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For some reason, my daughter's school decided that she was not qualified for some of the financial aid she gets. They informed her that she was $2000 dollars short. What gets me, is that they decided this in late April or early May. That's kind of cruel. We thought everything was worked out last fall. Now they spring this on her at the beginning of summer.
They said the FAFSA we filled out recently (I think in December) didn't match the one we filled out before. After getting it redone using IRS transcripts, they said she actually owes $1200, not $2000. That seems better, but that is the family expected contribution. The problem is that our income has dropped substantially since 2015. We do not have $1200. We can't really afford borrowing more, but we did co-sign for a student loan. (see below)
She's working two jobs to try and pay it off this summer. She tried to get a private loan to cover it. We co-signed it. It was all set, but just now the school says Discover Student loans can't be used for an old debt from last semester. This does not make sense to me, but all right we will look for something else . We now need to find either another lender who will, or she has to wear herself out working to pay it, and the rent she pays now at the same time. We would be happy to help if we could, but it is not possible. Any ideas on what she can do other than what she is already doing? Are there lenders who will let her apply it to past debt?
I am not following all of this. But the EFC is what the government determines a family can pay. Unfortunately, that is not what the college says. Reread her awards letter from the semester you are referring to. It will state how much she received and how much she will owe- she had to sign off on the awards letter.
Unfortunately many students have to work during the summer to afford to pay for school. I am not aware of a student lender that will allow you to pay off for a previous semester. She could apply for a loan just like a car loan, but she would probably have to start repaying immediately. Also, $1200 should be attainable with 2 jobs during the summer and then she won't be paying interest. If she can pay some of it off, most colleges will work out a payment plan for the remainder.
But more importantly, how is she affording next semester. Is she loaning more than her Stafford loan? If so, how much? When she graduates will she have a job that will allow her to pay the monthly payment? Or is she attending a college which is just too expensive?
Is the $2000 shortfall associated with a National Merit Scholarship? It has been many, many years since our sons were Undergrad Freshman but I recall that Scholarship being a "One and Done" $2000 award, received for one semester only during the student's Freshman year.
She had everything worked out in the student account. She had full financial aid. The problem was the FAFSA was the same 2 years straight. The second time we filled it out, a mistake was made so it did not match the first time. (She's a third year student this coming fall). Because of the mistake, they decided she was not eligible for all of the grants she was awarded last fall. They decided this during her final week of the academic year. This was not something they decided last fall. It was a brand new decision in April. The FAFSA was for the 2017-2018 year, but since they used the 2015 info for both 2016-17 and 2017-18 years, they retroactively decided she was not eligible for $2000 in grants she was awarded for 2016-17. After correcting the FAFSA for both years, using our IRS transcripts, they changed it to her not eligible for $1200 instead of $2000. I hope this time I described the situation better?
I was upset at the sudden change in her awards at the end of the year. The original award included the $1200 ($2000). However, we have accepted that now so I was not really asking about that. Yesterday, we did find two lenders who will allow the funds to be applied to last year's leftover bill. We applied and are waiting. I'm glad she's working, but we can see that she's not going to earn enough in time to attend classes this fall, so we have to do the loan. I guess I answered my own question.
I'd be really careful about the terms and interest rates of those loans. Maybe more worth it to take a semester off and work. Does she have work study at her school...she should be eligible and those tend to be v flexible jobs.
It's raises a flag that she can't earn another 1200 during the summer. That's just not that much money. Babysitting, waitressing, tutoring, walking dogs even.
I don't know if it's a red flag but she is now in an off campus apartment. The rent is too high and that is the reason it is hard to earn $1200 for last term's bills. You're correct the interest rate is high! 10.49 fixed, and 8.26% variable. We scraped together $500 for her, so I just asked her if earning the remaining $700 is doable.
I'm not sure why it took so long to to discover the error. But if there were errors on fafsa apparently she wasn't entitled to the money.
Why is she living in an apt. That appears to be too expensive? She has plenty of time to earn 1200.
She decided to move there with her dorm roommates, who have plenty of money by the way. She didn't consult me and the landlord did not require we co-sign the lease. It's too late now. She's going to drop the loan and earn what she can. We will scrounge around for $500 or so to help her a little.
This is the only part I'm commenting on - " The problem is that our income has dropped substantially since 2015. We do not have $1200. We can't really afford borrowing more, but we did co-sign for a student loan."
Ok, for college attendance year covering July 2017 through June 2018, taxes from 2015 are used to complete your FAFSA. If there have been financial changes in your income which would affect aid, you should speak to a manager at the college financial aid office and ask for a PROFESSIONAL JUDGEMENT regarding the changes in income that have taken place.
This is the only part I'm commenting on - " The problem is that our income has dropped substantially since 2015. We do not have $1200. We can't really afford borrowing more, but we did co-sign for a student loan."
Ok, for college attendance year covering July 2017 through June 2018, taxes from 2015 are used to complete your FAFSA. If there have been financial changes in your income which would affect aid, you should speak to a manager at the college financial aid office and ask for a PROFESSIONAL JUDGEMENT regarding the changes in income that have taken place.
Thanks for the suggestion. I was thinking to do that already, but I thank you for the info.
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