The Montana Association of Student Financial Aid Administrators

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The Montana Association of Student Financial Aid
Administrators
Presentation developed and provided free by
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Overview

• About the FAFSA
• Types of Financial Aid
• Other Resources

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Getting Started

• Application for admission may be required before
  aid can be awarded
• Be aware of the schools SAP (Satisfactory
  Academic Progress) policies
• Pay attention to deadlines
• Priority deadline for filing FAFSA
• Admissions application deadline
• Scholarship application deadline
• Award acceptance deadline

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Federal Financial Aid Eligibility Requirements

• Student must have the following
• Be a U.S. citizen or eligible non-citizen
• A valid Social Security number
• Selective Service registration, if required (see
  www.sss.gov for more information)
• High school diploma or a General Education
  Development (GED) Certificate or pass an approved
  ability-to-benefit (ATB) test
• Be enrolled or accepted for enrollment as a
  regular student working toward a degree or
  certificate in an eligible program at a school
  that participates in the federal student aid
  programs

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Eligibility (cont.)

• Also
• You must not owe a refund on a federal grant or
  be in default on a federal student loan
• You must have financial need (except for
  unsubsidized Stafford Loans)
• You must not have certain drug convictions

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Applying for DifferentTypes of Aid

• USE THE FAFSA FOR
• Grants Free or gift aid
• Work Study Self- help must be earned
• Loans Self-help must be repaid
• USE SEPARATE APPLICATION FOR
• Scholarships
• Waivers
• Follow the process at your school

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The Process
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What the heck is the FAFSA?

• FAFSA
• Free
• Application
• For
• Federal
• Student
• Aid
• Emphasis on the FREE Part!

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Components of the FAFSA

• The Form
• FAFSA on the Web Worksheet, for online
  Application
• The Philosophy
• The Formulas
• COA, EFC, NEED

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The Form
FAFSA
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PIN Registration

• Web site www.pin.ed.gov
• Apply now - Both student and parent need a PIN
• PIN is used for FAFSA, MPN, NSLDS access

Add to your address book cpsnotify_at_cpsemail.ed.gov
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FAFSA - Two Ways to Apply

• Electronic - Recommended
• FAFSA on the WEB _at_ www.FAFSA.ED.GOV
• Paper FAFSA
• Limited availability
• www.fafsa4caster.ed.gov
• Available for those who would like an estimate of
  financial aid eligibility

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Filling Out the FAFSA

• Tax information
• Use 2007 federal tax information
• W-2s
• Untaxed income i.e. social security, child
  support
• Student and Parent Information
• Use correct SSNs
• Use LEGAL NAME from Social Security Card
• Accurate date of birth
• School Information
• Identify at least one school
• Can list up to four schools at a time

Contact Financial Aid Office for assistance
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Timelines

• Submit as early as possible after January 1st
• Estimated tax return
• Completed tax return
• Processing Times
• 1 3 days if submitted electronically
• 4 6 weeks if paper FAFSA is mailed
• School processing times vary
• Print and keep your confirmation number for
  tracking!

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Avoid ERRORS!

• Errors made in completing the FAFSA and/or
  supplemental forms may delay application
  processing and result in the loss of financial
  aid funds.
• Please complete all forms carefully!

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Frequent FAFSA Errors

• Divorced/remarried parent information
• Income earned by parents/stepparents
• Untaxed income
• U.S. income taxes paid
• Household size
• Number of family members in postsecondary
  education
• Real estate and investment net worth

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The Student Aid Report

• Check Student Aid Report (SAR) immediately for
• EFC (on upper right of pg 1)
• Any mistakes or omissions
• If you havent received any information within 4
  weeks, contact the financial aid office or
  Federal Processor _at_1.800.4.FEDAID.

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The Philosophy(Why Is All This Information
Needed?)

• Parents and students are primarily responsible
• Families are evaluated in their present financial
  condition
• A familys ability to pay is evaluated in an
  equitable and consistent manner
• Special situations can be considered

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Dependent or Independent ?

• Criteria to be independent
• Born before Jan. 1, 1985 (age 24)
• Working on a graduate degree
• Married
• Have dependents other than a spouse that you
  support more than 50
• Orphan or ward of the court
• Veteran of the U.S. Armed Forces

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Special Circumstancesfor Dependency Issues

• Exceptions to dependency criteria
• Abandonment
• Abuse
• Neglect
• Where safety of student would be compromised by
  contacting parents
• Contact your financial aid officer for help in
• these situations. Documentation is required.

