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FINANCIAL AID INFORMATION Academic Year

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1 FINANCIAL AID INFORMATION 2010-11 Academic Year
Presented by: Student Financial Services Bureau State of Michigan Michigan Department of Treasury Welcome students and parents. Introduce yourself and staff. This presentation lasts about an hour or so. If you have to leave before it ends, we understand. We would like to answer any general questions that may come up. We prefer you hold your personal questions and talk with us one-on-one after the session. If you don’t get your questions answered, feel free to call us (phone number located in the back of the Paying for College book. Take notes as we go along (“Note” page at the end of Paying for College, blank page on page 2 as well) Review handouts Paying for College in MI Guide to Federal Student Aid FOTW Worksheet (hand out if small crowd, or take sample with you) Paper FAFSA (take sample with you) TEACH Grant fact sheet (since it’s not in the Paying for College) Other resources as needed Pencils Highlighters Michigan Postsecondary Handbook (1 copy)

2 What You Will Learn Today
Section 1 General Financial Aid Overview Types and Sources of Financial Aid Free Application for Federal Student Aid (FAFSA) Section 2 Federal Programs Section 3 State of Michigan Programs Section 4 Scholarship Searches and Scams Other Resources Section 4 is a brief overview of: Loans of Last Resort Institutional and Private Resources Tax Credit and Deductions As well as Scholarship searches and scams

3 What is Financial Aid? Money for postsecondary education expenses
- Need-based vs. Non-need (Merit) based - Campus-based vs. Student-based Financial aid refers to the financial support a student receives from the state, federal government, as well as privately funded sources to attend college. It includes loans, grants, scholarships, work-study programs, and tax credits and deductions. 3

4 Purpose of Financial Aid
Promote accessibility Produce educated workers Help retain good students Provide incentives Reward academic achievements Influence choice The primary purpose of financial aid is to enable students to gain access to college who would not otherwise be able to go. Some colleges use financial aid to: encourage students to enroll and graduate from their school. to encourage and outstanding academic performance or special talent (e.g., artistic, athletic). Scholarship and loan programs: encourage students to enter and remain in a certain profession within the state for a period of time. 4

5 Types of Financial Aid Gift Aid Self Help Aid Tax Credits & Deductions
- Scholarships - Grants Self Help Aid - Work-Study - Educational Loans Students Parents Tax Credits & Deductions There are three major types of financial aid – grants and scholarships, work-study, and educational loans. Grants and scholarships are gift aid that is not required to be repaid. Grants are usually based on your financial need. Scholarships are generally based on talent or merit. While there are a number of grants and scholarships available to (your state) students, the (your state) program may be one of the most important and valuable. (Your state) grants are an example of gift aid based on need (and/or) merit. We will discuss state grants in more detail later in the presentation. Work-Study programs provide opportunities for you to earn money to help pay for school expenses. Both you and your parents can borrow from a variety of loan programs to help with your educational expenses. Student loans require repayment, usually with interest, after you are no longer in school. Parent loans may require repayment while you are still in school. 5

6 Financial Aid Principles
Paying for the student’s educational costs is the primary responsibility of the student and the parent(s) Families are evaluated on ability to pay for educational costs – not willingness Families are reviewed and assessed in their present financial condition Families are evaluated in an equitable and consistent manner, recognizing that special circumstances may affect a family’s ability to pay Educational cost is the primary responsibility of the family FAFSA determines the family’s contribution Families are evaluated on their ability to pay for college – not their willingness. The federal government uses the same calculation for every family (see next page). 6

7 Expected Family Contribution
Determined by Federal formula from the information reported on the FAFSA Parent’s contribution from income and assets + Student’s contribution from income and assets = Expected Family Contribution (EFC) The Expected Family Contribution (EFC) is how much money your family is expected to contribute to college education for one year. Typically, the lower your EFC, the more financial aid you will receive. All of this is collected on the FAFSA including: family size number of family members in college family savings current earnings All of this is what you provide on the FAFSA. 7

8 Financial Aid Eligibility Equation
Cost of Attendance - Expected Family Contribution = Financial Need 8

9 Cost of Attendance Tuition and fees Room and board
Books, supplies, equipment, transportation, and miscellaneous personal expenses Loan fees Study abroad costs Disability related expenses Dependent or elder care expenses Cooperative education program costs The cost of attendance is the total amount it will cost you to go to school—usually expressed as a yearly figure. It may include some of these, all of these. Questions should be directed to the college you will be attending. 9

