Elizabeth Desi Sr. Associate Director of Financial Aid University of New Haven

 Financial Aid – What is it?  The process for Applying for financial aid  The school’s role  Financial aid award letters  Special circumstances  Loan programs  Scholarship searching  Estimating your financial aid at schools

 Financial Aid = funding to help pay for college  Why do we need financial aid? ◦ College costs money to attend  Community Colleges, State Schools, & Private Schools

 Scholarships  Free money – don’t have to repay  Grants  Free money – don’t have to repay  Loans  Have to repay  Student Employment  Have to work to earn the money

 Federal  Money from the federal government  State  Money from the State in which you live  Institutional  Money from the College/University (merit, need- based, athletic)  Private  Money from private agencies, organizations, civic groups, high schools, churches, etc.

File the Free Application for Federal Student Aid (FAFSA) FAFSA is FREE FAFSA determines eligibility for: Federal grants and loans State grants

 Institutions use the FAFSA to determine eligibility for their need-based scholarships  Schools may require additional forms to determine eligibility for financial aid  CSS Profile  Institutional Application  University of New Haven uses the CSS Profile to provide earlier award information  UNH School Code is 3663

 FAFSA on the Web ◦  File FAFSA if entering college Fall 2016  (Forms for 2 years on website – use correct year) ◦ Have to complete FAFSA EACH YEAR ◦ Available January 1, 2016  NEW!! FAFSA available in October  Will need to get FSA ID to sign  Go to fsaid.ed.govfsaid.ed.gov  Both Student and Parent need an FSA ID ◦ Paper Signature Page option

You will need to:  Create your User Name & Password  Create Challenge Questions  Enter a significant date that is not your date of birth  Wait days to use your FSA ID  Social Security Administration must verify your identity before your FSA ID is available for use

 Student Information sections & Parent Information sections – BE CAREFUL WHEN COMPLETING  Can add up to 10 schools on the web application  Should complete and submit the FAFSA when you are applying for Admissions (providing you are applying for Admissions after January 1.)  Have to be offered Admissions before Financial Aid is determined

 Be Aware of Priority Filing Dates ◦ Submit FAFSA by School & State Priority Filing Date – CT has had filing date as early as Feb 15 ◦ School & State funding is limited so file ON TIME  – You can enter estimated income information to meet priority date, then make corrections after you file tax returns  For = You will be able to enter actual tax data & use the Data Retrieval Tool – Prior Prior Year Income

 IRS Data Retrieval Tool ◦ Populates your income information directly from the Internal Revenue Service (IRS)  Complete & file your tax return ◦ File Electronically – Wait 2 weeks to correct FAFSA ◦ File Paper – Wait approximately 8 weeks to correct  Students selected for Verification ◦ If don’t use IRS Data Retrieval, Tax Return Transcript is Required ◦ Verification form & Other documentation Required Note: Schools may have their own Verification process – they may request tax return transcripts and other documentation beyond the federal requirements

 Parent and Student Information on FAFSA  Student’s Application  If 2 students in family, each complete an application  Parent signs each  Divorced or Separated – Who completes? ◦ Parent with whom student lived with most during the past 12 months  If lived with equally, the parent who provided more financial support  If Parent Remarried ◦ Step-parent information must also be included

 Both parents living together but not married, both parent’s information must be on the FAFSA ◦ Example: Divorced but living in the same house ◦ Example: Never married but living together  Legal Guardians don’t complete FAFSA ◦ Student completes FAFSA on own ◦ Must provide court documentation to school ◦ If no court documentation, parent must complete FAFSA with student

 Student Aid Report (SAR) ◦ Indicates your FAFSA has been processed ◦ Indicates how family answered every question on the FAFSA  Review your SAR ◦ Indicates the next steps ◦ If there are issues that need to be resolved ◦ Data Base matches – Social Security Number, Citizenship, Selective Service  Will indicate if a student is selected for Verification

Results of the FAFSA is the Expected Family Contribution (EFC) Amount you as a family can contribute toward the student’s education Schools use the EFC to determine what types of financial aid and how much they can offer to a student

 School determines the Cost of Attendance (budget) different at each school  Cost of Attendance includes not only tuition, fees, room, meals (Direct costs) – ALSO Allowances for books, supplies, personal expense, travel expense, misc expense

