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FINANCIAL AID WORKSHOP Putting the pieces together! c.

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Presentation on theme: "FINANCIAL AID WORKSHOP Putting the pieces together! c."— Presentation transcript:

1 FINANCIAL AID WORKSHOP Putting the pieces together! c

2 Financial Aid Jargon > FAFSA >SAR >ISIR >FOTW >PELL >DRN >SEOG >FAO >TAG>EOF >SEN >SUB >UNSUB >CPS >PLUS

3 Purpose and Philosophy of Financial Aid  Provides access to education beyond high school  Allows students the choice of educational programs and schools  Provides initial and continuing financial support to assist eligible students complete their educational goals

4 Funding a College Education  Who is responsible?  Primary responsibility lies with the student and their parents

5 Funding a college education, cont’d.  Parents will contribute to the expenses to the degree they are able  The family’s financial circumstances are evaluated in a fair and equitable manner by the federal government  Special Circumstances Cannot be reported on the FAFSA Send explanation to financial aid office at the intended college  Additional documents will be requested Instances: change in employment status, separation, disability, death of a wage earner

6 Sources of Financial Aid  Gift Aid Grants, scholarships, tuition and fee waivers, etc. These awards DO NOT have to be repaid

7 Sources of Financial Aid, cont’d. Self-Help Aid  Work Study - student is employed while enrolled in coursework or during breaks  Loans - the student and/or parent must repay the loan(s)

8 Funding Sources  Federal Aid Pell Grant Supplemental Educational Opportunity Grant (SEOG) Academic Competitiveness Grant (ACG) National Science and Mathematics to Retain Talent (SMART) Grant TEACH Grants College Work Study Stafford Loan/Direct Loan PLUS Loan Perkins Loan Alternative Loans

9 Funding Sources, contd.  State Aid/NJ Tuition Aid Grant Educational Opportunity Fund NJ Class Loan Many States offer state supported financial aid programs Generally you must be a resident of that particular state and attend a school in that state in order to receive that state’s funding. Information is sent to the state via the FAFSA – no additional application is needed

10 Funding Sources, cont’d.  Institutional Programs Scholarships Grants Waivers  Private Resources Community & Civic organizations Corporations Churches/religious organizations Employers Foundations, Businesses and Charitable organizations

11 Federal Pell Grants  Largest federal grant program  Awarded to eligible undergraduates pursuing first baccalaureate degree and certain students enrolled in post- baccalaureate teacher certification or licensing programs  Portable  Actual award amount based on COA, EFC, and enrollment status  Maximum award for 2009-2010 $5350 - Does not have to be repaid

12 Academic Competitiveness Grant (ACG)  First and second year undergraduate students  Federal Pell Grant recipient  U.S. citizen & eligible noncitizen  Must be enrolled Full time  Completed rigorous secondary school program  Award amounts: $750 first year students $1300 second year students who maintain a 3.0 GPA each semester  Portable  Does not have to be repaid

13 National Science and Mathematics Access to Retain Talent (SMART) Grant  Third and fourth year undergraduate students  Federal Pell Grant recipient  U.S. citizen & eligible noncitizen  Full time  Eligible major (science/math)  Must maintain minimum 3.0 GPA per semester  Award amount: $4,000 for third and fourth year of study  Portable  Does not have to be repaid

14 TEACH GRANT  The Teacher Education Assistance for College and Higher Education (TEACH) Grant Program provides grants of up to $4000 per year to students who intend to teach in public or private elementary or secondary school that serves students from low income families Funds will revert to a loan if requirements are not met

15 TEACH GRANT, cont’d  Program has very specific requirements in order to obtain funding including - but not limited to: GPA, academic program, classes taken, fulfillment of the required service agreement  Not all schools participate.  Speak to the Financial Aid Office at the school(s) you apply to after filing the FAFSA to determine if they participate and if you are eligible

16 Federal Supplemental Educational Opportunity Grant  SEOG - For exceptionally needy students  Priority to Federal Pell Grant recipients  Award amount up to $4,050 per year, as determined by school’s financial aid office  Does not have to be repaid

