FFinancing a College inancing a College Education Education

2010-2011

Presented byCindy Kohlman

University of BuffaloAnd

Ann HigginsHESC

AgendaAgenda

FAFSA application procedures

Definition and calculation of financial need

Description of major federal financial aid programs

New York State TAP application process

Reviewing award letters from colleges

Financial aid eligibility criteria

General Student General Student Eligibility CriteriaEligibility Criteria

• Pursuing degree or certificatePursuing degree or certificate

• Courses must be applicable to degree/certificateCourses must be applicable to degree/certificate

• U.S. citizen or eligible non-citizenU.S. citizen or eligible non-citizen

• Males MUST register with Selective ServiceMales MUST register with Selective Service

• Valid Social Security NumberValid Social Security Number

• Previous student loans must not be defaultedPrevious student loans must not be defaulted

• Must not owe overpayment of Federal grant or loanMust not owe overpayment of Federal grant or loan

• Maintain satisfactory academic progress standards (as defined byMaintain satisfactory academic progress standards (as defined by school)school)

**Drug related convictions can cause loss of eligibilityDrug related convictions can cause loss of eligibility

Independent Student Independent Student DefinitionDefinition

• At least 24 years old by December 31st of award year covered by FAFSAAt least 24 years old by December 31st of award year covered by FAFSA

• Graduate or professional studentGraduate or professional student

• MarriedMarried

• Have legal dependents other than a spouseHave legal dependents other than a spouse

• Orphan or ward of the courtOrphan or ward of the court

• Veteran of U. S. Armed ForcesVeteran of U. S. Armed Forces

• Currently serving on active duty in U.S. Armed Forces for purposes other Currently serving on active duty in U.S. Armed Forces for purposes other than training.than training.

• New for 2009-2010 Homeless, unaccompanied youth, emancipated minor, New for 2009-2010 Homeless, unaccompanied youth, emancipated minor, have legal guardian.have legal guardian.

• Determined to be “independent” by administratorDetermined to be “independent” by administrator

General Application General Application ProcessProcess

Submit Free Application for Federal Student Aid Submit Free Application for Federal Student Aid (FAFSA) prior to school’s deadline(FAFSA) prior to school’s deadline

Submit NYS TAP applicationSubmit NYS TAP application

Check with each school to determine:Check with each school to determine: Required application materials & deadlines Required application materials & deadlines

(Verification documents, CSS Profile, or other (Verification documents, CSS Profile, or other institutional forms)institutional forms)

Contact school Financial Aid Office for their Contact school Financial Aid Office for their specific application policies & procedures. specific application policies & procedures. College websites are a good resource for this College websites are a good resource for this information.information.

FAFSA: Free Application FAFSA: Free Application for Federal Student Aidfor Federal Student Aid

Collects family’s personal & financial Collects family’s personal & financial information used to calculate student’s EFC information used to calculate student’s EFC

May file FAFSA in one of two ways:May file FAFSA in one of two ways: Electronically via FAFSA on the WebElectronically via FAFSA on the Web Paper FAFSAPaper FAFSA

Signatures of student and at least one parent Signatures of student and at least one parent are requiredare required Electronic FAFSA uses PIN as signatureElectronic FAFSA uses PIN as signature Now can apply for PIN “real time” and Now can apply for PIN “real time” and

choose own PIN.choose own PIN.

PIN RegistrationPIN Registrationwww.pin.ed.govwww.pin.ed.gov

Get a Get a PIN PIN NOW -NOW -each each studenstudent & at t & at least least one one parent!parent!

