Is this correct? Financial aid questions.

xiggi
Thu, 24 Apr 2008 19:26:47 +0000

Increasing the amount of debt on your home should increase your deductible expenses (interest.) Interest paid to a credit card or car loan comany is not deductible. The impact of increasing your debt to equity ratio in your house will probably be small, but still helpful.

Avoid any transfer of funds that will show an increase in assets in the student name. If grandparents are willing to help, you may find it more beneficial for them to transfer to you within the gift tax limits and help pay your EFC. You may also consider borrowing the money from the grandparents as opposed to receive it. Later on, this could be reversed via gifts.

I do not think that the assets of grandparents need to be disclosed, but any funds they disburse directly to your children will have an impact.

Asking the right questions before it’s too late is smart.