17 Tuition Aid Grant (TAG)  Funding provided by the State of New Jersey, for New Jersey residents attending New Jersey school  Amount based on financial need  Must be a full time student  Be aware of filing deadlines  Does not have to be repaid  Max award at Ramapo this year is $6904

18 Federal Work Study  Provides part-time employment opportunities  Pay must be at least federal minimum wage and paid on an hourly basis  Employer may be the college or a non-profit community agency  Placement is done through the school  Award amount is earned throughout the year, not applied to payment of the bill

19 Stafford/Direct Loans  Student loans available under: Stafford Loan - Program with funds guaranteed by lenders (e.g., banks/credit unions) handled by the school’s FAO Federal Direct Student Loan (Direct Loan) Program with funds guaranteed directly by the federal government via participating schools  School determines loan eligibility with information from the FAFSA and delivers loan proceeds to student’s accounts  No credit check or cosigner needed for students with these loans  One common application for both loans (FAFSA)

20 Stafford/Direct Loans  Subsidized: The government pays (subsidizes) the interest on the loan while the student maintains enrollment (at least half-time) Must have need.  Unsubsidized: The government does NOT pay the interest on the loan. No need loan. Interest payments for unsubsidized loan can be paid monthly, quarterly or be capitalized; added to the loan principle  All students, regardless of income will be able to obtain a student loan

21 Stafford/Direct Loans  Repayment begins 6-months after graduation or if the student stops attending/drops below 6 credits  Maximum repayment period between 10 and 30 years depending on repayment plan chosen  Deferment and cancellation provisions available

22 Stafford/Direct Loans Currently a fixed interest rate of 5.6% - 6.8% depending on type of loan - sub or unsub, undergraduate or graduate students.  Loan fees based on principle amount of each loan: Stafford:.05% origination fee Direct Loan:.05% loan fee

23 Stafford/Direct Loans cont’d  Base annual loan limits subsidized and unsubsidized for students: $3,500 for 1st year undergraduates $4,500 for 2nd year undergraduates $5,500 for each remaining undergraduate year

24 Stafford/Direct Loans cont’d  All students may borrow an additional $2000 Unsubsidized Stafford/Direct Loan This is in addition to their base annual loan (regardless of if the base loan is sub or unsub).

25 Stafford/Direct Loans  Additional unsubsidized loan eligibility for dependent students whose parents are denied a PLUS: (parents will go through a credit check) $4,000 per year for 1st and 2nd year undergraduates $5,000 per year for remaining years of undergraduate study

26 PLUS Loans  Loan program for parents of dependent undergraduate, graduate and professional students  Annual loan limit: COA minus other aid  Fixed interest rate Stafford: 8.5% Direct Loan: 7.9%

27 PLUS (cont’d)  Loan fees based on principle amount of each loan: Stafford: 2.5% origination fee Direct Loan: 2.5% origination fee Must file a FAFSA Repayment begins 60 days after loan is disbursed (paid to the school) for parent borrowers – or call lender to defer repayment

28 Federal Perkins Loans  Eligible students: Undergraduate, graduate, and professional students Priority to students who show “exceptional need,” as defined by school  Loan amount varies per school  Maximum annual loan amount: $4,000—undergraduate students

29 Federal Perkins Loans  Low interest, subsidized loan  Awarded to neediest students  Interest rate: 5%  9-month grace period for repayment after graduation  Repayment period may be up to 10 years  Deferment and cancellation provisions available

30 Alternative Loans  There are quite a number of education lenders for you to select from. It is advised that you discuss variables with your Loan Counselor to be able to select a lender that will suit your needs.  Some lenders: NJ Class, Sallie Mae, Bank of America, PNC Bank, to name a few.

