Expert: Les Thomas - 10/20/2011

Question
My situation is a bit unique (that's what i think) I am a US citizen who grew up in a foreign country. I live with my parents and they are not US citizens, they are citizens of this country.I'm a US citizen just because I was born in US. To be more specific I have dual citizenship. I don't have American education background or anything in US except some legal papers that show I'm a citizen. But I always want to go back to so I want to start by studying in US.I found out about FAFSA and start filling it out. I'm considered as an independent student because I'm 25.My question is am going to receive enough fund to cover my tuition?are there loans that I'm eligible for?I cant rely on my parents because they don't make much money. And I don't have anyone to be my co-signer.please help me Les.

Answer
Zafran,

You are right... this is not a typical student situation.  But here's the rules.  Once you've reached the age of 25, you are considered independent of your parents income with regards to the FAFSA Form.  To be eligible to receive any Financial Aid what-so-ever... you must fill out, and submit the FAFSA Form.

The US Department of Education will then forward a Student Aid Report to the College you've made application to, advising them of your EFC amount, (or what is commonly referred to as your Espected Family Contribution).  You will also be able to access your EFC amount of the FAFSA website.

In calculating what you will have to pay for College... you would subrtact your EFC from the Colleges COA (Cost of Attendance).  Assuming your EFC is lower than the COA, this will give you an amount left over which is referred to as "Need".  (This is where the term "Need Based Financial Aid" comes from).

Now here is the challenging part for all students.  Each College participates differently with the remaining "Need" amount.  Typically State Colleges, will offer about 50% participation with "Need Aid".

Let me give you an example... Lets' say you want to go to College A, and the COA is $25,000 per year.  Your EFC came back at $10,000.  You would subtract the $10,000 from the $25,000... and you would qualify for $15,000 in Need Based Aid.  However College A only participates with 50% of what you need.  So they are going to base their Fiancial Aid on only $7,500... and the other $7,500 hundred is called "Un-Met Aid", and must be paid by the student, in full.  (No loans for this amount, unless you go out on your own and secure a loan by your self).

Now... of the $7.500 that College A is going to participate in... 50% or $3,750 of that is given in what they refer to as "Gift" (Free Money that never has to be paid back), and the other 50% or $3,750 is given in Self Help which is another term for Student Loans.

So... let's add up everything we are responsible for to pay.  We must payor EFC which is $10,000 + we must pay the Un-Met Need which is $7,500 + we eventually have to pay our Student Loans, which amount to $3,750.  So... in order for usto attend College A, we are going to have to pay $17,500 up front... and we are going to have $3,750 in Student Loans.

Now... let's look at the good news!  There are Colleges that will be much more affordable, and you may not have to come up with any money up front to go there.  You may be able to take out Student Loans, which by the way, are now guaranteed by the Government, so you may not need a co-signer.

College B is $55,000 per year.  You've contacted a professional College Planning Company, like www.CollegeFundingConnection.org, and they have help you reduce your EFC down to $0.  College B cost $55,000 - your EFC of $0... means you qualify for $55,000 worth of "Need Based" Financial Aid.  College B participates in Financial Aid at 100%!  This means that there is no "Un-Met Need"... they are going to give you $55,000 in Financial Aid.  College B, splits their Financial Aid up at 84% in Free Money... and 16% in Loans.  You can do the math... but you are getting 84% in money that never has to be paid back... and you are getting 16% in student loans... which are due 6 months after you graduate...

So - do some home work, or contact a professional College Planning organization, and let them go to work and make this whole thing affordable for you!  Remember this one decision you are about to make - is not a 4-year decision... it could affect your life for the next 40 years... so choose wisely - and all the best to you.  I hope this helps.