Financial Aid - home equity consideration

Hi all,
My DD really wants to apply ED at BU, and I am trying to get a handle on how BU currently treats home equity. Does it consider 100% or cap at a certain income level? I found some information only that it capped equity at 2.5x parent income as of 2017, but I am looking for more current info. I called BU and could not get a firm answer. Basically they told me that she can get out of the binding agreement if the financial aid package does not work for us, but I’m not sure we want her to apply ED unless we have a better feel for what we are looking at cost-wise. Thank you for any help you can provide!!

Does their net price calculator ask for home equity?

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Yes, it does. I’ve tried to play with the numbers and it seems to consider 100%

Does the NPC give an affordable estimate when your home value/mortgage is included?

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I’m guessing that is your answer…since the NPCs are supposed to give a decent estimate of potential net costs.

Does the BU net price calculator give you a net cost that is affordable for your family? I think I would believe what it says.

Hoping someone who has a more recent BU student will comment.

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It’s not great that BU wouldn’t give you a firm answer on their policy. On the NPC it looks like at home equity of $500K and above they are hitting it at ~4%, and at a lower % below $500K equity (using an income of $160K).

Do your scenarios with your actual numbers so a similar pattern?

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Personally, I would not encourage a child to apply ED if the university’s own Net Price Calculator shows that it it likely to be unaffordable.

At a minimum, I think that you need to be clear what the financial limit is, and stick with it.

I also would be very reluctant to take on debt to attend BU if you could attend an in-state public university such as one of the Universities of California or a CSU (guessing based on your use name) without taking on any debt.

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Thank you! Yes, the net cost is something we can take on with some debt. However, we have limits on what we feel we can/should take on as my husband is retired. We also bought our house 15 years ago and it needs a lot of work. The online Zillow value for homes in California are so inflated right now. I’ve thought about getting it appraised…

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Thank you! I played with the NPC and it seems to be hitting it at 5% for us even at $300k equity. I guess I am just hoping a current BU parent might come along with their experience on this issue. But for now, we will just assume the NPC is exactly what we are dealing with and make our decision based on that. Thanks again.

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Thank you! Yes, we are trying to stay clear on our financial limits, but at the same time we are willing to take on some debt to allow our daughter to attend a school back east which is a dream of hers. That said, you are so right. Good schools here in CA too! Thanks again for your reply!

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I am the proud parent of a Boston University graduate. I also live on the east coast. There are MANY colleges on the east coast. What makes BU so attractive to your daughter? Perhaps there are other (less costly) options for her to consider.

Adding…there are also a bunch of colleges in and near Boston that could have a more favorable price point.

Why BU?

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How much is “some”? Is it just the student Direct Loan? Or are you parents planning to also take out loans to fund college?

Just make sure that this college is really affordable for your family. And not just for the short term, but also for the repayment period of any loans.

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Talk to an aid officer there.

They should be able to provide a clear answer to you.

If they can’t, don’t apply ED.

In the end, you are a consumer and you deserve transparency for your hard earned dollars yiu will spend. And you want to ensure you can afford the school. So ED is a risk if you can’t get a near assured price.

Lots of great colleges out there. It’s not like your student can only be happy at one. If not BU it will be another, whether a most similar like NYU or GW or somewhat urban like a Charleston, PITT, etc.

Good luck.

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@tsbna44 actually the BU net price calculator reportedly is accurate.

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Not saying it isn’t. My comment to OP was based on his call and they could not give an answer.

Either OP did not talk to a Financial Aid expert or they are not worthy of his investment.

Worst thing anyone can do is stress themselves out financially.

I’m sure many who have stretched to fund their kids educations, on a day like today, where the market has tanked, are even more stressed.

So y gamble your future mental health in addition to your bank account?

And if u sent your kid to Columbia and found out the epitome of truth and morality lied for years…well how do you feel about that investment now? Was it worth the financial pain ? Well no doubt a class action lawyer will help alleviate some of that pain :slight_smile:

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“Retired” and “debt” are two words that I do not like to see used together.

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This seems harsh, although I agree BU should make clear their home equity policy. We know BU meets full need, one of the only 140 or so schools that do that.

We don’t really know enough about OP’s financial situation to judge how they will finance college, pay off loans, or if that would necessarily lead to stress. For many people paying for their kids’ college is an investment they are proud to make, and some will sacrifice to make that happen. Maybe they cut back and pay for college and/or make loan payments out of cash flow…lots of people are able to do that. Maybe they will work longer than they might have had to…lots of people do that too. Their lives, their money, their choice.

Columbia is the same school it was before some institutional reporting peeps and some administrators incorrectly reported certain numbers, maybe even purposefully, maybe with an intent to mislead. But, I don’t see how any student has been harmed. At all.

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On Columbia, I agree. However we know many ‘choose’ based on a ranking so the perceived value may be in question. If you are T10 only etc. but I was being facetious. It’s like Bill Belichik. Same coach even though he’s losing more. On the other hand, many thought Columbia was legit top shelf (based on US News) when in reality they never were. Mind you, I don’t put much credence in rank…I can’t as my kids chose the schools they liked, not the ranked schools they got into (although selfishly I wanted them to ) :). I’m a walking contradiction.

On BU - I was not being harsh toward OP. I was simply saying perhaps they spoke to an operator or someone who doesn’t understand the BU aid concepts. If they can’t reach the right person or BU is purposely vague, that given the risks to them financially, they would be smarter to go non binding so THEY can make the attendance decision rather than BU. Admissions officers are sales people - lest not forget.

I’m in Maine right now. Every place has various lobster dishes and they are all priced ‘at market’. In this case the waiters can tell you what that price is. But if BU can’t, then order chicken…ie still eat there but eat something different.

Crazy analogy - but I’m trying.

Not intending to be harsh at OP. I’m saying - BU shoot him straight or lose that assured customer. If they (BU) can’t get this right, how can OP have confidence in them later ?? We are not talking $100 or $1k or even $100k dollars. There’s too much at stake to ‘trust’ strangers.

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To the OP…

I just want to say…some people aren’t looking for a lower price tag for college costs. They have a range of a budget, but for some it’s not even a fixed number.

We are amongst that group. We funded expensive private universities for both of our kids (BU was one…he did get a decent scholarship as a music major but it was still more costly than many of his other acceptances). We funded a private university for our daughter at more than three times the cost of her second choice…and it was a very good decision for her.

I think you need to consider your debt amount. Think about how much you can reasonably pay each month for college and start putting it in a separate bank account this month. See if that is sustainable. If it is, fine. If not, please rethink your finances.

ETA….please remember…the folks answering the phones are not higher level financial aid officers or adcoms. And really, with the accuracy of the BU net price calculator, I’d go with that even as a gross estimate.

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Not to derail the conversation but why exactly is it a dream of hers? There is no right or wrong answer of course but at the end of the day, letting a 18 year old make a decision on what is likely going to put you in debt requires some vetting. She might give you a very good reason or three. Or, she might just have some ideas in her head that are not well formed or thought out.
Please remember that MOST undergrads change their majors. So, the academic reason to attend a school is often lost as the major changes. The best gift your child can have in to not worry about her parents’ welfare after they retire.

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