 School takes Cost of Attendance and subtracts your EFC (results of your FAFSA) to determine a students “financial need” Cost of Attendance -Expected Family Contribution (EFC) ___________________________________________ Financial Need

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

 If the EFC is greater than the Cost of Attendance, the student may be eligible for unsubsidized financial aid such as unsubsidized student loans and the parent PLUS loan  Merit scholarships are based on a student’s academic performance and can be awarded regardless of the EFC

The school communicates with the student via a Financial Aid Award Awards may be electronic or paper If electronic, student would receive notice or to view their award information on line Awards offered are listed on the Award Letter – Awards make up a “Financial Aid Package”

 Families should d etermine Direct costs of the school Tuition, Fees, Room, Meals and any other expenses charged on the bill May also want to factor in an amount for books – An average amount per semester for student enrolled full-time is $500 however the sciences, engineering and some other classes may be more expensive.

 Families should understand each award listed Is the award a LOAN? = Money you will have to repay Is the award a scholarship or grant? = Money you won’t have to repay Are the scholarships offered by the school renewable and if yes, what are the requirements?

 Families should subtract the awards you want to accept from the amount you will be billed by the school to determine how much, if anything, you will need to pay for the student to attend that school ◦ Some options for paying that balance:  Federal Parent Loan  Private Loan  Tuition Payment Plan

 FAFSA is based on “prior year income” ◦ Use 2015 income information for FAFSA  Notify the Financial Aid Office of financial changes for 2016 if decreased from 2015 ◦ Loss of Job – reduction in income ◦ Extra Medical Expenses ◦ Divorce or Separation

 Schools process federal student and parent loans through Direct Lending Direct Loan program = The federal government is the lender. The school communicates with the government to process the educational loans Students will see the federal Direct Student Loan offered on the Financial Aid Award May see federal Direct Parent PLUS Loan on Award

 The Direct Loan program offers the Federal Student Loan for students and the Federal PLUS Loan for Parents School will provide information regarding their process and application procedure to apply for the loans - You may also review school’s website for the process

 Students and Parents must sign Promissory Notes for the loans  Students must also complete Entrance Loan Counseling before borrowing the student loan The loan counseling lets the student know their rights and responsibilities in being a student loan borrower – It’s a learning tool

 Direct Student Loans Low Interest rates Interest rate set July 1 each year - not to exceed 8.25% - Fixed rate Student is the borrower Students are eligible regardless of family income No penalty for early repayment of loan

 The Subsidized Loan will be offered to students who demonstrate “financial need” based on the results of the FAFSA (EFC) and other financial aid the student is receiving Up to $3,500 for a first year student depending on financial need July 1, 2015 Fixed interest rate of 4.29% for undergraduates Government pays interest on Subsidized loans, & principal is deferred while student is enrolled at least half-time

 Unsubsidized Student Loan Fixed interest rate is currently 4.29% for undergraduates Principal is deferred while student is enrolled at least half-time Interest accrues while student is enrolled. If not paid, it will capitalize causing the balance of the loan to become larger Interest is charged quarterly (every three months) Example: $2,000 loan will accrue approximately $120 of interest for a year therefore loan balance will increase to $2,120 in one year

The PLUS is a Federal Loan for parents to borrow, to assist with paying educational costs Interest rate is a fixed rate currently at 6.84% Credit based loan – Government reviews for any negative credit history Repayment begins days after loan is fully disbursed. Parents normally borrow for the full year therefore the loan will not be fully disbursed until spring semester loan disburses, so repayment begins in February or March (option to defer payment until after student is no longer enrolled full-time) Repayment period up to 10 years (depending on loan amount borrowed) No penalty for early repayment of loan

Parent may borrow up to Cost of Attendance (COA) minus other financial aid the student is receiving (loans are considered financial aid) Borrowing up to the COA create an overpayment on the student account (Remember: COA is more than the actual bill). The overpayment may be refunded & will act as a reimbursement for educational expenses the parent may have paid to get the student to school and settled in their dorm room Parent has option of how much to borrow. Parent may want to borrow only what they need to pay the bill

Parent Loans and Student Loans have Fees Actual disbursement of loan that is deducted from the student’s bill is lower than amount borrowed (by a small percent) Student loans approximately 1.068% in fees Parent loans approximately 4.272% in fees Example: Parent Loan for $5,000 with 4.272% in fees will disburse to the school in the amount of $4, ($2, per semester) Student Loan for $3,500 with 1.068% in fees will disburse to the school in the amount of $3, ($1, per semester)

