<p>When calling our CC, I ended up with a newbie who seemed to be reading from a script and couldn't answer my question with any authority. While I continue to try connecting with someone whose answer I trust, I want to see if anyone on this forum has had experience with this.</p>
<p>My 2012 income was very inflated for a couple different reasons. We ended up with $0 Pell Grant. I will most definitely complete the special consideration form once they make it available. They won't even look at the form, though, until we accept the financial aid award offer. The financial aid package being offered by our CC is an unsubsidized loan and nothing else. If I reduce the amount to $0 accepted on this loan when we accept the aid package, will they even look at our special consideration request? If we resort to a loan, we will go with a home equity loan rather than a 6.8% unsubsidized loan, so I really don't want to accept it.</p>
<p>Community colleges here dont even partipate in the Direct loan program so financial aid is only Pell Grant & work study.</p>
<p>Can you afford tuition without the loan?</p>
<p>A couple of things. First, do you have a way to pay for this college? Second…your special circumstances consideration could be denied. These are done on a case by case basis at each school. Despite your request, it could be denied. </p>
<p>If you feel comfortable that you can pay the costs without the loan, then don’t accept it. </p>
<p>However, understand that your special circumstances review might net you only a subsidized loan. Then what? Community colleges don’t meet full need, and loans are very typically part of the package. The school would need to adjust your FAFSA EFC to below $5000 to get any portion of the Pell grant. That might…or might not happen.</p>
<p>I would rather borrow from my 401K or take out a home equity loan than accept their 6.8% unsubsidized loan. My fear is that they will view not accepting the unsubsidized loan as a lack of need. That is not the case.</p>
<p>My son will be in a vo-tech program. He really should be eligible for an Iowa grant that is specifically for vo-tech. Unfortunately, the highly inflated EFC of $16,000 made him ineligible for grants. My 2013 income will probably come back with an EFC near $0. Not fair to him to make him take a year off before going to college for that reason, though.</p>
<p>If this is a valid concern (I have no clue one way or the other), can’t OP accept the unsubsidized loan for now, then repay it as soon as the equity line is arranged? (I do realize there may be an upfront cost for the unsub loan that would be incurred in this scenario.).</p>
<p>Is the 529 for a different child?</p>
<p>You said this is for a vocational program. How much does the school cost and how long is the program? </p>
<p>If the amount is not that big I would go with the unsubsidized loan. You can begin to make payments right away.</p>
<p>Dana, another thought. Do you want the loan to be in your name…or your student’s. A home equity is yours and your student is not obligated to repay it. A direct loan is the student’s. The home equity will need to be repaid starting rights after use. The direct loan is deferred u til graduation or ending college (although I would suggest paying the interest as you go).</p>
<p>But that is digressing from your question.</p>
<p>No, declining the unsub loan will not hurt your case. </p>
<p>You are asking for your financial situation to be reviewed. IF there is sufficient evidence to allow the aid officer to make adjustments to the items in the EFC formula, and IF those adjustments change your EFC in a manner that will result in increased eligibility for Pell or sub loans (or SEOG or university funding), you will be awarded that money regardless of whether or not you accepted the sub loan. Know, however, that sometimes even if the elements of the EFC formula are adjusted, the result does not always net grants or even increased sub loans … it all depends.</p>
<p>Thanks, kelsmom, for answering the question asked. I appreciate your input!</p>
<p>Thanks everyone else for your interest as well, but my point is that I do not want a 6.8% loan that starts charging interest on day 1 when I can get a much better rate borrowing from my 401K.</p>
<p>
If you lost your job, you have to pay back what you owe to 401(k) in a very short time. However, you kid will have all kinds of payment plans for his/her student loans.</p>