31 NJ Class Loan  Lender is NJ Higher Education Student Assistance Authority (HESAA)  Can borrow for Out-of-State College  Undergraduate or graduate students, parents, legal guardian, spouse or relative may borrow  Borrowers must be creditworthy or provide a cosigner  Loan may be up to the COA minus other aid

32 NJ Class Loan (cont’d)  Interest rate is fixed  Must file a FAFSA  15 year repayment period, minimum is $50 per month

33 What is Financial Need?  The difference between the Cost of Attendance (COA) and the Expected Family Contribution (EFC)  The need varies between colleges based on their COA  Need determines how much aid you may receive  Non-need based aid: awarded on student’s academic achievements, athletic ability, talent or heritage

34 Definition of Financial Need (Example: RCNJ 09-10)  Cost of attendance includes room and board, tuition/fees, books, transp, etc.  -Expected Family Contribution (EFC)  - Other financial aid (scholarship - waiver)  = Unmet (financial) need  $26,313  -3,250  -12,000  11,063

35 Expected Family Contribution Calculation components  Parents’ prior year income  Student’s prior year income  Value of parents’ and student’s assets Reported assets exclude the value of a family’s principal place of residence. Application instructions include list of reportable assets  Number of household members  Number of household members* attending college at least half-time  Age of older parent

36 Need Comparison Cost of Attendance High Cost School $67,000 Lower Cost School $ 8,500 - EFC -4,000 = NEED$63,000$ 4,500

37 Now what?  File the FAFSA (FOTW)

38 What is a FAFSA for?  All Federal student Financial Aid; grants, loans and work-study  FAFSA information is automatically sent to the state to review for eligibility for state grants and/or scholarship  Some colleges require additional forms such as CSS Profile, school financial aid application - not Ramapo College

39 What happens next…  College Financial Aid Office (FAO) determines COA, Pell Grant eligibility and eligibility for other forms of financial aid  The college FAO sends a financial aid “award” letter to accepted students listing the types of financial aid being offered. This is referred to as a “package”  The “package” usually includes any and all grants, scholarships, loans, and/or workstudy

40 What else to expect…  FAO will request documents from the student and/or parents to complete financial aid file. Some reasons might be: Verification Selective Service Registration confirmation Citizenship confirmation Social Security Number confirmation

41 Application Process  Submit FAFSA prior to school’s deadline  Some aid awarded on “first-come, first- served” basis  To ensure maximum consideration for federal, state, and institutional aid, check information from each school to determine: Required financial aid application forms Application deadlines

42 Application Steps  FOTW – FAFSA on the Web Apply for a PIN (personal identification number) PIN is your electronic signature Student and parent need individual PINs PIN is ‘live’ – no waiting to receive it Can click on to link from FOTW  Student and parent complete online application, ‘sign’ by entering student and parent PIN, click submit

43 PIN Registration  Web site: www.pin.ed.gov – or click on Pin Registration on FAFSA Home pagewww.pin.ed.gov  Can request PIN before January 1 for following academic year Not required, but speeds processing  Same PIN is used by students and parents throughout aid process, including subsequent school years  Siblings will need their own PIN, parent’s PIN remains the same

44 FAFSA on the Web (FOTW)  Good reasons to file electronically: Built-in edits to help prevent costly errors Skip-logic allows student and/or parent to skip unnecessary questions More timely submission of original application and any necessary corrections (via SAR) More detailed instructions and “help” for common questions Ability to check application status on-line Simplified renewal application process

45 FOTW cont’d Web site: www.fafsa.ed.govwww.fafsa.ed.gov If you want a paper FAFSA you must call 1-800-4FEDAID/1-800-433-3243 and request it FOTW can be submitted after January 1  Use “pre-application” worksheet Questions follow order of FOTW

46 On Your Mark…… Review of FOTW

47 FOTW Homepage

48 Confirmation Page

49  After you submit the FOTW – you will receive a Confirmation Page: Confirmation Number Data Release Number (DRN) (for corrections, if necessary) EFC 3-4 days to process If you provide an email address, you receive results from – (allow CPS email address in browser) FederalStudentAidFAFSA@cpsemail.ed.gov

50 CAUTION!  Avoid being charged a fee to file the Free Application for Federal Student Aid Completion and processing of the FAFSA are FREE When filing via FAFSA on the Web, be sure to go directly to www.fafsa.ed.gov Contact financial aid office for help completing the FAFSA