10 Comparing Need Cost of EFC Need Attendance $28,065 $18,247 $27,065
Independent Colleges $18,247 $27,065 Public 4 Year Independent Colleges $10,161 $17,247 Community Colleges Public 4 Year $1,000 Independent college cost more Public 4 year Funded by the state, which enables them to have a lower cost (For a list and location map of these colleges, refer to the back of Paying for College.) Subtract the cost from what the family is expected to pay to come up with the need. This need is what you want financial aid for. $9,161 Community Colleges Cost of EFC Need Attendance 10 5

11 General Eligibility Requirements
U.S. citizen or eligible non-citizen High school graduate, pass the GED test, or have the ability to benefit (as determined by a standardized test) Enroll in a degree or certificate program (may not be a regular high school student at the same time) Register with selective service, if required May not have eligibility suspended or terminated due to drug-related conviction Maintain satisfactory academic progress Eligibility for federal student aid is based on financial need and on several other factors. The financial aid administrator at the college or career school you plan to attend will determine your eligibility. But in general: U.S. citizen or eligible non-citizen High school graduate, pass the GED test, or have the ability to benefit (as determined by a standardized test) Enroll in a degree or certificate program (may not be a regular high school student at the same time) Register with selective service, if required Maintain satisfactory academic progress 11

12 Undergraduate Student Aid by Source (in Billions), 2008-09
Source: The College Board, Trends in Student Aid 2009

13 Seniors, Get Organized! November December January
College admissions applications College essays Letters of recommendation Mail applications as early as possible SAT tests December Wrap up college applications before winter break. Early application responses arrive this month. Get your PIN number. (Remind parents to get a PIN also) January File the FAFSA between now and the end of February November Submit college admissions applications on time. Work hard at completing your college essays. Proofread them rigorously for mistakes. Follow up with your teachers to ensure that letters of recommendation are sent on time to meet your deadlines. Mail applications as early as possible for colleges with rolling deadlines (admissions decisions are made as applications are received). Make sure your SAT/ACT scores are sent to each one of your colleges. December Wrap up college applications before winter break. Make copies of each application before you send it. Take SAT tests. Make sure your scores are sent to each one of your colleges. Early decision and early application responses arrive this month. January File the FAFSA between now and the end of February

14 Free Application for Federal Student Aid (FAFSA)
Only form approved for awarding federal aid – no fee Collects family’s personal and financial information Available in English and Spanish Filing Options Electronic (preferred) Paper Copy of the paper FAFSA and the FOTW Worksheet are here if anyone wants to see them. Refer to page 10 of the Paying for College (note the website right above the gray box)

15 FAFSA Information & Tips
File as soon as possible after January 1 State Priority Date: Due at processor by March 1 Estimated prior year figures may be submitted Dependent student and at least one parent whose information is reported must complete and sign the FAFSA each year Independent student does not need a parent’s signature It is important to submit the FAFSA as early as possible after January 1, but no later than (insert any state specific deadline dates, if appropriate) Remember, families should report estimated student and parent income information if federal income tax forms have not been completed at the time the FAFSA is submitted. There will be plenty of time to make corrections at a late date. 15 15

16 Personal Identification Number (PIN)
Serves as electronic signature on U.S. Department of Education (ED) documents. Obtain PIN at: - or FED-AID Response Time - Immediately - Mail: 7 to 10 days Each student and at least one parent must have a PIN to use as an electronic signature on the FAFSA. Used with: FAFSA (student and parent) Student loan promissory note Obtained online or call customer service. (See website at the top of page 11 in Paying for College) Receive an with the PIN immediately. This will contain a link to our secure PIN delivery Web site where you will be able to input your personal data and retrieve your PIN online. For security purposes, this link will be available for only 14 calendar days. If you do not retrieve your PIN within 14 days, it will be mailed to you at the address you provided. By mail - Have your PIN sent by postal mail within 7-10 days. 16

17 www.federalstudentaid.ed.gov Click
here for access to the paper FAFSA, a link to online version, as well as the FAFSA worksheet. Write this website down. Print your own copies of: Paper FAFSA FOTW Worksheet

18 FAFSA Overview Section 1: Student Information
Section 2: Student Dependency Status Section 3: Parental Information Section 4: Student Finances Section 5: Colleges to Receive Information There are 5 sections to the FAFSA. Student Information Dependency Status of Student Parental Information Student Finances College Choices 18

