Check to see if the financial aid office is doing in person appointments. Because of Covid, they might not be.
I don’t think they are doing in-person appointments due to COVID-19. I haven’t even been able to get a phone appointment.
FAFSA is the basic form for financial aid applications. It determines your eligibility for federal PELL grant, subsidized student loans, and federal work study jobs. You must fill out FAFSA for your parents to be allowed to take out PLUS(parent loans. Some states also have financial aid programs that use FAFSA as well. There are only a few schools that guarantee to meet full demonstrated need as determined by the FAFSA EFC.
The FAFSA EFC, uses only custodial parent and spouse financial info. It does not ask about primary home market value. Business income is counted as reported on tax forms. For school year 2020, 2018 federal tax forms are used for income and assets as of the date the form is transmitted.
Schools that guarantee to meet full demonstrated need almost always ask for more information and use a different methodology. PROFILE is the form usually used. If your family owns a primary residence, has a family business, has “unusual” assets, owns property, the valuations of all of these entities, as well as possible other things are added to the equation to come up with an institutional EFC which usually is larger than the FAFSA EFC. If there are businesses, properties , etc that need to be evaluated as to value, schools have their own methodologies. If you and your parents do not agree with the institutional EFC, you should find out what the sticking points are and argue your case. It is possible mistakes were made on your part as well as the school’s. There might be misunderstandings as well. You and your parents should understand how the school assessed your need, evaluated your family business and holdings. Any disagreements should be discussed.
It is possible that the school did misunderstand the value of your family assets and earnings. However, bear in mind that just because you and your parents do not agree with the valuations, doesn’t mean the school will change their methodology. If it’s a matter of disagreement, it’s their game, their formulas , their valuations and their money so they can do as they please in terms of defining all of these terms. I’ve known many families who disagree with the market values placed on the assets or how the income is viewed. It can be hair raising when the depreciation and expenses for a business are added back to income. That’s often how it is done. But you and family absolutely should understand how the school views your family situation.
I know this is frustrating. Financial aid terms need better explanations. The FAFSA EFC is misnamed. It’s not really an estimated family contribution; it’s a Pell Grant eligibility index and that’s all it’s used for. If the number it spits out is under 6000, students may be eligible for Pell. If it’s higher then they’re ineligible. That number is unrelated to the EFC that’s generated by college financial aid offices.
Colleges that meet need define need based on their own calculations. It has nothing to do with the FAFSA EFC or with what families feel they can pay. You aren’t a low income family with no assets. Your parents own a primary home plus additional rental properties. Multiple real estate holdings are considered assets. Your reported income is $10,000, but that’s only after deductions are taken out. I wouldn’t expect a financial aid office to treat your family like one who owns no assets and whose total income is $10,000.
It’s unfortunate that these things are so complicated and I hope it works out, but I think you need to be prepared for the possibility that any additional aid they offer may not be enough.
As I said above, you and your family should understand how the school came to it’s numbers. I have known people who have disputed business and property valuations and were able to present a clear case as to why the school’s methodology was flawed in evaluating their situation. You are highly unlikely to win if your case hinges on trying to get any school to change what is standard form, but situations could be misinterpreted, mistaken or be something that simply does not fit any parameters that school has.
But, yes, it can really hurt when a family is cash poor for financial aid, yet they are not eligible for money. I knew a family who owned a portion of family property that was valued high enough that it knocked them out of the running for financial aid. Inherited, shared family land , and they had the privilege of living in that property , but selling it was at best very messy and maybe not even legally possible. But none of the PROFILE schools took that into consideration. It was an asset and was counted as such.
A situation I see a lot is parents not willfully to pay what college’s formulas deem their EFC. It comes up so very much with divorced families, especially when one of the parents has started a second family. FAFSA does not ask for noncustodial parent financials. PROFILE often does. That a parent won’t contribute for college is not a factor to the colleges.
I am sympathetic to the “portion of family property” problem-- to a point. Yes, it stinks to be the kid. But assets can be sold, borrowed against. Families don’t want to dilute ownership of a plot of land with a home on it which is owned by three siblings, and don’t want to have their views encroached by selling off a chunk to a developer. Quite legitimate. But you are asking a college to consider you-- with land, which has value, or a closely held business, which has value, or real estate, which has both value and current cash flow attached to it- in the same bucket as someone with zero assets. And those folks are out there, and all of you are competing for the same chunk of dough.
OP- hugs. I hope you can have a good meeting to clear up any misunderstanding or miscalculation on the part of the college.
@BelknapPoint does UVA use primary home equity in their need based aid calculation.
@Bigrob what is the equity in your primary residence?
I don’t know if there is any equity in the primary residence either, maybe a small amount but due to our financial hardship there are many major maintenance factors on the home that we can’t afford to fix that would dramatically hurt the potential resale value if we were told we had to sell the house to pay for college.
As I’ve mentioned before, the other properties cannot be given away as the mortgages far exceed the value. I sure wish we could give them away!
If there wasn’t any equity in your primary residence your parents wouldn’t have been approved for a home equity loan. Have you had any luck reaching the financial aid office this week? They should walk your family through their methodology.
I have not. I called and waited 30 minutes and made it to number 34 in queue.
Stay on the line next time.
I would call and stay on the phone until you get someone. What are your parents saying about this? Have they tried calling?
So…any update??
my 2c is that while your fafsa may imply 0 EFC, each school has its own calculation. I suspect that asset is an issue but I believe that would not show up on fafsa. Sometimes, when you appeal, you have to show your monthly income, and monthly expenses, down to auto insurance costs, and utility bills, etc. On that appeals form, it will ask about the any loan (HELOC). Sometimes the FA officers also suspect the worst and it might be a good idea to ask directly. Good luck.
@nomorecoll96 Please tell us which colleges ask for your monthly expenses to be itemized as part of a financial aid appeal.
@BelknapPoint have you ever heard of this?
No, but with thousands of different colleges in the U.S., it’s not out of the realm of possibility. I do take exception with the idea that “while your fafsa may imply 0 EFC, each school has its own calculation.” As far as I know, schools that use FAFSA only to determine need-based aid (and that means most schools) do not calculate a separate EFC; they use the EFC that FAFSA has calculated for them.
I would also make sure that 401k/IRA assets are entered properly on the FA forms. They don’t count in the same way as funds in a bank/personal account, and that’s an error that pops up often.
I had to detail this when I appealed after my job ended. They wanted to know what my bills were and how I was paying them. I don’t remember if it was broken down monthly or for the semester. One school just asked me and I sent an email. Other school had a chart on the appeal form and you filled in income and expenses. It also had spots for unusual expenses like medical bills.
And remember…a $0 EFC on the FAFSA is not a guarantee you will receive full funding from the college. That is totally dependent on school policies.
The most important things you need to do when completing financial aid application forms…be accurate, and be honest.
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@nomorecoll96 Please tell us which colleges ask for your monthly expenses to be itemized as part of a financial aid appeal.
off the top of my head, northwestern and princeton.