FAFSA on the WebFAFSA on the Webwww.fafsa.ed.govwww.fafsa.ed.gov

Can be filed as early as January 1Can be filed as early as January 1stst of award of award yearyear

AVOID ERRORS!AVOID ERRORS!Frequent FAFSA Errors:Frequent FAFSA Errors:

• Parent & student Social Security NumbersParent & student Social Security Numbers• Divorced/remarried parental informationDivorced/remarried parental information• Income earned by parents/stepparentsIncome earned by parents/stepparents• U.S. income taxes paid U.S. income taxes paid • Household sizeHousehold size• Number of household members in collegeNumber of household members in college• Real estate & investment net worthReal estate & investment net worth

– The value of your primary residence is not included.The value of your primary residence is not included.– The value of retirement accounts (i.e., IRA, 401(k), The value of retirement accounts (i.e., IRA, 401(k),

403(b), pension plan) and life insurance policies are not 403(b), pension plan) and life insurance policies are not includedincluded

– Investments include stocks, bonds, certificates of Investments include stocks, bonds, certificates of deposits, mutual funds, trust fundsdeposits, mutual funds, trust funds

Apply for New York Apply for New York State Aid State Aid

New York StateNew York StateTuition Assistance Program Tuition Assistance Program (TAP) (TAP) www.tapweb.orgwww.tapweb.org

New York State TAPNew York State TAPwww.hesc.org

New York residents attending New York Schools New York residents attending New York Schools onlyonly

Must submit FAFSA in order for TAP application to Must submit FAFSA in order for TAP application to be availablebe available

First school listed on FAFSA will receive TAP award First school listed on FAFSA will receive TAP award informationinformation

Awards based on New York State Net Taxable Awards based on New York State Net Taxable Income from prior year & school’s tuitionIncome from prior year & school’s tuition

Net Taxable Income limits:Net Taxable Income limits: $80,000 for dependent student$80,000 for dependent student $10,000 for independent student without $10,000 for independent student without

childrenchildren

Maximum award is $5,000 for dependent studentMaximum award is $5,000 for dependent student

More New York State AidMore New York State Aid Part-time TAPPart-time TAP

For students enrolled in less than twelve degree For students enrolled in less than twelve degree applicable credits ANDapplicable credits AND

Completed twelve credits per semester in two Completed twelve credits per semester in two preceding, consecutive semesters. Must have preceding, consecutive semesters. Must have been a first time, freshman in 2006-2007 or been a first time, freshman in 2006-2007 or afterafter

Uses same online application as full-time TAPUses same online application as full-time TAP

APTS (Aid for Part-Time Students)APTS (Aid for Part-Time Students) Separate, paper application available in Separate, paper application available in

Financial Aid Office and processed by college, Financial Aid Office and processed by college, not NYSnot NYS

Awards vary, not to exceed cost of tuitionAwards vary, not to exceed cost of tuition Must be enrolled in less than twelve degree Must be enrolled in less than twelve degree

applicable creditsapplicable credits Available for students who have attended Available for students who have attended

college prior to 2006-2007 college prior to 2006-2007

What’s Next NowWhat’s Next Nowthat I’ve Applied?that I’ve Applied?Financial Aid Office:Financial Aid Office:

1.1. Receives FAFSA resultsReceives FAFSA results

2.2. Requests additional information, Requests additional information, if necessary (Verification)if necessary (Verification)

3.3. If additional information is not If additional information is not required, notifies student of required, notifies student of financial aid eligibility by mail or financial aid eligibility by mail or email.email.

The Verification ProcessThe Verification Process FAFSA applications are randomly selected by FAFSA applications are randomly selected by

the U.S. Dept. of Education to be “verified”the U.S. Dept. of Education to be “verified”

Information on the FAFSA must be compared Information on the FAFSA must be compared with the information you provide (i.e. tax with the information you provide (i.e. tax forms) and corrections made as necessaryforms) and corrections made as necessary

Verification process is completed by Verification process is completed by individual financial aid officesindividual financial aid offices

If you are selected, aid cannot be processed If you are selected, aid cannot be processed for the student until his/her application has for the student until his/her application has been verifiedbeen verified

Cost of AttendanceCost of Attendance(COA)(COA)

Tuition & feesTuition & fees

Room & boardRoom & board

Books, supplies, Books, supplies, transportation, & transportation, & miscellaneous miscellaneous personal expenses, personal expenses, including including documented costs documented costs for personal for personal computercomputer

Loan fees, study Loan fees, study abroad costs, abroad costs, dependent care dependent care expensesexpenses

