Chapter 13 and college tuition

[beachgirl]

My oldest is graduating high school in May and is starting to look at colleges. Although we are pushing for a public college that accepts HOPE scholarships (in GA, HOPE will pay all of a public college tuition and only a percentage of a private college), there may be a chance that he will be offered a soccer scholarship to a private college. It wouldn't cover all of the expenses because he would have to live on campus. My ch 13 will be over in 1 year. Are we able to apply for financial aid, a college loan or is this completely out of the question? We have a little in his college fund but nowhere near what he'll need. How did any of you send your kids to college while in a ch 13?

[AngelinaCat]

Hi beachgirl:

I totally understand you wanting to help your child with college, but it seems to me that you are BROKE now, or you would not be in a C 13 now. I will sound mean, but the best gift you can give your adult child NOW is to let him learn from your experiences.

Do NOT even think about applying for a loan for him. He can apply for his own scholarships; or if not, he can get a part-time job, and work his way through school like many of us did. That way he will actually learn how to budget and fend for himself--and that, in my humble opinion, is the VERY BEST gift you can give your son.

Stand tough!!

Good luck to you!

[arkienurse]

My oldest is graduating high school in May and is starting to look at colleges. Although we are pushing for a public college that accepts HOPE scholarships (in GA, HOPE will pay all of a public college tuition and only a percentage of a private college), there may be a chance that he will be offered a soccer scholarship to a private college. It wouldn't cover all of the expenses because he would have to live on campus. My ch 13 will be over in 1 year. Are we able to apply for financial aid, a college loan or is this completely out of the question? We have a little in his college fund but nowhere near what he'll need. How did any of you send your kids to college while in a ch 13?

I'm sorry, but no loan in your name. However he can get a loan in his name. When my son started 3 yrs ago, the loan amount was set at 1300 or so per semester for his first year. Each year the amount goes up, but I have lost track of the amount.
And yes, you can apply for federal aid. In fact, most schools seem to require you to fill out the FAFSA whether you will qualify or not.
Hopefully he will have enough scholarship to cover the amount not covered by a student loan.
Good luck.

[Flamingo]

We filed when my youngest was in the 8th grade and she was a senior when we bought out of our Plan early. Our attorney advised us previously that our being in a Chapter 13 would benefit our daughter as to financial aid. Here is what you do. Have your son first apply for government aid (all this information is available through the college finance dept. where he wants to attend school). Your income and last year's tax information will be needed; all that will determine whether or not he qualifies for any government aid; if he does not, the next step is for him to apply for Stafford Loans. Stafford Loans will be in his name and not payable until after he graduates. There is a limit of $3,750 a year I believe per student. While going through all this, he would need to apply for any scholarships or grants that might be available for him through the college. They can provide him with that all information. After all that if there is any amount still due for tuition, he needs to go the private loan route. Your son may also need to look into working part time if another loan is involved.

Hopefully this will give you a good first step as I have been through it - my daughter is now in college but she lives with us instead of on campus and works part-time. Her Stafford Loans cover the rest of her tuition and since she is an in-state student, her tuition is much less and thankfully her college is only 12 miles away.

[MajorMike]

He CAN apply for Stafford loans at about a 6 percent interest rate. He cannot be denied due to credit or any other issue. Here is info on the max for a Stafford loan per year. He must fill out a fasfa first. It is way more then the $3750 a year that Flamingo states:

http://finaid.msu.edu/limits.asp

[Flamingo]

He CAN apply for Stafford loans at about a 6 percent interest rate. He cannot be denied due to credit or any other issue. Here is info on the max for a Stafford loan per year. He must fill out a fasfa first. It is way more then the $3750 a year that Flamingo states:


http://finaid.msu.edu/limits.asp

Dependent freshman have a lower Stafford yearly limit than do upperclassman. I believe the OP's youngest is graduating from high school next May and would be a freshman this time next year. It is lower than the $3750 I quoted (which was an approximate figure since my daughter is now a senior and is eligible for a higher amount). As I mentioned in my posting, the financial aid office at the college in which one is interested in attending is the best source for all sorts of aid beyond the FAFSA and Stafford Loans. There are also Pell Grants and other scholarships which are available. Beyond any government loans, grants or scholarships one can obtain, then private loans are needed if there is still an outstanding tuition balance after all that is applied.

[rrockinggramma]

as a former financial aid officer, what will happen is that the college will make the parents apply first. They will be denied due to the BK and then all the loans will be granted in the student's name. It will all be the same amount for stafford, subsidized or unsubsidized that would have happen if in the parents name. The PLUS loan however is driven by credit so the parents will be denied for this loan but many state goverments have state loans of last resort etc. In my daughter's case, when I was denied the Parent PLUS loan, the college gave her the loan in her name. But the denial was key to having this happen. As a word of advice, try to have the student stay away from private loans. Those in my own humble opinion are just awful. High interest and a lifetime locked in to payments that the interest in NOT controlled by the government. But your student does have other options, in addition to the Stafford loans. There is also work study on campus. And if necessary for a couple of years, the student might want to look at a junior college which is usually cheaper because the student can stay at home.

Yes, the student needs to be looking for scholarships, especially local ones. The high school financial aid office should have information for the student as well as the FAFSA forms. The parents will have to fill out the FAFSA form however to get the ball rolling. No FAFSA, no aid. This will require your income tax information and there is a deadline to getting it in to get the most money awarded from the college. You can't apply for the FAFSA until after Jan 1, 2009 (for 2009 fall semester) You can do it online. (encouraged) Now would be a good time to get your PIN number however and beat the rush. The parents AND the student should have a PIN so the accounts can be accessed online.

Once the FAFSA is submitted the student will receive an award letter. This letter will indicate the EFC (expected family contribution) The difference between the cost of attendance for the college(s) of choice (put the MOST EXPENSIVE college in line 1 of the FAFSA as the aid is awarded by the 1st choice always easier to give back then to add on) and the EFC will be the amount of financial aid the student is qualified for.

Many times the EFC is breathtaking. But this is what the family is expected to contribute. This is where the PLUS loan helps, working helps, etc. However if the EFC is just out of reach, community college may be the next best choice.

GL