Hi everyone, my family lives in the US but for legal purposes I am an international applicant. I recently received my acceptance from an lac, and am talking with the financial aid office about my current family situation. We currently have a few rental properties with home equity loans on them, therefore they are not profitable and cannot contribute to my education. The FA office asked me to verify these loans by showing them the mortgage documents. My mother does not want to do this as she believes these files are confidential and the CSS should have been enough. My question is: do they have a right to request these kind of documents? If so, and since my mother refuses to send them, how can I relay this?
If you want the financial aid, you provide what they want. YOU are asking for an exception, for them not to consider the assets you own.
I’ll bet they don’t really want the entire mortgage documents, but perhaps a bank statement showing the value of the property and the amount still owed.
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The FA office asked me to verify these loans by showing them the mortgage documents. My mother does not want to do this as she believes these files are confidential and the CSS should have been enough. My question is: do they have a right to request these kind of documents? If so, and since my mother refuses to send them, how can I relay this?
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This is ridiculous. These loans aren’t “confidential” any more than anything else your mom provided. This isn’t especially sensitive private info. If it were so sensitive and “confidential” then your mom wouldn’t have mentioned them on CSS. These loans aren’t any more “confidential” than income, assets, or anything else you’re reporting. If the school asked for verification of income, would your mom say that is “confidential”?
You are asking the school for MONEY…they have a right to see if what your family is CLAIMING on CSS is true…or NOT. The fact that your mom is refusing to provide proof that the claim is true will just lead the school into believing that your family has not been honest with them. Why would the school think otherwise??
The school may also be suspicious about the existence of these “home equity” loans for the following reasons:
- they aren’t on a primary residence (as someone who owns rentals myself, I know how banks are extremely leery about “equity loans” on rental properties.)
- your parents are int’ls…banks are even more leery about loans to int’ls.
Your mom has a choice…provide the well-documented info that these loans exist…or pay for your college. (And the school isn’t going to accept some “created loan papers” that suggest that a friend or relative loaned your family money and now those properties are collateral.)
The school wants to see bank records of how much each “loan” is still owed.
(I doubt these loans exist, and likely the school does, too.)
I just figured schools would do a credit report on students and parents to verify items.
Nope. If the school is asking for specific documents…like proof your home equity loans, or anything else, for that matter, you MUST send them what they are requesting. Send them exactly what they are requesting.
Or you will not get a nickel of financial aid.
We get a monthly statement on our home equity loan. It tells the amount paid the previous month towards interest and principal, and the balance. Your parents can get that too…and provide it to the college. They will need to get this from the bank.
Or you won’t get any aid…at all.
From the school’s point-of-view, your family could sell property that’s not your primary residence and use the money they were using to pay the mortgages to pay for college instead. Why should the college give you money so your parents can use theirs to buy rental properties?
And FYI…when verifying your information…schools can ask for just about anything that they need to support what you put on your financial aid application form. My one kid was verified four times…And he got no need based aid. We had to send mortgage info, tax returns for two years, recent pay stubs…a months worth for both parents, and our bank statements for two months. And we got NO need based aid except a Direct Loan.
We sent them everything they asked for…everything!
Of course they have the right.
Tell them that your mother refuses to send them. They will say thank-you-very-much and give the financial aid dollars to another student who has provided all the information requested.
Also… your mother should know that in most (many?) states, a mortgage is usually a matter of public record. If the mortgage holder (the lender) wants to protect their interest in the property, the mortgage documents must be filed at the registry of deeds or similar government recording office, where they will be available to the public (and increasingly available online). So no… not confidential.
MiddKid is absolutely correct. In fact, when we have purchased properties, it was very easy for us to find out the previous sales cost, and how much of a mortgage the buyer took out…and from where. Matter of public record.
Your mom is being very penny wise and pound foolish…unless there is money in the bank to pay your full cost of attendance.
Your mother, if she is from another country, may not fully understand the financial aid system here, or understand that most colleges (including the one you applied to) are not publicly funded. You can explain to her that only a very small portion of aid comes from the government (and, as a non-citizen, you aren’t eligible for that portion). The rest comes from the college itself, from its own money, with no help from the government. So, each college has its own money and makes its own decision how to spend that money - with no government involvement at all.
Explain that the CSS Profile does not go to a central processing office to be analyzed - nobody at the Profile office even looks at them. They just get copied there and forwarded along to each of the schools you applied to . . . and each school analyzes the Profile on its own. (There’s no government “system” for this, and no government oversight whatsoever. It’s completely private.)
And the colleges that decide to give you money dip into their own pocket to do so. So it’s a lot like walking up to a total stranger on the street and asking for money. If you are lucky enough that they say “yes,” are you going to complain if they ask for proof that you’re as poor as you say you are?
OP, are you a permanent resident…green card holder?
The school is not the bad guy here. The school is trying to help you, but they also must be responsible in how they deal out limited financial aid by making sure that it goes to people who really need it.
Your mother is the one who needs to change her attitude and behavior, not the financial aid officer. Remind her that the schools are not out to take her assets or to harm her. Give her some empathy in knowing that it is very scary in some countries to share personal information about assets (that may be the situation in your home country?) but that the information she provides will only be seen by the financial aid person at the school. Are you close enough that the two of you can go talk with that person?
Multiple properties with multiple home equity loans in a foreign country or here in the USA? Isn’t it all on your mums tax returns?
Alfonsia…unless I’m missing something on my tax return…the actual equity value in my home, or any other properties is not there.
Thank you all for the responses! I am not a permanent resident. My mother is on a work visa. Our properties are in the US but the loans are not listed in my mother’s tax return.
I understand I am asking for money from the college and I should be willing to provide whatever the college desires. My family is not trying the scam the college, we do have significant loans. The phrasing of my original question was misleading–as someone who does not know much about the financial aid process, I was trying to see if financial verification is commonplace so I could convince my mom that she does not have to worry about sharing financial information with the college. Thank you for the advice Kkmama, I’m going to try my best to convince my mom.
Yes…financial aid verification is pretty commonplace. Some schools verify almost everyone. Others select randomly. Others verify information that they feel they need to know to make a prudent decision.
Good luck to you…just give the schools what they are asking for…but do it ASAP!
@Middkid86, I can find records of these loans online. However, I can’t go behind my mother and send them without her consent.
Isn’t income on investment properties listed on a tax return? Mum must have an accountant. Having multiple properties with multiple equity loans is quite a feat for a non perm resident, non us citizen. Moneyed non residents, not so much.
Yes, income is listed on rental properties. But that has nothing to do with the equity held in those properties.