<p>We are almost 60 and have rental property (3 small office buildings) as our primary source of income - all have dropped in value dramatically over these last few years. Our AGI is below $10,000 this year due to required maintenance, lawyer fees on a dismissed lawsuit, etc. We have no qualified retirement funds but have approx. $200k in stocks we had planned for our retirement. There is not enough equity in our own home or the office buildings to allow us to borrow against them. A business we own 14% in has lost money over the last 2 years (over $400K just this last year) and we cannot cash out of it - no one would buy it. Nothing is liquid... the CSS calculator said we could contribute over $80,000 towards our son's college. How can that be - we have little income and can't refinance or get equity out of anything! FAFSA stated a much smaller (and doable) EFC. Our son is a top student and recruited athlete and will end up at either Middlebury, Tufts, Bowdoin or Macalester - no merit aid... How do we handle this - write letters to the Financial Aid offices??? Tell him its a state school??? We do not live "large" - little to no travel, no expensive cars, etc. We are a little shell-shocked by the CSS calculator. Any advice would be greatly appreciated</p>
<p>Your S needs to look around and find a financial safety, as all kids should have. This is a school that he/you can afford, even if he isn’t offered the aid that you & he feel he should qualify for. Many times, this can be an in-state public or a private known for giving significant merit aid to students like your kiddo.</p>
<p>Have your S go in & work with the CC/GC at this HS to find a financial safety school NOW. Many schools DO give merit awards, but it doesn’t appear that your S applied to any of them.</p>
<p>Do all the Us your S applied to require the CSS calculator or are some only FAFSA? When will he hear back from all the Us about their financial packages?</p>
<p>* FAFSA stated a much smaller (and doable) EFC. Our son is a top student and recruited athlete and will end up at either Middlebury, Tufts, Bowdoin or Macalester - no merit aid… How do we handle this - write letters to the Financial Aid offices??? Tell him its a state school??? We do not live “large” - little to no travel, no expensive cars, etc. We are a little shell-shocked by the CSS calculator. Any advice would be greatly appreciated *</p>
<p>Did your son apply to any FAFSA only schools besides his state school? Did he apply to any schools that give merit? Did he apply to any schools that give athletic scholarships?</p>
<p>For you to have a CSS “family contribution” of $80k from calculators, that means that you have a tremendous amount in assets. Or, you made a mistake somewhere. Or, some of your deductions don’t count in CSS formulas or something like that.</p>
<p>You can try contacting the FA offices, but having assets is a hard thing for schools to overlook.</p>
<p>What was your FAFSA EFC?</p>
<p>He has a safety school that he has been offered merit (Washighton and Jefferson) but he has been heavily recruited for his sport and wants to be at one of the colleges mentioned previously. The FAFSA EFC was $3,500 due to low income. I know we will have to cash in our stocks (i.e. what we had planned for our retirement) but then we will not have any safety for our old age… There is over $1.5 million is property assests but we can’t refinance or pull money out - ratios aren’t good enough in this economy and the banks won’t let us…</p>
<p>It sounds like for FAFSA only schools you qualified for the simplified needs test where assets are ignored. So with such huge assets a FAFSA only school is a hugely good deal for you considering how high your assets are.</p>
<p>Schools that give generous aid from their own institutional funds do not use simplified needs when looking at your assets. The reason the require CSS is because they want to see what other resources a person has that FAFSA may ignore. With assets in the $1.5 million range no CSS school is likely to offer you need based aid.</p>
<p>It sounds like he can try TALKING with the schools who are heavily recruiting him and explain the family situation, but as swimcatsmom said, schools are unlikely to ignore the $1.5M in assets. An option your S could consider is accepting his safety school and consider transferring if your financial situation improves. As you state, it’s important NOT to jeopardize retirement assets, especially if you/H plan to retire any time soon. You will not do S or yourselves a favor by incurring huge debt to finance your child’s U, especially when he has other options. Our kids can’t always have what they want or who wants them when there is a lot of $$$$ standing in the way.</p>
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<p>This is why your Profile family contribution was so high. I’m not sure how your FAFSA EFC was so much lower. Did you LIST these properties as assets on the FAFSA? $1.5 million in assets would yield an additional $84,000 in family contributions (per FAFSA at 5.6% of the asset being tapped. Did your family qualify for the simplified needs test because of low income and receiving a means tested benefit (e.g. food stamps)? With rental income coming from the properties, you would not be able to file a 1040a or 1040ez I don’t believe.</p>
<p>Most families do not have real estate properties worth 1.5 million dollars. This is the reason your family contribution is so high. </p>
<p>Agreed with others…a school where your son receives either significant merit aid, or a school that might offer him an athletic scholarship would be worth pursuing.</p>
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Thumper makes a good point. Did you qualify for simplified needs by some means other than income plus filing a 1040a/ez?</p>
