Paying for College

Elizabeth DesiSr. Associate Director of Financial Aid

University of New Haven

Applying for Financial Aid

File the Free Application for Federal Student Aid (FAFSA) FAFSA is FREE

FAFSA determines eligibility for: Federal grants and loans

State grants

Applying for Financial Aid

Institutions use the FAFSA to determine eligibility for their need-based scholarships

Schools may require additional forms to determine eligibility for financial aid

CSS Profile

Institutional Application

University of New Haven uses the CSS Profile to provide earlier award information

UNH School Code is 3663

Completing the FAFSA

FAFSA on the Web www.fafsa.gov

File 2015-2016 FAFSA if entering college Fall 2015 (Forms for 2 years on website – use correct year)

Have to complete FAFSA EACH YEAR Available January 1

Two ways to sign PIN – Sign Electronically

www.pin.ed.gov Real Time (“Display Now”)

Both Student and Parent need a PIN

Paper Signature Page

Completing the FAFSA

Can add up to 10 schools on the web application

Should complete and submit the FAFSA when you are applying for Admissions providing you are applying for Admissions after January 1.

Have to be offered Admissions before Financial Aid is determined

Completing the FAFSA

Be Aware of Priority Filing Dates!

Submit FAFSA by School & State Priority Filing Date – CT has had filing date as early as Feb 15

School & State funding is limited so file ON TIME

Can enter estimated income information to meet priority date, then make corrections after you file tax returns

Completing the FAFSA

IRS Data Retrieval Tool Populates your income information directly from the Internal

Revenue Service (IRS)

Complete & file your tax return File Electronically – Wait 2 weeks to correct FAFSA

File Paper – Wait approximately 8 weeks to correct

Students selected for Verification If don’t use IRS Data Retrieval, Tax Return Transcript is

Required

Verification form & Other documentation Required

Note: Schools may have their own Verification process to which they may request tax return transcripts and other documentation beyond the federal requirements

Completing the FAFSA

Parent and Student Information on FAFSA

Student’s Application

If 2 students in family, each complete an application & Parent signs each

Divorced or Separated – Who completes?

Parent with whom student lived with most during the past 12 months

If lived with equally, the parent who provided more financial support

If Parent Remarried

Step-parent information must also be included

Completing the FAFSA

If a dependent student’s parents are living together in the same household, regardless of the parents’ marital status or gender, the income and other information about both legal parents must be included on the FAFSA

Parent marital status option on the FAFSA:

“Unmarried and both parents living together”

Completing the FAFSA

Legal Guardians who has custody of student does NOT complete FAFSA with student

Student completes FAFSA on own

Must provide court documentation to school

If no court documentation, parent must complete FAFSA with student

Processed FAFSA

Student Aid Report (SAR) Indicates your FAFSA has been processed

Indicates how family answered every question on the FAFSA

Review your SAR Indicates the next steps

If there are issues that need to be resolved

Data Base matches – Social Security Number, Citizenship, Selective Service

Will indicate if a student is selected for Verification

Can use to add schools or make corrections

EFC & the School

Results of the FAFSA is the Expected Family Contribution (EFC)

Amount you as a family can contribute toward the student’s education

Schools use the EFC to determine what types of financial aid and how much they can offer to a student

 

Types of Financial Aid

Scholarships Free money – don’t have to repay

Grants Free money – don’t have to repay

Loans Have to repay

Student Employment Have to work to earn the money

Sources of Financial Aid

Federal Money from the federal government

State Money from the State in which you live

Institutional Money from the College/University (merit, need-based,

athletic)

Private Money from private agencies, organizations, civic

groups, high schools, churches, etc.

Cost of Attendance

School determines the Cost of Attendance (budget)

• different at each school

Cost of Attendance includes not only tuition, fees, room, meals (Direct costs) – ALSO Allowances for books, supplies, personal expense, travel expense, misc expense

EFC & the School

School takes Cost of Attendance and subtracts your EFC (results of your FAFSA) to determine a students “financial need”

Cost of Attendance

- Expected Family Contribution (EFC)

_______________________________

Financial Need

EFC & the School

If the EFC is less than the Cost of Attendance, the student may be eligible for subsidized financial aid such as grants, scholarships, subsidized student loans and the parent PLUS loan

EFC & the School

If the EFC is greater than the Cost of Attendance, the student may be eligible for unsubsidized financial aid such as unsubsidized student loans and the parent PLUS loan

Merit scholarships are based on a student’s academic performance and can be awarded regardless of the EFC

Financial Aid Award Letters

The school communicates with the student via a Financial Aid Award

Awards may be electronic or paper

If electronic, student would receive notice or email to view their award information on line

Awards offered are listed on the Award Letter – Awards make up a “Financial Aid Package”

Financial Aid Award Letters

Families should determine Direct costs of the school Tuition, Fees, Room, Meals and any other

expenses charged on the bill

May also want to factor in an amount for books – An average amount per semester for student enrolled full-time is $500 however the sciences, engineering and some other classes may be more expensive.