19 Information Needed Before starting the FAFSA, gather: - Student’s driver’s license - Student Alien Registration Card - Student and Parent prior year tax information Social Security cards W-2 forms and other records of money earned Federal income tax form (even if not completed) Records of untaxed income Current bank statements Business, farm, and other real estate records Records of stocks, bonds, and other investments Create a file for copies of all financial aid documents Here is a list of records you should have available in order to complete the FAFSA. Completing the FAFSA will be easier and less time-consuming if you gather these records before going on-line. This information is listed on the FAFSA and the worksheet. Student will need : -Your driver’s license (if you have one), and -Your Alien Registration Card (if you are not a U.S. citizen) Student and parents may need: - Social Security cards - W-2 forms and other records of any money earned in 2007 - federal income tax returns (if completed). Remember, federal tax returns do not need to be completed to apply for student financial aid. It is more important to submit the FAFSA and other aid applications by the published deadlines using estimated data than to wait until you complete tax returns. - Records of untaxed income - Current bank statements - Business/farm and other real estate records - Records of any stocks, bonds and other investments Keep in mind that not all families will have all of these records. For future reference, be sure to keep copies of all financial documents used to complete the FAFSA, and a copy of the completed FAFSA on the Web Worksheet. You and your family must reapply each year for financial aid. 19

20 Student Information Demographic information Data matches
- DHS (citizenship) - Social Security - IRS - Selective Service - NSLDS - Veteran’s Administration Be careful on: - Spelling of name (as it appears on Social Security card) - Social Security Number - Date of Birth - address (All correspondence will be sent to this address.) When you apply for your PIN, you will fill in your demographics. If you complete the FOTW, the demographics will be pre-populated, so you won’t have to enter that info again. You will need to complete all of the demographics when you complete the paper FAFSA. Citizenship Status. Students must be a U.S. citizen or an eligible non-citizen to receive federal student financial aid. If students have recently become U.S. citizens, they should contact the Social Security Administration (SSA) to update their status. Otherwise, when the U.S. Department of Education matches data with SSA, the Agency may report that they are not citizens and may be considered ineligible to receive federal and state aid. For financial aid purposes, an eligible non-citizen is someone who meets one of the following: -A U.S. permanent resident who has an Alien Registration Receipt Card (I-551) -A conditional permanent resident with a (I-551C), or -A non-citizen with a departure record (I-94) from the Department of Homeland Security showing any one of the following designations: “Refugee,” “Asylum Granted,” “Parolee,” or “Cuban-Haitian Entrant.” Despite not being eligible for federal or state aid, students who are ineligible because they are undocumented may be considered for other institutional aid by some colleges or universities and may, therefore, wish to complete the FAFSA to apply for that aid. Students who fall into this category are encouraged to contact the schools to which they are applying for admission before completing the FAFSA.

21 Student Information (continued)
Collects information about the student’s: - Residency - Selective Service - Males can register with Selective Service Drug Conviction Status (DO NOT SKIP) Parents’ College Education Education Goals (unsure? mark full-time) Interest in Work-Study and Loans Answering “Yes” to work-study and loans does not obligate the student Male students who are 18 years of age or older must be registered with Selective Service to receive federal and state aid. Some colleges and universities may require Selective Service registration for their own funds as well. This information will be confirmed with Selective Service. Students should answer “yes” only if: - they are male, - currently between the ages of (on the day the FAFSA is submitted) and - NOT YET REGISTERED and would like the U.S. Department of Education to register the the student with Selective Service. If the student is male, 17 years of age or younger at the time the FAFSA is submitted, he should leave the question blank. The student must register with Selective Service when he turns 18. He can do this at the Selective Service Web site, If the student is unsure if he has registered, he may go to this same site to verify his registration status. TO RECAP: The following groups of students should leave this question blank: female students male students who are not yet 18 as of the date the FAFSA is submitted and male students who have already registered These questions are used for some state aid purposes and by some schools to help measure a student’s disadvantaged background. The answers do not affect eligibility for federal student aid. Enter the highest grade level completed by your father and mother. Father and mother in these questions mean birth or adoptive parents, not legal guardians, stepparents, or foster parents. Note that this definition of parents is unique to these two questions. In addition, some states and colleges use the answers to these questions to determine if you are the first member of your family to attend college. This may make a difference in the type and amount of aid received because some schools offer additional aid to students who are the first in their family to go to college. NOTE TO PRESENTERS: Discuss the difference between “completed” versus “attended.” For example, if the mother completed an AA degree at a community college, she would mark “High school” because she has not completed a four-year college degree program. Also, if parents completed the equivalent of a bachelor’s degree or higher in a foreign country, they are to mark “College or beyond.” Education Goals – If unsure about enrollment status, choose full-time. You can adjust later.

