The Financial Aid Process

Paying for College

Marla SweningsonFinancial Aid CounselorGeorge Fox University

Topics We Will Discuss Tonight

• What is financial aid?

• Categories, types and

sources of financial aid

• What is a FAFSA?

• Expected Family

Contribution (EFC)

• Cost of attendance

Ask questions…

• To provide access – regardless of income

• To provide choice – regardless of cost

• To recruit – desirable students

What is Financial Aid?Funds provided from a source other than the family to help pay for college expenses

Types of Financial Aid

gift aid

self-help

aid

Grants

Scholarships

Loans

Work-Study

Gift Aid: Scholarships

• Money that does not have to be paid back

• Awarded on the basis of merit, skill, or unique characteristic

Gift Aid: Grants

• Money that does not have to be paid back

• Usually awarded on the basis of financial need so FAFSA may be required

Self-help aid: Loans

Money that students and parents borrow to help pay college expenses

Available from the government and private lenders

Repayment usually begins after education is finished

Only borrow what is really needed

Look at loans as an investment in the future

Allows students to earn money to help pay for educational costs

Self-help aid: Work-Study

A completed FAFSA is required

Funds are limited and available only at participating colleges/universities

Priority deadlines may apply

A student must earn these funds

Compensation is usually minimum wage

Financial aid comes from a variety of sources.Sources of Financial Aid

college(institutional aid)

outside/private

sources

federalgovernment

state government

• Largest source of financial aid

• Aid awarded primarily on the basis of financial need

• Must apply each year using the Free Application for Federal Student Aid (FAFSA)

Federal Government

Common Federal Aid Programs

Federal Pell Grant

Federal Supplemental Educational

Opportunity Grant

Federal Work-Study

Federal Perkins Loan

Subsidized and Unsubsidized

Stafford Loans

Federal Teach Grant

PLUS Loans

Federal Loan ProgramsU. S. Department of Education

Type GraceRate

Perkins Subsidized 5.0%Fixed

Up to $5,500 per year

9 Months

Stafford(2014-2015)

Subsidized 4.66%Fixed

$3,500 first-year

undergraduate

6 Months

Unsubsidized 4.66% Fixed

$2,000 first-year

undergraduate

6 Months

PLUS (parent loan)

Credit-basedUnsubsidized

7.21%Fixed

Depends on remaining

financial need

Within first 60 days

Amount

Free Application for Federal Student Aid (FAFSA) – www.fafsa.gov

• January 1 - First date to submit FAFSA• Must be renewed every yearWHEN

• Available to H.S. seniors, college students, returning adults

• U.S. citizens and eligible non-citizensWHO

• Available in English or Spanish• A standard form that collects demographic and

financial information about the student and familyWHAT

• Determines eligibility for federal and state financial aid programs

• Used by colleges and universities to award institutional aid

WHY

oSocial Security Number

oRecords of income, such as income earned from work and business, child support paid or received, and any other untaxed income. If available, refer to the W-2 Forms and the Federal Income Tax Return IRS 1040, 1040A, or 1040EZ.

o Information about assets, such as savings, certificates of deposit, stock options, bonds, 529 plans and other college savings programs, and investment real estate, business, and farm.

oDriver’s license number, if the student has one.

oAlien Registration Number, if not a U.S. citizen.

oFAFSA on the Web Worksheet – use as an optional “pre-application” checklist

What information is needed?Completing the FAFSA

• Serves as an electronic signature and provides access to personal records on Federal Student Aid systems

• Go to www.pin.ed.gov

• PIN is conditional until information is verified with the Social Security Administration (1-3 days)

• Parents and students need separate PINs to use the FAFSA on the Web

• New login process to be implemented Spring 2015

Personal Identification Number (PIN)

PIN Checklist

oSocial Security Number

oLast Name

oFirst Name

oMiddle Initial

oDate of Birth

oAddress

• Transfers student or parent tax data directly from the IRS to the FAFSA

• Available in early February 2-3 weeks after filing taxes electronically 8-11 weeks after filing taxes by paper

• Acceptable method of providing tax data if chosen for FAFSA verification

Other method – obtain Tax Return Transcript from IRS (www.irs.gov)

• Not available for: Amended tax returns Tax extensions

IRS Data Retrieval Tool

Avoid Common Errors

• Social Security Number – student and parents

• Legal name – MUST match name on Social Security card

• Divorced/married parental information

• Income earned by parents/stepparents

• U.S. income taxes paid

• Household size

• Number of household members in college

• Selective Service registration – all males aged 18 - 26

Calculated using data from the FAFSA and a pre-set federal formula

Expected Family Contribution

What? Why? Where?The amount of money a student and family may reasonably be expected to contribute over the course of an academic year

Used to determine a student’s eligibility for most federal and state assistance

Shown on the Student Aid Report (SAR), the output document sent to a student after the FAFSA is processed

EFCExpected Family Contribution

Tuition & Fees

Room & Board

Transportation

Books & Supplies

Miscellaneous Living Expenses

Cost of Attendance (COA)

+

What are the costs?

Directexpenses

Indirectexpenses

Direct/Indirect expenses

Cost of

Attendance

(COA)

Expected

Family

Contribution

(EFC)

Financial

Need- =

How much aid can a student receive?Financial Need

College

A

Three Examples

COA(Cost of Attendance)

EFC(Expected Family

Contribution)

Financial Need

$3,000$5,000 $2,000

$3,000$25,000 $22,000

-

-

=

=

$3,000$50,000 $47,000- =

College

BCollege

C

• Oregon Opportunity Grant

• Grant awarded on the basis of financial need

• Must apply each year using the FAFSA

• 2014-15 award was $2,000 for full-time, full-year attendance at any eligible Oregon institution

• Funds are limited so apply early!

State of Oregon

• Academic Scholarships

• Other merit-based scholarships (athletic, music, art, leadership, etc.)

• Endowed scholarships

• Need-based grants

Types of College/Institutional Aid

• Office of Student Access and Completion (OSAC) – Feb 15 earlybird deadline – www.oregonstudentaid.gov

• Local community organizations, businesses and churches

• Employers

• Internet search

Private Sources of Financial Aid

Small scholarships add up!

The Financial Aid Process

Complete FAFSA

(Jan. 1 or after)

Receive and review the

Student Aid Report

Complete verification process

(if selected)

Receive and review

Award Offer

Respond

to college

Complete all pending

processes

Renew FAFSA

every year

Evaluating Financial Aid Packages

Biggest is not always best – compare to cost of attendance for each school

Renewable vs. non-renewable scholarships

Grants vs. loans

Terms and conditions of loans

Balance work with academic responsibilities

What is the out-of-pocket cost?

Helpful Hints

• Apply early if possible

• File tax returns early – use the IRS Data Retrieval Tool to download your tax information to the FAFSA

• You may be asked to submit documentation to the financial aid office for verification purposes

• Pay attention to deadlines!

• Supplemental applications or forms may be required

• Avoid scholarship scams

• Involve student in the process

Trusted Web Sites

fafsa.gov

studentaid.ed.gov

oregonstudentaid.gov

studentloans.gov

finaid.org

fafsa4caster.ed.gov

Questions?