Financial Aid Award Letters

Families should understand each award listed

Is the award a LOAN? = Money you will have to repay

Is the award a scholarship or grant? = Money you won’t have to repay

Are the scholarships offered by the school renewable and if yes, what are the requirements?

Financial Aid Award Letters

Families should subtract the awards you want to accept from the amount you will be billed by the school to determine how much, if anything, you will need to pay for the student to attend that school

Some options for paying that balance:

Federal Parent Loan

Private Loan

Tuition Payment Plan

Special Circumstances

FAFSA is based on “prior year income”

Use 2014 income information for 2015-2016 FAFSA

Notify the Financial Aid Office of financial changes for 2015 if decreased from 2014

Loss of Job – reduction in income

Extra Medical Expenses

Divorce or Separation

Loan Programs

Schools process federal student and parent loans through Direct Lending

Direct Loan program = The federal government is the lender. The school communicates with the government to process the educational loans

Students will see the federal Direct Student Loan offered on the Financial Aid Award

May see federal Direct Parent PLUS Loan on Award

Loan Programs

The Direct Loan program offers the Federal Student Loan for students and the Federal PLUS Loan for Parents

School will provide information regarding their process and application procedure to apply for the loans - You may also review school’s website for the process

Loan Programs

Students and Parents must sign Promissory Notes for the loans

Students must also complete Entrance Loan Counseling before borrowing the student loan• The loan counseling lets the student know their rights

and responsibilities as a student loan borrower

Student Loans

Direct Student Loans

Low Interest rates

Interest rate set July 1 each year - not to exceed 8.25% - Fixed rate

Student is the borrower

Students are eligible regardless of family income

No penalty for early repayment of loan

Student Loans

The Subsidized Loan will be offered to students who demonstrate “financial need” based on the results of the FAFSA (EFC) and other financial aid the student is receiving

Up to $3,500 for a first year student depending on financial need

July 1, 2014 Fixed interest rate of 4.66% for undergraduates

Government pays interest on Subsidized loans, & principal is deferred while student is enrolled at least half-time

Student Loans

Unsubsidized Student Loan Fixed interest rate is currently 4.66% for undergraduates

Principal is deferred while student is enrolled at least half-time

Interest accrues while student is enrolled. If not paid, it will capitalize causing the balance of the loan to become larger

Interest is charged quarterly (every three months)

Example: $2,000 loan will accrue approximately $100 of interest for a year therefore loan balance will increase to $2,100 in one year

Parent Loan

The PLUS is a Federal Loan for parents to borrow, to assist with paying educational costs

Interest rate is a fixed rate currently at 7.21%

Credit based loan – Government reviews for any negative credit history

Repayment begins 30-60 days after loan is fully disbursed. Parents normally borrow for the full year therefore the loan will not be fully disbursed until spring semester loan disburses, so repayment begins in February or March (option to defer payment until after student is no longer enrolled at least half-time)

Repayment period up to 10 years (depending on loan amount borrowed)

No penalty for early repayment of loan

Parent Loan

Parent may borrow up to Cost of Attendance minus other financial aid the student is receiving (loans are considered financial aid)

Borrowing up to the Cost of Attendance will allow the parent to receive a refund (Remember: Cost of Attendance is more than the actual bill). The refund will act as a reimbursement for educational expenses the parent may have paid to get the student to school and settled in their dorm room

Parent has option of how much to borrow. Parent may want to borrow only what they need to pay the bill

Federal Loans

Parent Loans and Student Loans have Fees

Actual disbursement of loan that is deducted from the student’s bill is lower than amount borrowed (by a small percent)

Student loans approximately 1.073% in fees

Parent loans approximately 4.292% in fees

Example:

Parent Loan for $5,000 with 4.292% in fees will disburse to the school in the amount of $4,785 ($2,392 per semester)

Student Loan for $3,500 with 1.073% in fees will disburse to the school in the amount of $3,462 ($1,731 per semester)

Parent Loan Denial

Some parents may not meet the credit criteria for the parent loan therefore the loan will be denied

Options for Parents:

Appeal the decision and request another review of Credit History if something has changed (if cleared up incorrect/negative issue on credit report)

Obtain an Endorser (someone to co-sign the loan)

Allow the loan to be denied and student borrow LIMITED AMOUNT of additional federal student loan

Parent Loan Denial

When a parent loan is denied, the government allows the student to borrow additional Unsubsidized Student Loan, however the amount is limited (up to $4,000/year for Freshmen and Sophomores, and up to $5,000/year for Juniors and Seniors)

Private Alternative Loans

Sometimes students will need additional funding beyond the financial aid that is offered, therefore there are Private Alternative loans available through lenders

Be sure to review terms & conditions of Private Alternative Loans. May have variable interest rate, require student to make monthly payments immediately, etc.