Cost of Cost of AttendanceAttendance

MinusMinus

Expected Expected Family Family

ContributionContributionEqualsEquals

NEEDNEED

Cost of Attendance (COA)Cost of Attendance (COA)DIRECT COADIRECT COA – – out of out of

pocket expense paid pocket expense paid directly to institution directly to institution such as:such as:

– TuitionTuition– FeesFees– Room & Board (at Room & Board (at

4 year institutions)4 year institutions)– Personal Computer Personal Computer

(if required by (if required by school)school)

INDIRECT COAINDIRECT COA – – other other costs that may be costs that may be incurred while incurred while attending school such attending school such as:as:

– BooksBooks– Personal Exp.Personal Exp.– Room & BoardRoom & Board– Loan FeesLoan Fees– TransportationTransportation

Expected Family Expected Family Contribution (EFC)Contribution (EFC) Federal formula takes into account:Federal formula takes into account:

Parent and student income & assetsParent and student income & assets Size of familySize of family Number of children in collegeNumber of children in college

Schools use EFC to determine:Schools use EFC to determine: Eligibility for Pell and SEOG grantsEligibility for Pell and SEOG grants Subsidized vs. Unsubsidized loansSubsidized vs. Unsubsidized loans

Federal Pell & SEOGFederal Pell & SEOGGrants (Need-Based Aid)Grants (Need-Based Aid)

• Awarded to eligible undergraduates pursuing first Awarded to eligible undergraduates pursuing first Bachelor’s degreeBachelor’s degree

• Actual Pell award amount based on COA, EFC, & Actual Pell award amount based on COA, EFC, & enrollment statusenrollment status

• SEOG awarded first to students with exceptional SEOG awarded first to students with exceptional financial needfinancial need

• Maximum Awards for 2010-2011:Maximum Awards for 2010-2011:– Pell $5,550 Pell $5,550 – SEOG $4,000SEOG $4,000

• Awards are prorated based on number of degree Awards are prorated based on number of degree applicable creditsapplicable credits

Academic Competitiveness Academic Competitiveness Grant (ACG)Grant (ACG)

• Student must have completed Student must have completed rigorous rigorous high school high school program after January 1, 2006program after January 1, 2006

• Must have minimum GPA of 3.0 at end of year 1 in Must have minimum GPA of 3.0 at end of year 1 in order to qualify for ACG in year 2order to qualify for ACG in year 2

• Maximum award of $750 in year 1 and $1,300 in Maximum award of $750 in year 1 and $1,300 in year 2year 2

• Student must be Pell eligibleStudent must be Pell eligible• Full-time or half-time studentFull-time or half-time student• Accepted in a certificate, two or four year degree Accepted in a certificate, two or four year degree

program program • U.S. Citizen or eligible non-citizenU.S. Citizen or eligible non-citizen• Program offering will end with the 2010-2011 yearProgram offering will end with the 2010-2011 year

National National SScience and cience and MMathematics athematics AAccess to ccess to RRetain etain TTalent (SMART) Grantalent (SMART) Grant Third and fourth year undergraduate studentsThird and fourth year undergraduate students

Federal Pell Grant recipientFederal Pell Grant recipient

U.S. citizen or eligible non-citizenU.S. citizen or eligible non-citizen

Full time or part timeFull time or part time

Eligible major/3.0 GPAEligible major/3.0 GPA

Award amount: $4,000 for third and fourth Award amount: $4,000 for third and fourth year of studyyear of study Program offering ends with the 2010-2011 Program offering ends with the 2010-2011

yearyear

TTeacher eacher EEducation ducation AAssistance for ssistance for CCollege ollege and and HHigher Education (TEACH) Grant igher Education (TEACH) Grant

ProgramProgram• TEACH Grant recipients must agree to serve as a TEACH Grant recipients must agree to serve as a

full-time teacher in a high-need field in a public or private elementary full-time teacher in a high-need field in a public or private elementary or secondary school that serves low-income students for at least four or secondary school that serves low-income students for at least four academic years within eight years of completing the degree.academic years within eight years of completing the degree.