<p>Another question–if the $1.5M value of the property you mentioned your EQUITY interest or some other much lower figure. If you have equity of $1.5M, you should be able to borrow against it. If that is not correct, perhaps you did not complete the forms correctly?</p>
<p>As far as equity loans…as recently as this summer we were advised that many banks were not writing equity loans for multi-family or commercial units when we took a look at one of our rentals that has been on the market for well over a year and we had substantial equity with… so it’s possible the OP knows they cannot borrow against their rentals. It’s still a mean mean world in parts of the country… FAFSA schools sound like a better financial deal for this family if in fact the skip logic works to their advantage. Regardless big assets low liquidity is a big hurdle and requires a different thinking to college selection. It’s definitely worth approaching the private colleges considering the athletic commitment before throwing in the towel…</p>
<p>The equity is spread out over the 3 properties - two have such little equity left (less than 20%) because of the real estate decline that no bank will give us a refi or equity line of credit. Also both of these have single tenant and that is the business that lost $400K and may be out of business within the year (hope not!). The 3rd property has the most equity, but has a $150,000 penalty for refinancing and the line of credit is almost maxed out due to the replacement of the HVAC system last year. Would hate to incur a $150,000 penalty just to for college tuition… If we explain this all to the schools (and coaches) that really want him do you think that will make any difference? Our daughter had gotten significant aid the last 2 years (she is graduating this May) but it was a school that only required the FAFSA. When I filed out the FAFSA this year for our son, it said I could skip the asset portion and I did since I figured the colleges had the CSS (all the colleges he applied to required both). Thaks for all your advice!</p>
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<p>Most folks who qualify for need based aid do not have assets in this range at all.</p>
<p>As noted…on the Profile…did you list the market value of these properties minus any outstanding mortgage on them…or do you own them outright? In these posts you are saying that they are worth a LOT less than $1.5 milliion. Why the discrepancy?</p>
<p>If the FAFSA allowed you to skip the asset portion it is because someplace you indicated you either were eligible to file the 1040a or 1040ez OR you received a means tested benefit OR you were a dislocated worker. </p>
<p>Also previous posts indicate the you had the SAME issues when an older daughter went to Wash U. You were able to get more aid for your daughter…perhaps the same strategies would work for your son.</p>
<p>We talked to the Financial aid officer at WashU (back when the school had more money) and reiterated that the properties and stocks were for our retirement since we are self-emplyed and had no IRAs or company-sponsored retirement plans… They were wonderful about the situaion and aid (they also have a great endowment) and our D also got merit based aid. We had hoped our son would want to go there, but he didn’t like it as much as the small East Coast LACs. Since we had never filled out a CSS we hadn’t a clue about the differences…</p>
<p>I don’t understand how you were able to avoid listing your assets on FAFSA. How did you qualify for simplied means testing?</p>
<p>the one property has almost a million of equity but that’s the one with the $150,000 penalty for refinancing… If it didn’t, we would do just that to help pay for the tuitition. We have had some vacancies in the building (it is small - this was significant) and therefore it has affected our income.</p>
<p>andio…did you qualify for the simplified needs test? If not, your properties would have been required listings on the FAFSA (as well as the Profile) as FAFSA asks for all real estate that is not the primary residence.</p>
<p>Also, Wash U requires the Profile. How is it that you have never needed to complete it up until now?</p>
<p>“no IRAs or company-sponsored retirement plans”</p>
<p>Depending on how your income is structured, you may be able to create SEP, SIMPLE or Keough retirement funds for yourselves. That way your stocks would be held in a retirement vehicle rather than in a normal investment vehicle. Talk to your accountants and find out if this is possible.</p>
<p>*the one property has almost a million of equity but that’s the one with the $150,000 penalty for refinancing… If it didn’t, we would do just that to help pay for the tuitition. *</p>
<p>You can probably avoid a penalty by taking out a second mortgage and leaving the existing mortgage alone. You shouldn’t be penalized if another lender gives you a second on some of that equity.</p>
<p>Didn’t have to list assests on FAFSA I believe since i am a dislocated worker - an interior designer and NO ONE is hiring mid-level designers right now 
We were never required to fill out a CSS for D - must be school required after she first got accepted almost 4 years ago (my - it’s gone by fast). Talked to hubby - the current loan on the property with the most equity is a “conduit” (???) loan - precludes ANY second mtg. or larger refinance for length of loan. We have 7 years left on it - got it at low rate for a commercial property but had these major restrictions on it. Didn’t know in 3 years that we would be in this situation with our son or would have gotten a more conventional loan which would allow us some flexibility…</p>
<p>Wash U has their own financial aid application for that can be used in lieu of the Profile. It is free:)</p>