These loans are not as lenient in repayment as federal loans. They do not have repayment options like federal loans.

Students may borrow up to the Cost of Attendance minus any other financial aid they are receiving (loans are considered financial aid)

 

Private Alternative Loans

The student is the borrower of the loan

Loans are based on credit-worthiness – will likely look at income to debt ratio Co-signer is usually required

These loans may have VARIABLE interest rates

Some now offering Fixed interest rates

May REQUIRE interest to be paid immediately

Could have fees

Cannot consolidate with federal loans

Private Alternative Loans

Student applies with the lender and if loan is approved, the school will determine student’s eligibility for the loan and process if eligible

Check for loan programs within the state Connecticut Higher Education Supplemental Loan Authority

www.chesla.org

Currently has 6.75% Fixed Annual Rate

Currently has a 3% fee

Must make interest payments

Check for loan programs with your credit union for competitive rates/terms

Some lenders/agencies offer loans for parents

Payment Plans

Most schools offer a tuition payment plan

Many contract with outside vendors

May offer a 10 Month interest free plan to pay off the balance due

Payments begin in June and end in March

Normally there is a fee to join (about $70 per year)

Monthly payments are withdrawn from your bank account for 10 months

 

Payment Plans

Because these plans allow a shorter time to pay the balance, you usually have to make a higher monthly payment than you would in repaying a parent loan

Make sure you can afford the monthly payments for the payment plan before signing up

Scholarship Searching

Merit Scholarships

Often offered through Admissions Office rather than through Financial Aid Office

Be sure to meet Admission Application dates & submit appropriate paperwork to be considered

Scholarship Searching

Make sure student completes ALL forms Some Financial Aid offices have a separate form for

students to complete for scholarships Some departments within the college or university

may have their own scholarships to offer and their own process beyond the Financial Aid Office (may require an audition, ie music)

A student should contact the department in which they are majoring or review their website to determine scholarship opportunities and the process

Some departments may offer scholarships to Freshmen, others may not consider a student for scholarships until the student “declares his or her major”

Scholarship Searching

Community Service Organizations & Churches

Company where your Parent is Employed

 

Scholarship Searching

Search on your Own on the Internet Watch for Scholarship Scams

Should not have to pay money to get FREE money

Don’t give bank account or credit card information

www.zinch.com/scholarships

www.fastweb.com

www.collegeboard.com/paying

www.eCampusTours.com/scholarship-search

www.collegeanswer.com

www.finaid.org/scholarships

Finaid.org has scholarship listings categorized by unusual scholarships, average student scholarships, community service scholarships, cancer scholarships, scholarships for Hispanic and Latino students

https://collegesniche.com

Scholarship Searching

Watch for scholarship scams! You should not have to pay money to get FREE money

6 things to look for in detecting a scholarship scam: “a scholarship guarantee” – No service can guarantee it will get you money.

“the service will do all the work” – No service can provide all of the personal information required, fill out essays, or supply the references a scholarship may require.

“for a small fee we will give you a list of scholarships” – You should never pay any amount of money for a scholarship. Applying for scholarships should be free.

“you can only find this information here” – Scholarships, grants and awards for school are available in directories and all over the web. No one organization has a monopoly on the information

“being a finalist in a contest you never entered or randomly being selected by a national foundation to receive an award” – Most organizations only contact you after you have made an inquiry

“everybody is eligible” – Scholarships are usually based on merit or need and restrictions usually apply

“a service needs your credit card or checking account information” – NEVER!

 

Other Resources

U.S. Department of Education, Student Aid on the Web www.studentaid.ed.gov

Select “Types of Aid”

Select “Learn More” in the “Scholarship Search” box

Select “FREE scholarship search tool” under “How do I find scholarships?

State of Connecticut Dept. of Higher Education

www.ctdhe.org and select “Financial Aid” at top of screen on right

Net Price Calculator

Go to www.newhaven.edu

Select “Quick Links”

Select “Net Price Calculator”

Provides an ESTIMATE of the financial aid you could receive – This is NOT an award

Some funds are limited – may see in NPC results but not on your Financial Aid Award

Try to provide accurate estimated information

Results will not be an accurate estimate if incorrect information is provided 

Paying for College

Questions?