Need some advice on undergraduate financial aid!

Hi, I am over 25 but don't have major permanent income. I am enrolling
fulltime this year. My college annual bill is expected to be around $15,000
including books and fees. My EFC from FAFSA is around $1000.

What federal grants and programs I qualify for this coming year, and am
likely to receive that I *dont* hav to pay back?

What federal loans I could receive that I *would* have to pay back? At what
interest rates, under what terms?

What private loan options I have if I don't have a cosigner? What interest
rates and deferrment options they offer?

Should I wait to see what my government financial aid is? Or should I go
ahead an try to secure a loan from a private educational loan anyway? Can I
return the private loan without incurring interest if my government free aid
covers the bill?

Thanks for your advice!

Michael,

Total Cost Of Attendance minus EFC = Need (your maximum eligibility).
Therefore your need is $14,000. It may be more if you are just looking
at what they will bill you plus books. Cost Of Attendance also includes
anticipated living expenses and other miscellaneous expenses (including
commuting costs which I suspect you will have since you didn't mention
room and board costs). Your college can tell you what figure they are
using for you.

In filling your need, only two things are guaranteed if you qualify -
Pell Grants and Stafford Loans. Other financial aid is at the discretion
of the college.

Assuming that you do not already have a bachelor's degree (no Pell if
you do), an EFC of 901-1,000 gets you an automatic Pell grant of $3,100.
If it's 1,001 to 1100 it will be $3,000.

As an independent student (you said you are 25) you will get a
subsidized (no interest) Stafford loan plus an additional unsubsidized
Stafford. All Stafford loan principal payments are deferred until you
leave school, plus a six month grace period.

As a freshman it's $2,625 subsidized plus another $4,000 unsubsidized.
As a sophomore it's $3,000 plus $4,000, and as a junior or senior it's
$5,500 plus $5,000.

For unsubsidized Staffords, or those out of school and in repayment, the
interest is a variable rate set each year. For 04-05 the current rate
for a student still in school is 2.77% and you can choose to pay the
interest or have it added to the loan amount. If interest rates should
rise in future years (bet on it!) the interest is capped at 8.25%.

That's the extent of the automatic money. All other aid is up to the
college and that might include:

As a Pell recipient you are a candidate for a federal Supplemental
Educational Opportunity Grant. SEOG is not automatic - the school
decides who gets it from their allotment from the government. If
awarded, it could be a couple hundred dollars up to 3-4 thousand.

The school also selects recipients for their allotment of Perkins loans
- another interest free loan as long as you are in school, plus 9 months
grace period. Maximum annual amount is $3,000 - it's not common to see
the max. When in repayment, Perkins interest is fixed at 5%.

There are many repayment options on the loans. Typically 10 years, with
options in certain cases for as long as 30.

After that, it's up to the school to decide if it will offer you
work-study, other grants, scholarships or awards that it controls. Those
decisions are based on need and the quality of the student.

For any remaining money, you can borrow through alternative college
loans made by private lenders (your college can give you a list).
Interest rates will be higher than the government loans, and terms will
vary. Depending on your credit status, they may require a co-signer.

Normally you wait until you know how much you might need before
obtaining an alternative loan since there may be some non-refundable
fees. But if you are concerned that they might find a credit problem you
may be able to pre-qualify now with the exact amount to be determined later.

Last point - you say you are enrolling for this year. If you mean
September you should already have applied and been accepted by now, and
if you applied on a timely basis for financial aid you should also have
received the college aid award letter by now. If you were late, this may
limit the discretionary funds still available for you.

If you are looking to enter in January, be aware that the amounts
mentioned earlier are on an annual basis, half disbursed each semester.
If you attend only one semester of 04-05, then you usually will get only
that one semester's disbursement.

--
Steven B. Blank
College Financial Aid Consultants
29 Ives Hill Court
Cheshire, CT 06410
(203)250-7761


Michael D. wrote:
> Hi, I am over 25 but don't have major permanent income. I am enrolling
> fulltime this year. My college annual bill is expected to be around $15,000
> including books and fees. My EFC from FAFSA is around $1000.
>
> What federal grants and programs I qualify for this coming year, and am
> likely to receive that I *dont* hav to pay back?
>
> What federal loans I could receive that I *would* have to pay back? At what
> interest rates, under what terms?
>
> What private loan options I have if I don't have a cosigner? What interest
> rates and deferrment options they offer?
>
> Should I wait to see what my government financial aid is? Or should I go
> ahead an try to secure a loan from a private educational loan anyway? Can I
> return the private loan without incurring interest if my government free aid
> covers the bill?
>
> Thanks for your advice!
>
>