• Recipients that fail to complete this service obligation will have their Recipients that fail to complete this service obligation will have their TEACH Grant converted to a Federal Direct Unsubsidized Stafford Loan TEACH Grant converted to a Federal Direct Unsubsidized Stafford Loan with interest since acceptance of award added. with interest since acceptance of award added.

• Meet certain academic achievement requirements (generally, scoring Meet certain academic achievement requirements (generally, scoring above the 75th percentile on a college admissions test or maintaining a above the 75th percentile on a college admissions test or maintaining a cumulative GPA of at least 3.25). cumulative GPA of at least 3.25).

• High Need Fields: Bilingual Education, English Language Acquisition, High Need Fields: Bilingual Education, English Language Acquisition, Foreign Language, Mathematics, Reading Specialist, Science, Special Foreign Language, Mathematics, Reading Specialist, Science, Special Education. Education.

• $4,000 per year, $16,000 for undergraduates total, $8,000 total for $4,000 per year, $16,000 for undergraduates total, $8,000 total for graduate studentsgraduate students

Federal Work-Study Federal Work-Study (FWS)(FWS) Undergraduate and graduate students are Undergraduate and graduate students are

eligibleeligible

Employment may be on or off campusEmployment may be on or off campus

Schools must use portion of FWS funds for Schools must use portion of FWS funds for community service employment activitiescommunity service employment activities

Student works to earn pay checkStudent works to earn pay check

Pay rate is determined by schoolPay rate is determined by school

Federal Perkins LoanFederal Perkins Loan Eligible studentsEligible students

Undergraduate and graduate studentsUndergraduate and graduate students Priority to students who show “exceptional need,” Priority to students who show “exceptional need,”

as defined by schoolas defined by school

Annual loan amount variesAnnual loan amount varies Maximum amounts of $4,000 or $6,000 for Maximum amounts of $4,000 or $6,000 for

undergraduate and graduate students respectivelyundergraduate and graduate students respectively

Interest rate: 5%Interest rate: 5%

9 month repayment grace period.9 month repayment grace period.

Repayment period may be up to 10 yearsRepayment period may be up to 10 years

Federal Stafford LoansFederal Stafford LoansDIRECT LENDINGDIRECT LENDING Federal Direct Student Loan ProgramFederal Direct Student Loan Program

Funds provided directly by federal Funds provided directly by federal governmentgovernment

FeesFees: Up to 1% origination fee: Up to 1% origination fee

Federal Stafford LoansFederal Stafford LoansSubsidizedSubsidized

• Must Must demonstrate demonstrate “need”“need”

• Interest free to Interest free to student while in student while in school (and school (and enrolled at least 6 enrolled at least 6 credits)credits)

UnsubsidizedUnsubsidized

• Need is not considereNeed is not considered

• Interest accruesInterest accrues– Student can choose to Student can choose to

pay or capitalize while pay or capitalize while in schoolin school

Federal Stafford Loan SpecificsFederal Stafford Loan Specifics• Must be registered for at least 6 degree-applicable credits per Must be registered for at least 6 degree-applicable credits per

semestersemester• Fixed 4.5%interest rateFixed 4.5%interest rate• 6 Month Grace Period 6 Month Grace Period • RepaymentRepayment

– Up to 30 yearsUp to 30 years– 4 options4 options

• Freshman loan limit is $3,500Freshman loan limit is $3,500• Sophomore loan limit is $4,500Sophomore loan limit is $4,500• Junior and Senior loan limit is $5,500 each yearJunior and Senior loan limit is $5,500 each year• School determines criteria for freshman/sophomore/junior/senior School determines criteria for freshman/sophomore/junior/senior

statusstatus• MPN and Entrance Counseling must be completed prior to MPN and Entrance Counseling must be completed prior to

borrowing Stafford Loansborrowing Stafford Loans

PLUS LOANPLUS LOAN• Federal parent loan program for parents of dependent Federal parent loan program for parents of dependent

undergraduate students enrolled in at least 6 degree applicable undergraduate students enrolled in at least 6 degree applicable credits per semestercredits per semester

