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Financial Aid - looking toward the future for DS


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After reading some of the threads about merit aid and knowing what I now know about DD's GPA requirements for her merit aid, I looked at DS's #2 choice to see what it offers.

 

I wish I hadn't looked. The price tag for out-of-staters is $21,000 more than for in-state applicants. The school's financial aid page states that in-staters are funded 100% of their need, which includes loans. Out-of-stater's need is met at 80%.

 

The main merit scholarship available to all candidates has a GPA requirement of 3.5 in the Honors program and the student must not have received any disciplinary action.

 

The FAFSA is not required for merit aid but the school has its own scholarship/merit aid application which does not ask for financial information.

 

58% of the students receive need-based aid. The average 4-year debt of students is a bit more than $22,000.

---

 

I guess this is why parents do research, huh? At least we won't be surprised with the price tag if this particular school remains at the top of DS's list.

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The average 4-year debt of students is a bit more than $22,000.

 

I always find the student debt confusing as even being a meaningful #. Every aid package my kids have received has that as about the ballpark debt level. However, that debt amt is strictly for the student in their name. The real variable that matters to most families is what the real amt is.......the student loan amt plus what parents are expected to contribute. I remember one conversation our dd w/ a college that went something along the lines of we are offering you a substantial scholarship of $x. Your total debt for 4 yrs will only be something like $25000. Dd asked what the financial aid package was to fill the huge gap in $$. The person on the phone was so nonchalant and told her that wasn't a problem that her parents simply needed to take out parent loans. We were not so nonchalant about the number. ;)

 

We aren't willing to accummulate loans for our kids' college, so we have never followed through with any of this, so I don't really know how it really works. They have to find options that we and they can afford w/o our having to take out loans. Anyway, this is typical of what we tend to see from a lot of schools.........

Dependent undergraduate students whose parents have the ability to take out Direct PLUS Loans may not obtain more than $5,500 in Stafford Loans for their first year of education, of which no more than $3,500 can be subsidized; $6,500 for their second year, of which no more than $4,500 can be subsidized; and $7,500 for each additional year of undergraduate schooling, of which no more than $5,500 of this amount can be subsidized. Loans subsidized by the U.S. government offer an interest rate of 4.5 percent compared to a 6.8 percent interest rate for unsubsidized loans for the 2010 to 2011 school year. As of March 2011, the cumulative Stafford Loan limit for undergraduate students comes to $31,300, of which no more than $23,000 can take the form of subsidized loans.

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Your total debt for 4 yrs will only be something like $25000. Dd asked what the financial aid package was to fill the huge gap in $$. The person on the phone was so nonchalant and told her that wasn't a problem that her parents simply needed to take out parent loans.

 

 

This is what I figured the school would do with the gap, place it on the parents, either through cash up front, monthly payments or loans.

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I always find the student debt confusing as even being a meaningful #.

 

:iagree:

 

I think the student debt figure is very misleading. This statement is from the Common Data Set:

 

"Report the average per-undergraduate-borrower cumulative principal borrowed, of those in H4a, through federal loan programs--Federal Perkins, Federal Stafford Subsidized and Unsubsidized. Include both Federal Direct Student Loans and Federal Family Education Loans. These are listed in line H4a.. NOTE: exclude all institutional, state, private alternative loans and exclude parent loans.

 

I "bolded" the last sentence. Obviously, a much more meaningful debt figure would include all of the "bolded" exclusions. I just wish this entire process was more transparent and straight-forward.

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I think the student debt figure is very misleading. This statement is from the Common Data Set:

 

"Report the average per-undergraduate-borrower cumulative principal borrowed, of those in H4a, through federal loan programs--Federal Perkins, Federal Stafford Subsidized and Unsubsidized. Include both Federal Direct Student Loans and Federal Family Education Loans. These are listed in line H4a.. NOTE: exclude all institutional, state, private alternative loans and exclude parent loans.

 

I "bolded" the last sentence. Obviously, a much more meaningful debt figure would include all of the "bolded" exclusions. I just wish this entire process was more transparent and straight-forward.

But herein lies the problem: not all parent loans are Parent PLUS loans. I might take out a home equity loan to fund a kitchen remodel--or a year at Harvard. There is no way of knowing. In fact, when I started the college research process before the recent economic downturn, I read a comment from a college administrator along the lines of "We expect parents to use their homes as cash machines." (Jaw drops...)

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But herein lies the problem: not all parent loans are Parent PLUS loans. I might take out a home equity loan to fund a kitchen remodel--or a year at Harvard. There is no way of knowing. In fact, when I started the college research process before the recent economic downturn, I read a comment from a college administrator along the lines of "We expect parents to use their homes as cash machines." (Jaw drops...)

