well, minimum wage was $7/hr back then and in many places, including California, it is well over $15/hr now. Denver minimum wage just went to $15.77, so every lifeguard is making that or more (my nephew used to get $25-30 for teaching private swim lessons, plus tips). My 16 year old nephews make $50 per game reffing, and often make $500 in a weekend. And they are banking it all for cars and college and super expensive skates they like. Your kids can do it.
Agreed. Especially if they each work full time during their gap year.
no we can’t. we have to borrow, you are just spouting things out without context. there is no freaking way we can come up with 44K together every year for four years.
your nephews banking for cars or whatever, that’s in a different reality. Good for them. Has nothing to do with us.
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Do these twin have a second parent who works? What does this parent say about this plan? When we were planning college and finances, both parents worked to find schools, and figured out the financing.
This was important because any loans or whatever…would affect both of us parents in the future.
In the Thumper family, both parents worked full time and this helped finance college.
Kids can make $18/hr working at Starbucks these days. There is no reason why your kids can’t work full time in the summer time and help with their college costs. . I believe that was twoinanddone’s point.
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Yes they can work, but its not going to prevent loans from being taken. They can’t make 22k so I’m back to the original question, progress on which has been made considerably on this thread, on one way to borrow that can work.
Spit and grittle alone is not going to work. Some thought and planning is necessary and there’s been a lot of help with that here.
Now maybe if we had Moxy!
You said you didn’t need $44k/yr, that you need $20k.
I wasn’t saying $44k, I was saying $6k or whatever the difference was between your $60k scholarship, the $5.5k direct loan, any other savings or scholarships they get. How much is THAT number?
My daughter wanted to go to a school that cost $52k (then $55k, then $58k, and finally $60k) Umm, no. So she got her ACT score up (yes, bad test taker but worked like crazy to get it up), not first in her class but respectable, and she got a good $20k merit scholarship. Okay, what else? Got a $3300 state merit grant. Got a residency grant of $3000. Got a $2000 scholarship from my father’s fraternity. And finally got a $20k athletic scholarship. We needed every dime because I didn’t have a house to borrow against and I would NOT borrow against my retirement. Her sister didn’t have an athletic scholarship but did have a talent one, and picked a MUCH cheaper school. Sister has student loans. They searched for these scholarships. THEY made it work.
But back to your original question on this thread - no, you can’t prepay the mortgage with the money you are borrowing on a refinance. Doesn’t make any sense. If you prepay things with the 2nd mortgage, you won’t have that money to pay tuition in years 2-4. Sometimes (not always) on a HELOC you can reborrow the principle, but not on a 2nd mortgage. If you borrow it and let it sit in your bank, you need to list it as an asset on FAFSA and CSS. If you don’t qualify for PELL grants, it may not matter.
We’ve thoroughly discussed all that already and found some solutions that work and some that don’t work. There’s no reason to bring up the things that don’t work, like pre-paying a mortgage, which wasn’t the original question.
Glad you can make it work, with athletic scholarships, etc. Glad you got all those things and you were able to raise test scores and everything. And got scholarships. That is definitely the way to go if it can happen.
We are in the running for some scholarships and possible admission to a needs-met college, but we’ll see. I have to plan for that not working out, because that is a thing that happens too.
OP’s kids won’t qualify for Pell. On another thread they stated a household income of 140k.
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I don’t think anyone is saying prepay mortgage months in advance, but to make sure to get all payments out the door that he can reasonably make prior to reporting assets. I do think it’s possible to pay a bit forward as I’ve done that before for tax reasons in Dec. OP can explore that.
I think if the conversation with FA happens, it’d be worth mentioning the need for a lot of loans. That might move the needle a bit if the FA office has any wiggle room. I do agree that negotiating with a competing offer in hand can be effective at some of these schools.
As far as the cash out refi, if I’m getting the picture right you have a decent pension and likely SS? Probably good disability and life insurance? And the ability to work longer if needed. Not to mention a house in CA and likely a decent amount of equity? As long as your future income can cover the increased mortgage payments I don’t see this as very risky at all. Especially with historically low rates that’ll likely look great in ten years.
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I’m having a hard time following along.
So is the school picked out? What’s the per year price - $22K…or that’s what is needed but it’s more?
Humboldt is less than $25K, for everything. Cheaper in the dorms than off-campus, which is different than almost everywhere. And no expensive plane tickets to get back and forth. If you can pay $16K, kids get jobs, and you take out a small loan, why not? My senior is earning $600-700/month at her 12-hour/week job. She’ll work even more in the summer.
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Is OOS an option - Truman State is $27K and has scholarships from $4-$8K - starting with a 23 ACT (yes they have to test).
yes this is the financial situation exactly. I decided to find a half way point between equity and plus loans.
thanks for not only clarifying things but also adding some thoughts about negotiating with colleges that I didn’t know and which might be useful. I definitely need to start another thread on that topic and also comb older ones.
yes humbolt is 25k but other things are less than that, and it’s kind of too much.
I didn’t mean I can pay 16k myself, I just meant that is a reference point where we’ve got about as much as we can hope for and now it’s time to start borrowing to get to 16k. It’s most likely getting down to 16k or so requires heavy borrowing and work from my children also. This is certainly so for my son.
One can say Humbolt is only a few thousand more than other options, but then you can say something is a couple thousand more than that, and so on, until one has creeped way up.
I need to creep down. so 25k is not the way down.
This thread is premised on the idea that I need to find 32 myself, and borrowing to help pay that every year for four years.
the 22k (including indirect costs but without loans) is the best offer so far, from one college, for my son only and is the current standard. We need to creep down from that if possible through various means. I believe there is a strong chance that a couple schools might match that for my son. He won’t do any better in the U.S. He may go to Europe to avoid his loans but that’s a complicated issue TBD. Home equity cash would be essential to him having that option, but still necessary to help cover the 22K should he stay in the US.
My daughter, who is the stronger candidate, does not have such an offer yet to use for negotiation (best is maybe 24k), but she does have a slightly lower cost if she goes to U of Arizona on auto merit that my son wouldn’t get close to.
So 22k is just a way of ball-parking what we are going to have to meet with loans in our planning.
It could be less. My daughter could hit some lotteries and also scholarships she is in final round for.
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