That is true…only $3500 of the Direct Loan can be subsidized. The other $2000 would be unsubsized.
You need to have financial need to get a subsidized loan. It sounds like you don’t have financial need at all due to your farm ownership. This happens to many owners of these kinds of properties.
Bottom line is…you are a part owner, and need based aid is not going to be given to you to support owning this.
I know…it doesn’t seem “fair” but there it is.
The interest on the Direct Loan total could be paid off by you or your kid (if your kid has a job) annually, thus sort of subsidizing it yourselves.
If this is a special circumstances consideration…that would need to be dealt with at each college. But it doesn’t sound like a one time event.
It’s really too bad @curmudgeon isn’t still posting here. He understood this issue well, and his kid looked for schools with excellent merit aid…no income or assets to be considered.