 

 

I agree. But the number that they could easily publish is the delta between the avg merit aid given and the avg student debt.

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... if this particular school remains at the top of DS's list.

 

 

 

This leads to a reason why it is a good idea to send the FAFSA to multiple schools AND apply to several schools. If a school sees that they are the student's only choice, the school knows it does not have to offer as large of a financial aid package to entice the student -- they already have student "buy-in".

 

At a financial aid session this spring for our homeschool group, we were advised to include several schools, especially big rivals to the student's first choice/only choice school to give the student a bargaining chip:

- to compare the financial aid packages offered to see how the first choice school stacks up to other possibilities

- to be offered a potentially larger scholarship/grant money in the financial aid package of the first choice school

- AND to be able to come back to the first choice school and say, "hey, your rival just offered me this amount of money; what can you do to match or exceed that?"

 

BEST of luck! Warmly, Lori D.

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At a financial aid session this spring for our homeschool group, we were advised to include several schools, especially big rivals to the student's first choice/only choice school to give the student a bargaining chip:

- to compare the financial aid packages offered to see how the first choice school stacks up to other possibilities

- to be offered a potentially larger scholarship/grant money in the financial aid package of the first choice school

- AND to be able to come back to the first choice school and say, "hey, your rival just offered me this amount of money; what can you do to match or exceed that?"

 

 

That is one reason I'm encouraging my son to broaden his horizons beyond the three-ish in-state schools he was considering and include on his list a few campuses at which he is likely to be a more attractive candidate. I'm hoping that, if any of the schools both accepts him and offers him significantly more in merit aid, we maybe able to use that as leverage to squeeze more from other schools.

 

We're one of those families who can't use a home as an ATM, because we don't own one. And we're already drowning in the parent loans we took to get our daughter through her degree a few years ago. The thought of taking on more debt to send a second kid to college -- even if we could get approved to do so -- makes me whimper. On the other hand, I can't really see myself looking my son in the eyes and telling him his dad and I are not willing or able to do as much for him, educationally, as we did for his big sister. So, I've decided to do as much research and preparation as possible for the next 18 months and get myself amped up to do battle on his behalf.

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That is one reason I'm encouraging my son to broaden his horizons beyond the three-ish in-state schools he was considering and include on his list a few campuses at which he is likely to be a more attractive candidate. I'm hoping that, if any of the schools both accepts him and offers him significantly more in merit aid, we maybe able to use that as leverage to squeeze more from other schools.

 

We're one of those families who can't use a home as an ATM, because we don't own one. And we're already drowning in the parent loans we took to get our daughter through her degree a few years ago. The thought of taking on more debt to send a second kid to college -- even if we could get approved to do so -- makes me whimper. On the other hand, I can't really see myself looking my son in the eyes and telling him his dad and I are not willing or able to do as much for him, educationally, as we did for his big sister. So, I've decided to do as much research and preparation as possible for the next 18 months and get myself amped up to do battle on his behalf.

 

 

:grouphug:

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That is one reason I'm encouraging my son to broaden his horizons beyond the three-ish in-state schools he was considering and include on his list a few campuses at which he is likely to be a more attractive candidate. I'm hoping that, if any of the schools both accepts him and offers him significantly more in merit aid, we maybe able to use that as leverage to squeeze more from other schools.

 

We're one of those families who can't use a home as an ATM, because we don't own one. And we're already drowning in the parent loans we took to get our daughter through her degree a few years ago. The thought of taking on more debt to send a second kid to college -- even if we could get approved to do so -- makes me whimper. On the other hand, I can't really see myself looking my son in the eyes and telling him his dad and I are not willing or able to do as much for him, educationally, as we did for his big sister. So, I've decided to do as much research and preparation as possible for the next 18 months and get myself amped up to do battle on his behalf.

 

While you are doing research, you might also look at scholarships from local organizations, your husband's employer, etc. You may already have those on your horizons since your daughter has been through the drill. Some of these smaller scholarships may not cover much, but $500 here and a thousand there can add up.

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This leads to a reason why it is a good idea to send the FAFSA to multiple schools AND apply to several schools. If a school sees that they are the student's only choice, the school knows it does not have to offer as large of a financial aid package to entice the student -- they already have student "buy-in".

 

 

BEST of luck! Warmly, Lori D.

 

 

Thanks. At this stage, I don't know what his plans are. His school choices are all over the board - LACs, public Unies and military academies. I am enjoying reading the mailers and watching which ones are tossed and which are added to the 'think about' pile. As we make campus visits over the next year, I will keep my ears open as to which schools are rivals. Maybe we will be able to find a couple that DS will like well enough and we can get a bidding war going. ;)

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