51 Common Mistakes  The question(s) is not read correctly  Leaving blank fields – enter a ‘0’  Using commas or decimal points in numeric fields  Misreport Taxes Paid  AGI, Wages and Taxes paid entered as all the same amount  Divorced/Separated parents include “ex” spouses income or no stepparent tax info  Listing marital status incorrectly  Parent and student Social Security Numbers &/or date of birth incorrect or omitted

52 Common Mistakes Cont’d  Student’s Driver’s License number incorrect  Omit real estate/investment values  Do not list school(s)  Incorrectly report HH size  Incorrectly report number in college  Not having (both) student & parent PIN numbers when submitting FOTW (or don’t to sign and date form before mailing)  Sending paperwork to FAFSA Office

53 Making Corrections  If necessary, corrections to FAFSA data may be made by: Using FOTW (www.fafsa.ed.gov) – Be sure to have your PIN(s) Updating paper SAR, signing and sending to Processor (paper SAR is received only if you don’t submit an email address) Change of address Updating taxes when completed

54 Scholarship Searches “Billions of Dollars Unclaimed...”  Several warning signs of a possible scam Guaranteed winnings… “A list of scholarships is guaranteed” ‘Free seminars’ on financial aid 1-900 telephone numbers Application fees

55 More Scam alerts…  “I just need your credit card number”  “Please enclose a $5 processing fee”  “You’ve been selected” by a group you have never heard of  “You’re a finalist” in a contest you never entered  CAUTION: As a general rule, you shouldn’t have to pay money to get money..

56 So…Avoid Being Scammed To check legitimacy of scholarship search services or individuals, for information about financial aid scams, and tips to avoid being scammed visit these Web sites:  U.S. Department of Education: www.studentaid.ed.gov/students/publicat ions/lsa/index.html  Federal Trade Commission: www.ftc.gov/bcp/conline/publs/alerts/ou chart.htm  Better Business Bureau: www.bbb.com

57 Tips for students and parents  Do not ASSUME your financial status disqualifies you from eligibility – leave your options open, even if it is for loan eligibility only – you do not have to take the loans  Complete your tax return(s) as EARLY as possible  Keep copies/print outs of all applications and forms

58 Tips, cont’d  Always respond to requests for additional information in a timely manner verification, selective service, etc.  Contact a financial aid administrator if you have specific questions – there is no such thing as a stupid question  You must reapply prior to every academic year

59 Scholarship sites on the Web Free Internet scholarship sites:  FastWeb - fastwebcom  SRN Express - srnexpress.com  Scholarships.com  Go College - gocollege.com  College Board – collegeboard.com  Finaid – finaid.org  Embark – embark.com NOTE: Most scholarship search sites are free. You should not have to use any site that charges In most cases you will receive information on scholarships; you will not be able to apply for the scholarship(s) directly over the net, but you will be provided with info on how to apply.

60 Check out Free Scholarship Search Secrets e-Book! Download 46 pages on how to find scholarships, grants, and money for college using popular technologies like Google, RSS, and more! http://www.StudentScholarshipSearch.com/ebook

61 GOOD STUFF ON THE NET  FOTW (FAFSA on the Web): www.fafsa.ed.gov www.fafsa.ed.gov  Education tax incentives (IRS) www.ed.gov/inits/hope/tax_qa  NJ Higher Education Student Assistance Authority (HESAA) www.hesaa.org  The Financial Aid Information Page www.finaid.org  PIN Registration: www.pin.ed.gov  The College Board: www.collegeboard.com

62 Government Resources  Corporation for National and Community Service (AmeriCorps) www.americorps.gov  Veteran’s benefits – www.gibill.va.gov  ROTC scholarships or stipends  Bureau of Indian Affairs (BIA) Grants www.oiep.bia.edu/  State Division of Vocational Rehabilitation  U.S. Department of Health and Human Services (HHS) Bureau of Health Professions www.bhpr.hrsa.gov/dsa

63 Your turn… Remember, always fill out an application --- you never know. My motto is: ‘if you don’t ask, you don’t get’. You won’t be in a worse position if the answer is no. Ask away…… Thank you and have a safe ride home. Dorothy Gillman 201 684-7548 dgillman@ramapo.edu Good Luck!!!


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