Income, assets, savings, household size, number of children in college, age of eldest parents and student’s summer earnings.
Financial aid comes from state and federal government and higher education institutions.
1. Need Based Aid:
a. Grants from the college - no repayment
2. Work Study Programs: student must earn, amount able to earn is fixed
3. Loans
a. Perkins Loan:
Need based federal loan, awarded by the university.
Low interest rate with option for cancellation
Volunteer service, law enforcement, nurse, medical, child or family service agency, special ed teacher or teacher at a low income school
b. Subsidized Stafford Loan: low interest, variable rate, need-based aid. Federal govt pays the interest while student is in school and for 6 mos after graduation
c. Unsubsidized Stafford Loan: not as strict to qualify for, interest accrues while in school
d. Federal PLUS Loan: Parents are the borrowers. May borrow up to the cost of attendance minus any financial aid the student receives. Only natural, step or adoptive parents are eligible.
Max interest rate is 9%.
Parents need to go through approval process for loans with a lender
*Max amounts for student loans:
Dependent Students: $2625 for freshman year
$3500 for sophomore year
$5500 for each remaining year
Independent Students: additional $4000 for first and second year, $5000 more after that.
Parents: No limit *Parents should shop around for the best PLUS rates and lenders.
4. Merit Based Aid: Awarded to students based upon their accomplishments in and out of the classroom
-Grades, test scores, community service, talents, sports etc
a. Scholarships
b. Grants
1. The FAFSA- Free Application for Federal Student Aid www.fafsa.ed.gov
To be eligible for any need based aid- loans, grants etc- the FAFSA must be submitted.
2. CSS Profile: https://cssprofile.collegeboard.org/
Only required by certain colleges.
Watch the deadlines- they differ from school to school!
3.Student Aid Report: SAR is returned to the family with the EFC and is given to the colleges indicated.
4. Award Letter: Award letters arrive from the colleges.
The award letter must arrive in time for family to evaluate all colleges awards and make a decision by May 1st.
Can accept or deny any or all.
5. Disbursement of Aid
a. Grants; merit based aid etc through the college- as soon as student enrolls
b. Loans: Promissory note arrives during summer.
After you return it, the Financial Aid officer certifies the amount
Approval by lender
Loan check is disbursed to the college 30 days after student enrolls.
Extra is sent to student.
c. Scholarships: Outside scholarships differ on when they are disbursed.
Always directly to the college
When to file: As soon after January 1st as possible.
Estimating Taxes
College Deadlines
March 1st
Don’t send copies of returns, letters etc.
Use black pen or pencil- no whiteout.
Extenuating circumstances: send a letter directly to the college and meet with the financial aid advisor.
If you do it online- the FAFSA is not complete until the signature page is printed out, signed and arrives at the FAFSA offices.
Dependency
Residency
Scholarships
**Scholarships are gifts. NEVER, EVER pay for a scholarship.**
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