22 Student Dependency Status
Determines student’s dependency status An independent student is one who: Is 24 years of age, or Is married, or Is working on a master’s degree or higher, or Is currently serving on active duty in the U.S. Armed Forces, or Is a veteran of the U. S. Armed Forces Has a legal dependent who receives more than half their support from the student, or Is an orphan or ward of the court Is an emancipated minor or unaccompanied youth Was a foster child or ward of the court after the age of 13 All other students are dependent 24 years of age prior to January 1 of the calendar year. Married as of the date you file the FAFSA

23 Parental Information A dependent student must complete this section:
Report information for biological or adoptive parent(s) Which parent to use if divorced/separated: In the past 12 months: Which parent did you live with more, or Which parent provided more financial support? Not considered parents: Grandparents Legal guardians Foster parents Collects parents’: Marital status Social Security Numbers, last name, date of birth Residency (important for state aid) Income tax filing status and prior year’s income Exemptions and number in household

24 Parental Information (continued)
How many in household will be in college (exclude parents from number in college) Information about the parent’s untaxed income and benefits - Retirement contributions - Welfare benefits - Child support received - Disability benefits - Workmen’s comp benefits - Tax exempt benefits - Untaxed portion of social - Military security benefits and pensions Information that can be excluded from parental income Education tax credits Child support paid

25 Parental Information (continued)
Investment Assets Include: Trust funds, 529 college savings plans, mutual funds, real estate, investments, second home, vacation home, or rental home Do not include: Primary residence, retirement funds (IRAs, 401k, 403b, Keogh, SEP, etc.) Business and Farm Assets Do not include: Farm that you live on and operate Do not include: A small business (family owns more that 50%) that has 100 or fewer full time equivalent employees Include Trust funds 529 college savings plans mutual funds real estate Investments second home vacation home rental home

26 Student Finances Collects student’s
Prior year income (tax filing status, type and amount of income) Student’s assets and veterans education benefits Independent student’s household and exemptions Untaxed income and benefits Information that can be excluded from income Net Worth: Current value minus debt Report the worth as of the date you file the FAFSA Current value of cash, checking, and savings accounts Investment Assets Include: Trust funds, UGMA accounts, etc. Business and farm assets (not primary residence)

27 Schools to Receive Information
List up to 10 colleges the student is considering (list 4 on the paper FAFSA) Online search capabilities for school codes List at least one Michigan college choice Indicate the type of housing plan for each school All colleges listed will have access to the student’s FAFSA records electronically School code can be found at or call FED-AID For the purpose of state aid, you may want to list your preferred college first.

28 Professional Judgment
Professional Judgment refers to the authority of a college's financial aid administrator to make adjustments to the data elements on the FAFSA and to override a student's dependency status. Each college is responsible for approval Results may differ between colleges Emancipation, Homeless, and Unaccompanied Youth Financial aid office may require student to provide a copy of the determination if student answered yes to these questions. If extenuating circumstances prevent a dependent student from reporting parental information, student should submit the FAFSA and consult the Financial Aid Office at the college you plan to attend. Information on emancipation, and homeless and unaccompanied youth is collected on the FAFSA Financial aid office may require student to provide a copy of the determination if student answered yes to these questions.

29 Special Circumstances
Financial circumstances may change in year of filing. Contact the Financial Aid Office if there is: Loss or reduction in parent or student income or assets Death or serious illness Natural disasters affecting parent income or assets Unusual medical or dental expenses not covered by insurance Reduction in child support, social security benefits or other untaxed benefit Financial responsibility for elderly grandparents Any other unusual circumstances that affect a family’s ability to contribute to higher education Student should contact the Financial Aid Office at the college you plan to attend. Each college is responsible for approving changes in circumstances. Result may differ between colleges. 29

30 Completing FAFSA on the Web-FOTW
More than 95% of FAFSAs are now filed online. Parents with more than 1 college student can transfer data from original application to others Faster turnaround; more accurate

31 FOTW Worksheet Families can use time wisely by completing a worksheet before accessing FOTW Available on Web site, order worksheets at or by phone View a draft of the worksheet on the Web at the URL below. - Click on FAFSAs and Renewal FAFSAs link under Publications

