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 noncitizen
• Have a valid Social Security number (unless
  you're from the Republic of the Marshall Islands,
  the Federated States of Micronesia, or the
  Republic of Palau)
• Comply with Selective Service registration, if
  required (see www.sss.gov for more information)
• Have a 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
• 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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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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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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FAFSA - Two Ways to Apply

• Electronic - Recommended
• FAFSA on the WEB _at_
• www.fafsa.ed.gov
• Reminder - get your PIN number first
  www.pin.ed.gov (parent and student)
• Paper FAFSA
• Forms available from financial aid office or high
  school guidance counselor
• The paper FAFSA colors YELLOW for student info,
  PURPLE for parent info

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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
• 2 3 weeks if paper FAFSA is mailed
• School processing times vary
• 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.
• 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 in postsecondary education
• Real estate and investment net worth

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The Process
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FAFSA
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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 Philosophy
• The Formula
• COA, EFC, NEED
• The Forms
• Paper FAFSA
• FAFSA on the Web Worksheet, for online
  Application

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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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Filling Out the FAFSA

• Tax information
• Use 2006 Federal tax information
• Do not send any other forms with the paper FAFSA
• If using paper, then mail the paper form in the
  envelope provided it is pre-coded for faster
  processing
• 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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Dependent or Independent ?

• Criteria to be Independent
• Born before Jan 1, 1984 (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 US 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 paid
• 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
The Processor uses a formula to determine EFC
or Expected Family Contribution

• What is it?
• How is it determined?
• Why do we need it?

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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 3000
• 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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The Form
FAFSA
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The Form
FAFSA ON THE WEB
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FAFSA on the WEB - Sample Worksheet

• Use of the worksheet is optional it should
  NOT be submitted to the US Dept of Ed or to your
  school.
• Not all of the questions from FAFSA on the
  Web appear in this worksheet, but questions are
  
• generally ordered as they appear online.
• Once you are online, you may be able to skip
  some questions based on your answers to earlier
• questions. The FAFSA on the WEB will
  determine for you which questions can be skipped.

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DO NOT MAIL THIS WORKSHEET.
You must complete and submit a Free Application
for Federal Student Aid (FAFSA) to apply for
federal student aid and to apply for most state
and college aid. Applying online with FAFSA on
the Web at www.fafsa.ed.gov is faster and easier
than using a paper FAFSA. For state or college
aid, the deadline may be as early as January
2007. See the table to the right for state
deadlines. Check with your high school counselor
or your colleges financial aid administrator
about other deadlines.
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FAFSA on the WEB - Sample
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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
• 3.00 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 3.00
• 4,000 max per year
• For both ACG and SMART Grants
• Must be US Citizens
• Must be Pell eligible and a Pell recipient in the
  term the grant is awarded
• Must be enrolled full-time
• Questions on the 2007-2008 FAFSA 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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FFELP / Direct Loans

• There are four types of FFELP/Direct loans
• Subsidized Stafford Loan
• Need based
• Unsubsidized Stafford Loan
• Nonneed based
• Parent Loan for Undergraduate Students (PLUS)
• Graduate PLUS Loan

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Stafford Loans

• FFELP/Direct Loans
• Subsidized Stafford Loan
• Need based
• Unsubsidized Stafford Loan
• Non-need based

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FFELP /DirectAnnual Loan Limits

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

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FFELP / Direct Loans

• Interest rate 6.8 fixed
• FFELP - 1.5 origination fee, 1 default fee
• Direct 2.5 loan fees
• Deferment/Cancellation provisions
• 6 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
• FFELP - 3 origination fee 1 insurance fee
• Direct 4 loan fees
• Loan limits
• Cost of attendance less other aid
• No aggregate limit
• Repayment begins 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
• Minimum GPA 3.5
• In top 25 of graduating class
• Montana resident
• Met college preparatory requirements
• Accepted to a Montana University System College
  or University
• Application and copy of college acceptance letter
  due January 31st

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Governors Postsecondary Scholarship Programs

• Governors Merit Scholarship
• Top 25 of graduating class
• Minimum GPA 3.0
• Same application as MUS Honor Scholarship
• Due March 31st
• Cannot be a MUS Honor Scholarship recipient
• Governors Merit-At-Large Scholarship
• Application online at www.mgslp.org
• Can begin applying January 2, 2007
• Application, list of activities participated in,
  250 word essay, college acceptance letter, copy
  of high school transcript, and Student Aid Report
  (SAR)
• Due March 31st

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Scholarship Searches

• Colleges
• Internet
• www.safmt.org (MCIS)
• 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, FEBRUARY 11, 2007COLLEGE GOAL
SUNDAY

• Come to College Goal Sunday to get FREE
  assistance on 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