My family has a decently large amount of home equity on a high-valued apartment. Also, would the fact that the apartment is now “worth” much more than its price was when my parents purchased it (due to gentrification) throw off net price calculators compared to actual financial aid packages?
There are MANY colleges that meet full need for all. Could you maybe be a little more specific? What colleges are you talking about?
Also, your family income is the driving force in determining need based aid. If that is above a certain threshold, you might not qualify for institutional need based aid anyway.
The worth of the apartment NOW is what will be used for determining equity innthat aoartmwnt…not the pirchase price years ago.
Is this your primary residence?
Any full need school in the eastern half of the United States that isn’t extremely rural. I haven’t visited many colleges yet so I’m unsure of the exact type of environment I’m looking for.
Yes, it is my primary residence. I am aware of the other things you mentioned—I’m making this post based on what I have seen from net price calculators.
Well then…here is a way to compare.
Run the net price calculators at. Variety of colleges with all values being the same and the ones with the higher costs likely are using more home equity.
You can also play around with the NPC…reducing the home equity amounts…and see what happens on the NPC.
I’m assuming your parents are NOT self employed, divorced, or own other real estate.
This should help you:
http://www.thecollegesolution.com/will-your-home-equity-hurt-financial-aid-chances/
Is that apartment an investment rather than your primary residence? If so, all school would consider it as asset value. If it is your primary (and only) residence, then only schools require CSS profile (or school specific forms) would ask for equity information.
I’m reading a book that suggests using the federal commercial property calculator at finaid.org to determine the present value of the home.
Some schools are going to screw you over for having a lot of home equity - at least that’s my experience. I had a conversation with an actual financial aid counselor at one school who told me, “we know you can take out a home equity loan to cover the cost.” Do the NPCs and see which schools come out better. There’s really no other way to know for sure.
I think only the tippy top schools with huge endowments put caps on home equity. I don’t remember if there are any that don’t consider equity at all…maybe Harvard? Look at its NPC.
Others can chime in here, but aren’t there a few top schools that have some limit to how much equity is considered…like 150% of income?
Tell us…how much is the home worth now? And how large is the mortgage against it? We need numbers. Are we talking about…1 million dollar valued home, with a $500k mortgage? More? Less?
There are a number of schools that don’t consider primary home equity at all when computing need-based aid. Other schools will cap equity at a factor of income (1.5x, 2x, etc.), and some consider the entire equity amount. Information on many specific school policies is available in the link in post #4 of this thread.
I don’t want to give too much personally identifiable information but let’s say the value is roughly what you just said.
We are middle-class (mid 5 figures) with a lot of equity, both from appreciation and from the mortgage being almost paid off. Our home equity is almost 10x our annual income. Running the NPCalculators at the meet full-need schools D17 was considering suggested that they all capped home equity. Financial aid packages were close to or better than what the calculator predicted. I suggest you pick 5 to 10 schools, create a profile, and run the calculator at all of them. Once the profile is created, it goes pretty quickly. Good luck.