32 Reasons to File Electronically
Built-in edits to prevent costly errors Skip-logic allows student and/or parent to skip unnecessary questions More timely submission of original application and corrections More detailed instructions and “help” for common questions Ability to check application status online

33 Submit the FAFSA Transmit FOTW with appropriate signatures, or
Mail the original paper FAFSA to the address listed on the front of the FAFSA Keep a file containing FOTW worksheet Copy of tax returns Copy of income documents, and asset information Student and parent PINs 33

34 “Practice” FAFSA Options
FAFSA Demo site Web address: fafsademo.test.ed.gov User name: eddemo Password: fafsatest FAFSA4Caster Simulates FOTW Provides early estimate of Federal aid eligibility Can transfer information to FOTW when ready to file FAFSA

35 What’s New for : FAFSA Student marital status - question #16: Report your marital status as of the date the FAFSA is signed; cannot be updated State deadlines updated – Michigan, March 1, 2010 (must be received by this date) Questions 44(f) and 92(f) collect amounts earned from co-op programs at colleges; it will be excluded from income

36 What’s New for : FOTW Male students over the age of 26 will not be asked whether they want to be registered for Selective Service. Students who are independent because of their age or marital status will be asked only the dependency status questions regarding children or other dependents. Certain criteria has been added for certain homeless students to be considered independent.

37 What’s New for : FOTW First-time college students will not see the drug conviction eligibility question because these applicants have never received Title IV aid. Veterans educational benefits are not considered as estimated financial assistance.

38 What’s New for 2010-11 Children of Soldiers
Maximum Federal Pell Grant eligibility for a student whose parent or guardian was a member of the Armed Forces and died as a result of performing military service in Iraq or Afghanistan after 9/11/2001, provided that child was under 24 years old or was enrolled in college at the time of the parent or guardian’s death. Eligible students will be identified through the Departments of Defense and Veterans Affairs

39 What’s New for 2010-11 Special Exceptions
Student’s parents refuse to provide information for FAFSA Student can borrow an unsubsidized Stafford loan only-must document with college or university Student doesn’t have contact with parents due to estranged relationship or other circumstances (possible dependency override)-documentation required-must contact financial aid office at college/university

40 REVIEW FOTW Filing Tips
Gather necessary documents ahead of time Complete a FOTW Worksheet Be aware of deadline dates Save all work periodically Check the FOTW for accuracy Student and parent sign using PIN Print a copy of the FOTW before submitting Keep a copy of the Confirmation Page Let’s review some tips for those who choose to file electronically: Gather necessary documents ahead of time so that completing the application is faster and easier. Completing a FAFSA on the Web Worksheet also makes completing the electronic FAFSA faster and even easier. Use the FOTW Worksheet distributed today or print one by going to Allow ample time to complete the FAFSA for submission by published deadline(s). Assume that the electronic deadline is East Coast time. Check the FAFSA for accuracy prior to submission. Save your work often. We all know how frustrating it is to work on something electronically and, then, to lose it because we haven’t saved it. Sign the application using the student’s and at least one custodial parent’s PIN. Print out a copy of the FAFSA before submitting data electronically. Print and keep a copy of the Submission Confirmation Page for your financial aid file. 40

41

42 Other Important Tips for Students
Encourage students to submit the FAFSA between January 1 and March 1, 2010 Due to economic circumstances in Michigan, colleges/universities have experienced an increase in financial aid applications Submitting the FAFSA after high school graduation is considered late by most schools Student may not have funds available when classes start if they apply late Respond promptly to requests for information Delays can mean losing funds for which the student may be eligible

43 Find out information about the school you want to attend.
COLLEGE NAVIGATOR Find out information about the school you want to attend.

44 Supplemental Forms Institutional application Stafford loan application
Parent (PLUS) Loan application CSS Financial Aid PROFILE (school aid)

45 After Submitting the FAFSA
FAFSA information is received, processed, and the results are sent to: The student The college(s) The Michigan Department of Treasury, Office of Scholarships and Grants Electronic file sent to each college listed on FAFSA If student did not provide address, results are mailed to the student

46 Student Aid Report (SAR)
The SAR summarizes the information you report on your FAFSA. The schools listed on your FAFSA receive copies of your SAR and use the information to determine if you are eligible for federal student aid. If you filed online and provided a valid address, you will receive an within a few days of filing that contains a secure link so you can access your SAR on the Web. If you filed a paper FAFSA or did not provide a valid address, you will receive a paper SAR in about three to four weeks after submitting the FAFSA. It is crucial that you review it and make sure it is accurate and complete.