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Divorced/Separated Parents

• Whose information goes on the FAFSA?
• 1. Who did student live with most in last 12
  months?
• 2. If 1 is not clear, who provided the most
  financial support in the last 12 months?
• 3. If neither 1 or 2 clarifies it, choose the
  parent from whom the student most recently
  received the most support.
• Stepparents information is ALWAYS included!

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What if I have a special situation?

• A special conditions appeal may be filed when
  your income has changed due to
• Loss of job
• Death of wage earner
• Divorce
• Unusually high medical bills
• Special conditions are considered after initial
  awards have been determined.

Contact your financial aid office for assistance
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The Formula
Cost of Attendance (COA)
Expected Family Contribution (EFC)
Need
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Whats in the Cost of Attendance?

• Main components
• Tuition fees
• Room board
• Books supplies
• Transportation
• Miscellaneous personal expenses
• Other possible components
• Loan Fees
• Study abroad costs
• Dependent or elder care expenses
• Expenses associated with a disability
• Expenses for co-op education programs

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E F C

• Expected Family Contribution
• Amount the family can reasonably be expected to
  contribute, but not what the family will pay the
  college
• The same regardless of what college the student
  attends
• Two components
• Parent contribution
• Student contribution
• Calculated using FAFSA data and a federal formula

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EFC for Dependent Student

• Step One Determine available parent income
• Total income (taxable nontaxable), less
  exclusions (ex. child support paid)
• Taxes (federal, state, local, social security)
• Income protection allowance for basic living
  expenses (food, shelter, etc.)
• Employment allowance (if eligible)
• Available Parent Income

- -
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EFC for Dependent Student (cont.)

• Step Two Determine available parental assets
• Cash, savings and checking accounts
• Farm/business net worth (after adjustment)
• Real estate/investments equity (excluding
  home)
• - Education savings/Asset Protection Allowance
  (amount determined by age of older parent)
• x Asset conversion rate
• Parents contribution from assets

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EFC for Dependent Student (cont.)

• Step Three Determine available portion of
  parental income assets
• Available income
• Contribution from assets
• Adjusted available income (AAI)
• AAI
• x Assessment rate
• Total parent contribution
• Total parent contribution/ attending college
• Parental contribution

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EFC for Dependent Student (cont.)

• Step Four Dependent Student Contribution
• Total Income (taxable nontaxable) less
  exclusions (ex. Work Study)
• - Taxes
• - Income protection allowance of 3,080
• x 50 assessment rate
• Income contribution from student
• 20 of the student's assets
• Student Contribution

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EFC for Dependent Student (cont.)

• Step Five Total EFC
• Parents contribution
• Students contribution
• Expected Family Contribution (EFC)

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Need Calculation
Cost of Attendance (COA)
Expected Family Contribution (EFC)
NEED
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Need Varies Based on Cost
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How will the financial aid office try to meet my
NEED?


The parent can borrow to meet any unmet need
EFC
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How Financial Need Is Met
Estimated Student Aid by Source for Academic Year
Current Dollars (in Billions)
Source Trends In Student Aid 2005, CollegeBoard
2005 (http//www.collegeboard.com/prod_downloads/p
ress/cost05/trends_aid_05.pdf)
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Types of Financial Aid

• Need Based
• Scholarships
• Grants
• Employment
• Loans
• Non-Need Based
• Loans
• Some scholarships
• Some work-study
• Merit Based
• Scholarships

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Sources of Financial Aid

• Federal
• State
• Institutional (school)
• Private

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Grants
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Available Grants

• Federal Pell Grant
• Federal Supplemental Educational Opportunity
  Grant (FSEOG)
• Montana Higher Education Grant (MHEG)
• Montana Guaranteed Student Loan Program Grant
  (MGSLP)
• Baker Grant (Formerly MTAP)
• Acce Grant

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Available Grants, ContinuedNEW FEDERAL GRANT
PROGRAMS

• National Academic Competitive Grant (ACG)
• First and second-year students
• Rigorous Course of Study
• 3.0 GPA in second year
• 750 first year, 1,300 second year
• National Science and Mathematics Access to
  Retain Talent (SMART)
• Third and fourth-year students
• Must be in specific major
• Cumulative GPA 3.0
• 4,000 max per year

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For both ACG and SMART Grants

• Must be U.S. citizens
• Must be Pell eligible and a Pell recipient in the
  term the grant is awarded
• Must be enrolled full time
• The 2008-2009 FAFSA information will help
  determine students eligibility

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Employment
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Federal State Work Study

• Can be need or non-need based
• On or off campus
• Earnings do not count as income on next years
  FAFSA
• Amount awarded is not guaranteed to be earned

If you did not receive a work-study award, most
schools have a waiting list.
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Student Loans
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Types of Educational Loans

• Federal Loans
• Stafford
• Perkins
• Graduate PLUS
• Parent PLUS
• Private Loans

