<p>I know that aid is based on gross household income…but what happens if you’re in debt? My household definitely makes enough money (my mom ranges anywhere from 80-100k a year, I know)…but she has a lot of debt. This income she has has only been around for 3 years or so from when she got a big promotion. Thing is, my grandmother passed away maybe 8 years ago, so my mom got stuck with not only her own debts (and the ones she created when she needed to get by when we only had maybe 35k annually in the house), but my late grandmother’s. To this day my mother struggles financially.</p>
<p>So now that it’s time for me to apply to college…does any of this matter? Technically my mother earns the money, but she never gets to even see most of that money. Would that be taken into consideration with ANYBODY when it comes to receiving aid?</p>
<p>It’s likely the debts won’t be considered when calculating your financial aid, however once you have an award you can try to get a professional review where they might take some of that debt into consideration. It really is up to the school. It’s not likely that even if they do give you some adjustment it will really be a dramatic difference.</p>
<p>Sometimes medical debt will be accomodated, but not consumer debt.</p>
<p>How is it that your mother is paying debts of your deceased grandmother?</p>
<p>Something about the paying of your grandmother’s debts is … well, unusual. Normally you wouldn’t see that, the debts would have been cancelled upon her death and the settling of her estate.</p>
<p>There is a good lesson in this for students who take on huge educational debt though. How a person can earn a decent income and still be struggling when trying to pay down enormous debt.</p>
<p>Paying off your grandmother’s debt is very unusual - unless mom co-signed educational loans for grandma (unlikely) or continues to pay debt connected to property left to her by grandma’s estate (more likely). The second scenario could have other FA complications. You and your mom need to gain a good understanding of how FA is calculated and consider the options to increase cash flow - or get accepted to a HYP school that thinks 100K is very needy.</p>
<p>See if you can get an appointment with someone in the financial aid office at a college near you so that you and your mom can sit down with a real human being who is expert in these matters. Your situation is particularly messy and outside the norm. You need a professional to take a look at it.</p>
<p>You and your mom do need to sit with someone that can go over these issues. Sometimes parents are not eager to share details of financial situations with their kids. Though we are relatively open about our finances in our family, there are some things that we do keep private. There are concerns that we feel are not our kids’ problems. We don’t feel we owe them an explanation for everything. Basically we just tell them about what we can afford, so that they do look for colleges within those guidelines.</p>