47 Review the SAR Review the SAR for accuracy; if corrections are needed, correct online or contact college The Financial Aid Office will review your documents and determine your aid eligibility SAR may be selected for verification (verification requires submission of income documents and a verification worksheet) Aid cannot be processed until all required documents have been submitted to the Financial Aid Office

48 Correspondence from College
Everyone who applies will receive notification from the college regarding their eligibility Read all correspondence and promptly follow instructions You do not have to accept all award types, but the college may not replace it with something else Contact the Financial Aid Office if you have questions about your award

49 ABC UNIVERSITY Office of Student Financial Aid Financial Aid Award
Samantha A. Student March 22, College Way Award Year: Anytown, VA SSN: Dear Ms. Student: After reviewing your FAFSA, we are pleased to provide you with the following financial aid offer. This award is contingent upon anticipated annual renewal of funding from federal, state, and private sources. You may accept or decline any of the awards offered. Projected Cost of Education - $15,000 Expected Family Contribution - $3,000 Total Financial Need $12,000 Type of Aid Fall - Spring Total Accept Decline Pell Grant $600 - $600 $1,200 ( ) ( ) FSEOG $800 - $800 $1,600 ( ) ( ) SLM Grant $1,000 - $1,000 $2,000 ( ) ( ) Work-Study $700 - $700 $1,400 ( ) ( ) Perkins Loan $600 - $600 $1,200 ( ) ( ) Stafford Loan $1,300 - $1,300 $2,600 ( ) ( )   Total $5,000 - $5,000 $10,000         Please sign this letter and return it to the financial aid office within two weeks. Read the enclosed information on how to apply and receive the Federal Stafford Loan offered in this letter. If you need additional funding to supplement this offer, please refer to the attachment for information on additional funding options. Signature

50 Federal Programs Need-based Non need-based Unsubsidized Stafford Loan
Pell Grant Federal Supplemental Educational Opportunity Grant (FSEOG) Academic Competitiveness Grant (ACG) National Science and Mathematics Access to Retain Talent (SMART) Grant Work-Study Perkins Loan Subsidized Stafford Loan Non need-based Unsubsidized Stafford Loan Parent Loan (PLUS) Grad PLUS Loan Robert C. Byrd Honors Scholarship Teacher Education Assistance for College and Higher Education (TEACH) Grant See Guide to Federal Student Aid publication Application for these programs is the FAFSA

51 Need-Based Federal Aid
Federal Pell Grant Undergraduates pursuing first bachelor’s degree Amount determined by the EFC Award prorated base on enrollment status Portable Annual Award Limits (currently) $976 to $5,350 Federal Supplemental Educational Opportunity Grant (FSEOG) Priority to Pell recipients Maximum is $4,000 Pell If the student is eligible for a Pell Grant, they’ll receive the full amount they are qualified for. The amount of other student aid they might qualify for does not affect the amount of Pell Grant. FSEOG The amount of FSEOG received depends on: Financial need The amount of other aid received Availability of funds at the school

52 Need-Based Federal Aid (continued)
Academic Competitiveness Grant (ACG) Eligible for a Federal Pell Grant U.S. Citizen Enroll full-time as 1st or 2nd year undergraduate student Complete a rigorous program of study in high school Maximum award 1st year - $750 Maximum award 2nd year - $1,300 Portable Rigorous program of study in Michigan is listed on page 30 of the Paying for College in Michigan publication. 2nd year undergrad must have a 3.0 GPA at the end of first academic year.

53 Need-Based Federal Aid (continued)
National Science and Mathematics Access to Retain Talent (SMART) Grant Eligible for Federal Pell Grant U.S. Citizen Enroll full-time as a 3rd or 4th year undergraduate student Achieve a grade point of at least a 3.0 Pursue a four-year degree in physical, life, or computer science; mathematics; technology; engineering; or foreign languages critical to national security Maximum award for 3rd and 4th years is $4,000 Portable The ACG and SMART grants are intended to encourage students to take a rigorous program of study in high school and pursue majors such as: Math Technology Engineering Languages (critical to national security)