• Annual loan limit: COA minus other aidAnnual loan limit: COA minus other aid

• Fixed interest rateFixed interest rate

• Interest rates beginning July 1, 2006 are 7.9% Interest rates beginning July 1, 2006 are 7.9%

• Repayment begins 60 days after loan is fully disbursedRepayment begins 60 days after loan is fully disbursed**Credit basedCredit based

Parent Denied for PLUS LoanParent Denied for PLUS Loan::

• Student becomes eligible to borrow additional Unsubsidized Student becomes eligible to borrow additional Unsubsidized Stafford loanStafford loan

• Up to $4,000 for first & second years of undergraduate studyUp to $4,000 for first & second years of undergraduate study

Alternative LoansAlternative Loans Loans through private bank lenders to help Loans through private bank lenders to help

meet costs not covered by other aidmeet costs not covered by other aid

Annual loan limit: COA minus other aidAnnual loan limit: COA minus other aid*Credit based*Credit based

Student applicants usually need a parent or Student applicants usually need a parent or other cosignerother cosigner

Many lenders offer educational loans. Many lenders offer educational loans. Interest rate and terms vary based on lender.Interest rate and terms vary based on lender.

Shop around!Shop around!

Usually deferrable while attending schoolUsually deferrable while attending school

Reviewing Award LettersReviewing Award Letters

2010 – 2011 Financial Aid Eligibility Letter2010 – 2011 Financial Aid Eligibility Letter

Based on full-time enrollment status and EFC of $3,950Based on full-time enrollment status and EFC of $3,950

FallFall SpringSpring Total Total Federal Pell GrantFederal Pell Grant $ 445$ 445 $ 445$ 445 $ 890$ 890Subsidized StaffordSubsidized Stafford 1,750 1,750 1,750 1,750 3,500 3,500Unsub. StaffordUnsub. Stafford 1,000 1,000 1,000 1,000 2,000 2,000Estimated NYS TAPEstimated NYS TAP 250 250 250 250 500 500

TOTAL AWARDSTOTAL AWARDS$3,445$3,445 $3,445$3,445 $6,890$6,890

Reviewing Award LettersReviewing Award Letters

Questions to Consider:Questions to Consider: What is the source of the aid?What is the source of the aid?

i.e. Is it grant or loan money?i.e. Is it grant or loan money? What is the out-of-pocket What is the out-of-pocket

expense?expense? What is the school’s cost of What is the school’s cost of

attendance?attendance? Are the scholarships renewable?Are the scholarships renewable? Do the scholarships have a GPA Do the scholarships have a GPA

requirement?requirement?

Where To Go From Here…Where To Go From Here… Obtain & review admissions & financial Obtain & review admissions & financial

aid materials from each school to which aid materials from each school to which you are applyingyou are applying

Meet all application deadlinesMeet all application deadlines Complete FAFSA & any other Complete FAFSA & any other

application materials, such as College application materials, such as College Scholarship Service’s PROFILE Scholarship Service’s PROFILE application, requiredapplication, required

Investigate other sources of aid Investigate other sources of aid (scholarships, employer tuition (scholarships, employer tuition assistance)assistance)

If you feel you have a special financial If you feel you have a special financial aid circumstance, please contact the aid circumstance, please contact the Financial Aid Office for their policies and Financial Aid Office for their policies and proceduresprocedures

Communicating with Communicating with CollegesCollegesFERPA – Federal Family Educational Rights FERPA – Federal Family Educational Rights

& Privacy Act (1974)& Privacy Act (1974)

What is it?What is it? Federal law that protects the privacy of Federal law that protects the privacy of

student education recordsstudent education records

What does this mean for parents?What does this mean for parents? Find out each school’s FERPA policyFind out each school’s FERPA policy You may need to have written permission You may need to have written permission

from the student for any inquiriesfrom the student for any inquiries You may need identification numbers, You may need identification numbers,

passwords, or PIN numbers to obtain passwords, or PIN numbers to obtain information or even pay the school billinformation or even pay the school bill

Good Luck!!!Good Luck!!!