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<p>That is correct, but when we looked at the problem, we saw a multitude of potential problems that could affect the potential outcome negatively. Although I was not trying to hide the UGMA and avoid a high EFC (100%); The best solution that I could come up with was to manage our cash flow and minimize investment risk in the UGMA and other investments. </p>
<p>We looked at the EFC calculators (had to refresh the exercise again last night) and saw for our situation, that a + change in UGMA resulted in a 5:1 affect in the the EFC: A $1000 gain in UGMA = +$200 in the EFC. The opposite or a - change also yielded the same result: A $1000 loss in UGMA = -$200 in the EFC. I’d like to take the EFC gain all the time but would be devastated in the loss in the investments even though we would have a lower EFC.</p>
<p>Eventually we took massive PLUS loans and a relatively small 2nd mortgage. Both were essentially a way to offset the risk in the UGMA investments rather than try to manipulate the EFC. I would be very careful in looking for additional grants and scholarships by attempting to change EFC by asset reallocation. So,we did what, goaliedad #111, suggests by taking a home loan as a hedge, and understood that the costs was substantial but reasonable in knowing that we guaranteed cashflow.</p>