Some parents may not meet the credit criteria for the parent loan therefore the loan will be denied Options for Parents: Appeal the decision and request another review of Credit History if something has changed (if cleared up incorrect/negative issue on credit report) Obtain an Endorser (someone to co-sign the loan) Allow the loan to be denied and student borrow LIMITED AMOUNT of additional federal student loan

When a parent loan is denied, the government allows the student to borrow additional Unsubsidized Student Loan, however the amount is limited (up to $4,000/year for Freshman and Sophomores, and up to $5,000/year for Juniors and Seniors) Student must accept the additional Unsubsidized loan award, before a school can process the additional amount

Another loan option available through a variety of lenders Be sure to review terms & conditions of Private Alternative Loans. May have variable interest rate, require student to make monthly payments immediately, etc. These loans are not as lenient in repayment as federal loans. They do not have repayment options like federal loans. Students may borrow up to the Cost of Attendance minus any other financial aid they are receiving (loans are considered financial aid)

The student is the borrower of the loan Loans are based on credit-worthiness – will likely look at income to debt ratio Co-signer is usually required These loans may have VARIABLE or Fixed interest rates May REQUIRE interest to be paid immediately Could have fees Each lender sets the terms and conditions for the private loan program they offer

 Student applies with the lender and if loan is approved, the school will have to process the loan  Check for loan programs within the state ◦ Connecticut Higher Education Supplemental Loan Authority ◦ ◦ Currently has 4.95% Fixed Annual Rate ◦ Must make interest payments ◦ Up to 3% in fees  Check for loan programs with your credit union for competitive rates/terms  Some lenders/agencies offer loans for parents

Most schools offer a tuition payment plan Many contract with outside vendors May offer a 10 Month interest free plan to pay off the balance due for the year Payments begin in June and end in March Normally there is a fee to join (about $70 per year) Monthly payments for 10 months

Because these plans allow a shorter time to pay the balance, you usually have to make a higher monthly payment than you would in repaying a parent loan Make sure you can afford the monthly payments for the payment plan before signing up

 Merit Scholarships ◦ Often offered through Admissions Office rather than through Financial Aid Office  Be sure to meet Admission Application dates & submit appropriate paperwork to be considered  Scholarships for athletic ability or talent, ie band, music, etc

Make sure student completes ALL forms Some Financial Aid offices have a separate form for students to complete for scholarships Some departments within the college or university may have their own scholarships to offer and their own process beyond the Financial Aid Office A student should contact the department in which they are majoring or review their website to determine scholarship opportunities and the process Some departments may offer scholarships to Freshmen, others may not consider a student for scholarships until the student “declares his or her major”

Community Service Organizations & Churches Company where your Parent is Employed

Search on your Own on the Internet ◦ Watch for Scholarship Scams  Should not have to pay money to get FREE money Don’t give bank account or credit card information Finaid.org has scholarship listings categorized by unusual scholarships, average student scholarships, community service scholarships, prestigious scholarships

 Watch for scholarship scams! ◦ You should not have to pay money to get FREE money  6 things to look for in detecting a scholarship scam: ◦ “a scholarship guarantee” – No service can guarantee it will get you money. ◦ “the service will do all the work” – No service can provide all of the personal information required, fill out essays, or supply the references a scholarship may require. ◦ “a scholarship costs money” – Though some legitimate scholarships charge fees, be wary of charges. Applying for scholarships should NOT cost you money. ◦ “you can only find this information here” – Scholarships, grants and awards for school are available in directories and all over the web. No one organization has a monopoly on the information ◦ “being a finalist in a contest you never entered or randomly being selected by a national foundation to receive an award” – Most organizations only contact you after you have made an inquiry ◦ “a service needs your credit card or checking account information” – NEVER! 

U.S. Department of Education, Student Aid on the Web Select “Types of Aid” Select “Learn More” in the “Scholarship Search” box State of Connecticut Dept. of Higher Education and select “Students & Families” in the center of the screen

Go to Select “Quick Links” Select “Net Price Calculator” Provides an ESTIMATE of the financial aid you could receive – This is NOT an award Some funds are limited – may see in NPC results but not on your Financial Aid Award Try to provide accurate estimated information Results will not be an accurate estimate if incorrect information is provided

Questions?