54 Need-Based Federal Aid (continued)
Federal Work-Study Employment may be on or off campus Available for part-time and full-time students, undergraduates and graduates Wages vary depending on type of work Federal Perkins Loan Maximum is $5,500 a year for full-time or part-time undergraduate students Interest rate fixed at 5% Nine (9) month grace period Deferment and cancellation provisions available Work-study Administered by colleges participating in work-study program (check with your college) Paid directly to student for educational expenses at least once a month Encourages: Community service work Work related to course of study The amount earned cannot exceed the amount awarded Perkins Loan Lender is the school 10 year repayment (repay directly to school or servicing agent)

55 Need-Based Federal Aid (continued)
Federal Subsidized Stafford Loan Federal Family Education Loan Program (FFELP) - Funds provided by lenders (e.g., banks or credit unions) Federal Direct Loan Program (Direct Loan) - Funds provided directly by federal government via participating schools School determines eligibility; delivers proceeds to student Annual loan limits: $3,500 for 1st year undergraduates $4,500 for 2nd year undergraduates $5,500 for each remaining undergraduate year Interest rate fixed at 5.6% (loans made after July 1, 2009) Six (6) month grace period Deferment, forbearance, and cancellation provisions available ED pays interest while in school FFELP vs FDLP (determined by college participation)

56 Non Need-Based Federal Aid
Stafford Unsubsidized Loan FFELP or Direct Fixed 6.8% Interest Rate (after July 1, 2009) Student charged interest while in school PLUS Loan Parent loan program for parents of dependent undergraduate students (parents must have good credit history) Annual loan limit – cost of attendance (COA) minus other aid Fixed interest rate - 8.5% for FFELP PLUS Loan - 7.9% for Direct PLUS Loan Repayment begins 60 days after loan is fully disbursed Only principal may be deferred under certain conditions; interest may be capitalized Grad PLUS Loan Available to graduate students Stafford loans differ somewhat. The difference are listed in 2nd and 3rd bullets. Refer to Guide to Federal Student Aid.

57 Non Need-Based Federal Aid (continued)
Robert C. Byrd Honors Scholarship Nominated by high school principal Maintain satisfactory academic progress Enroll full-time U.S. citizen or permanent resident Selective Service Registration, if required Maximum award is $1,500 Portable and renewable for four years Teacher Education Assistance for College and Higher Education (TEACH) Grant U.S. citizen Undergraduate or graduate at eligible school Be enrolled in course work that is necessary to begin a career in teaching or plan to complete such course work. Maintain at least a 3.25 GPA Sign a TEACH Grant Agreement to Serve Maximum award is $4,000 Robert C. Byrd Honors Scholarship (page 37 Paying for College) Students do not apply, they are nominated by their high school principal Students with highest GPA and MME test scores For students who: Maintain outstanding academic achievement Show promise of continued academic excellence Administered at the State level 280 awarded each year TEACH Grant (page 33 Paying for College) Provides grants of up to $4,000 per year to students who intend to teach in a public or private elementary or secondary school that serves students from low-income families. Contact the financial aid office at the college where you will be enrolled. IMPORTANT REMINDER If you receive a TEACH Grant but do not complete the required teaching service, as explained above, you will be required to repay the grants as a Federal Direct Unsubsidized Stafford Loan, with interest charged from the date of each TEACH Grant disbursement.

58 State of Michigan Programs
Need-Based Michigan Competitive Scholarship Michigan Tuition Grant Tuition Incentive Program Non Need-Based Children of Veterans Tuition Grant College Savings Plans MET MESP

59 Need-Based Michigan Aid
Michigan Competitive Scholarship Undergraduate students at approved MI postsecondary institutions Student must demonstrate need and have qualifying ACT score Enroll at least half time MI resident Maintain minimum GPA of 2.0 in college to renew

60 Need-Based Michigan Aid (continued)
Michigan Tuition Grant Students enrolled at MI independent, non-profit, degree-granting college/university Must demonstrate financial need MI resident Enroll at least half time Meet institution’s SAP requirements for renewal

61 Need-Based Michigan Aid (continued)
Tuition Incentive Program Must have been Medicaid Eligible for 24 months out of 36 consecutive months Pays a maximum of 24 semester or 36 term credits per academic year including mandatory fees Qualified students are sent application form Return form prior to: High school graduation or GED completion 20th birthday Encourages students to complete high school by providing assistance for first two years of college.