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Federal Loan Eligibility

• Loans are a type of financial aid
• Need and non-need based
• Enrolled at least half time

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Federal Perkins Loan

• Need based
• Interest rate 5 fixed
• Nine-month grace period
• Deferment cancellation provisions
• Limited funding apply early

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Stafford Loans

• Four types
• Subsidized Stafford Loan
• Unsubsidized Stafford Loan
• Parent Loan for Undergraduate Students (PLUS)
• Graduate PLUS Loan

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Stafford Loans

• FFELP/Direct Loans (two types of Stafford loans)
• Subsidized Stafford Loan
• Need based
• Unsubsidized Stafford Loan
• Non-need based

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Stafford LoanAnnual Loan Limits

• Freshman - 3,500
• Sophomore - 4,500
• Junior/Senior - 5,500
• Graduate and Professional - 8,500

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Stafford Loans

• Interest rate
• 6 fixed (after 7/1/08)-subsidized
• 6.8 fixed on unsubsidized
• Fees
• FFELP - 1 origination fee, 1 default fee
• Direct 2 loan fees
• Deferment/cancellation provisions
• Six-month grace period
• 10-year repayment

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Federal Plus (Parent) Loan

• Interest rate 8.5 fixed
• Borrowers are parents of dependent undergraduate
  students credit check is performed
• Fees
• FFELP - 3 origination fee 1 insurance fee
• Direct 4 loan fees
• Loan limits
• Cost of attendance less other aid
• No aggregate limit
• Repayment begins up to 60 days after fully
  disbursed

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Graduate PLUS Alternative Loans

• Graduate PLUS
• Federal Loan
• 8.5 fixed
• For graduate/professional students
• Private/Alternative Loans
• LAST resort
• Interest and terms vary
• Cannot be combined with federal student loans in
  a federal consolidation always a separate
  payment

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Scholarships
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Scholarship Types

• Merit (Honors)
• Institutional
• Activities
• Community

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Montana University System Honor Scholarship

• MUS Honor Scholarship requirements

• Minimum GPA 3.4
• Based on a composite scholarship score
• Must graduate from an accredited Montana high
  school
• Met college preparatory requirements
• Accepted to a MUS College, University, or
  Community College
• Application, high school transcript through end
  of 7th semester, and copy of college acceptance
  letter due February 15th
• High School Counselor has information

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Governors Merit Scholarship

• Governors Merit Scholarship
• Selected by high school designee no later than
  May 15th
• Minimum GPA 3.0
• Has been accepted by an eligible Montana
  postsecondary institution
• Be a Montana resident
• Cannot be a MUS Honor Scholarship recipient
• Governors Merit-At-Large Scholarship
• Application online at www.mgslp.org beginning
  January 2nd, 2008
• First certificate or degree seeking student
• Application, list of activities participated in,
  250 word essay, college acceptance letter, copy
  of high school transcript, and Student Aid Report
  (SAR)
• Be a Montana resident
• Cannot be a MUS Honor Scholarship recipient
• Due March 31st

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Governors Postsecondary Scholarship Programs

• Governors Need Based Scholarships
• First certificate or associate degree seeking
  student
• Complete FAFSA and do not have an EFC exceeding
  COA
• Are in 4 categories
• General
• Medical
• Technical
• Trades

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Scholarship Searches

• Colleges
• High School guidance counselor
• Internet
• www.smartaboutcollege.org
• www.collegeboard.org
• www.finaid.org
• Avoid scams
• Free, Free, Free!

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Other Resources

• Health Human Services
• Veterans benefits
• Military Service Scholarship (ROTC)
• Bureau of Indian Affairs (BIA) Grants
• Tribal assistance
• Vocational rehabilitation

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Taxpayer Relief Act

• Hope Scholarship Tax Credit
• Lifetime Learning Tax Credit
• Student Loan Interest Deduction
• Education IRA
• College Savings Plans

See IRS Publication 970 _at_ http//www.irs.gov/publ
ications/p970/index.html
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Financial Aid Mistakes to Avoid

• Four Most Common Mistakes
• Submitting an incomplete or inaccurate FAFSA
• Procrastination
• Falling for scholarship and FASFA scams
• Assuming that financial aid is for someone else

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Free HelpSUNDAY, FEB. 10,2008COLLEGE GOAL
SUNDAY

• Come to College Goal Sunday to get FREE
  assistance completing the FAFSA.
• Financial aid experts will be on hand to answer
  your questions, assist with application process.
• See information card in your packet.
• Get a PIN number before you come.

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Questions??

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• Thank you for your time and attention!

Your Montana Financial Aid Officers