62 Non Need-Based Michigan Aid
Children of Veterans Tuition Grant Tuition assistance for children older than 16 and younger than 26 who are the natural or adopted child of a certain deceased or disabled Michigan veteran. Eligibility Criteria Michigan resident Enroll at least half-time Maximum Award Amounts $2,800 per year for full-time $2,100 per year for three-quarter-time $1,400 per year for half-time

63 College Savings Plans Current IRAs Education IRAs
Coverdell Education Savings Account UGMA/UTMA Accounts Parents’ Investment Account

64 Michigan College Savings Plans
Michigan Education Trust (MET) Pre-paid undergraduate tuition at today’s prices – three contract types Maximum contributions – 4 years of prepaid contract purchase Use for tuition and mandatory fees Total contract price eligible for state tax deduction No tax on distributions used for higher education expenses Monthly purchase by payroll deduction, ACH or coupon book Michigan Education Savings Program (MESP) Savings/Investment program Maximum contributions – $235,000 Use for higher education related expenses Contributions of $5,000 (single) or $10,000 (joint) eligible for state tax deduction No tax on withdrawals used for higher education expenses Seven investment options

65 Tax Credits and Deductions
American Opportunity Tax Credit Maximum credit of $2,500 100% of the first $2,000 of qualified expenses 25% of the next $2,000 qualified expenses Lifetime Learning Tax Credit Maximum credit of $2,000 Student Loan Interest Tax Deduction Deduct up to $2,500 of student loan interest paid Refer to: Publication 970

66 Other Resources Loan of Last Resort Institutional Resources
Various lending institutions Check with college financial aid office Credit-based loans: interest rates from 4% -15% Co-signer may be required (lower interest rate) Major/area of study may influence repayment terms Watch for fees: disbursement, repayment, co-signer Watch for marketing gimmicks Institutional Resources Trustee Scholarships Foundation Endowment Scholarships Faculty Academic Scholarships Short Term Loans Loans of Last Resort Before you decide to use a financial aid advice service, you should check: With the Better Business Bureau, a school guidance counselor, or a state attorney general's office. Additionally, investigate the organization yourself before making a commitment: Ask for names of three or four local families who have used its services recently. Ask how many students have used the service and how many of them received scholarships or grants as a result. Find out about the service's refund policy. Get everything in writing. Read all the fine print before signing anything.

67 Other Resources (continued)
Private Resources Professional associations Foundations Corporations Community organizations Civic Religious Social Alumni Commercial lending institutions Place of employment Research institutes Hope Tax Credit The amount of your Hope credit for 2008 is gradually reduced (phased out) if your modified adjusted gross income (MAGI) is between $48,000 and $58,000 ($96,000 and $116,000 if you file a joint return). You cannot claim a credit if your MAGI is $58,000 or more ($116,000 or more if you file a joint return). Lifetime Learning Tax Credit After 2002, the credit is equal to 20 percent of the taxpayer's out-of-pocket expenses up to a maximum of $10,000 in expenses. Thus, the maximum Lifetime Learning Credit a taxpayer may claim after 2002 is $2,000. The maximum credit does not change even if the taxpayer is claiming a credit for the expenses of more than one student in the family. Unlike the Hope Scholarship Credit, students are not required to be enrolled at least half-time in one of the first two years of postsecondary education.

68 Searching for Resources the “Traditional Way”
Check your high school bulletin board(s) or ask your guidance counselor Check with local businesses, civic, and social organizations Review library reference books Inquire with employer or parent’s employer

69 Scholarship Searches The College Board www.collegeboard.com
Thomson Peterson’s Mapping Your Future FinAid (FastWeb) See Paying for College in Michigan publication (page 45)

70 Scholarship Scams If it sounds too good to be true . . .
Victims of scholarship scams lose more than $100 million annually Paying money to get money is a scam Duplicates what you can find out for free Watch for Scholarships with application fee Scholarship services who guarantee success Sales pitches disguised as financial aid “seminars” Refer to

71 Summary Student must: Financial Aid Office will:
Apply for admission to the college(s) Apply for PIN access code Complete and submit the FAFSA/Renewal Check with college for other required forms and documents Review Student Aid Report (SAR) Submit required documentation to the Financial Aid Office as soon as possible Financial Aid Office will: Determine eligibility Package aid Send award letter or denial letter

72 Contacts: For Questions or Additional Information
General Information , Ext Web Site: Office of Scholarships and Grants GRANTS Web Site: Michigan Education Trust (MET) 1-800-MET-4-KID Web Site: www. Setwithmet.com Michigan Education Savings Program (MESP) MESP Web Site: Michigan Postsecondary Handbook Look for the hyperlink on the right side of the page under Quick Links. Also located in the back of the Paying for College publication


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