Demystifying college financial aid

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For many, paying for college can be a challenge. However, there are many types of loans, grants and scholarships available to students on a college and federal level.

Free Application for Federal Student Aid

Students must apply for a FAFSA before applying for any type of federal college financial aid. Many states and colleges also use FAFSA for determining aid.

  • 2017-18 FAFSA Deadlines: There are college, state and federal deadlines for FAFSA, and all are at different times spanning two years. Students are encouraged to apply as early as possible to have the greatest chance of receiving a loan because they are awarded on a first-come, first-served basis.
  • College deadline: Varies according to college
  • Federal deadline: June 30, 2018. Although the federal aid deadline for the 2017-18 year is not until June 2018, students are encouraged to submit applications as early in the school year as possible.

Federal grant and loan programs available

  • Federal Pell Grant: Awarded to undergraduate students who demonstrate exceptional financial need.
  • Subsidized loans: The U.S. Department of Education pays the interest on a loan for undergraduate students with financial need while students are in school at least half-time and during a period of deferment for the first six months after leaving college or graduating.
  • Unsubsidized loans: The student is responsible for paying the interest; interest accumulates if the student chooses not to pay the interest while in school.

Where to find scholarships and grants

Scholarships are available through service organizations, school districts, businesses and colleges.

5 FAFSA application tips

Katy-area FAFSA tutor Chis Liebum and HCC financial coach Dominique Brown recommend the following tips for a successful FAFSA application.

  1. Start early. The application opens in October, so start early to allow time for correcting mistakes.
  2. Use the correct tax information. Parents can use tax information from two years prior instead of having to wait until they file for the current year.
  3. Be aware of deadlines. College and university deadlines may differ from the state and federal deadlines. Scholarships and work-study often run out early, so apply as soon as possible.
  4. Don’t count yourself out. Some parents think their income is too high to qualify for aid, but merit-based scholarships also require the FAFSA and any student who fills out the FAFSA will qualify for some type of financial aid.
  5. Fill out the forms together. Some students file the FAFSA application without their parents’ assistance, but this can lead to miscommunication that may reduce aid by thousands of dollars.

Glossary of financial aid types

  • Private loan: nonfederal loan made by private lender, including a bank or credit union; terms and conditions are set by the lender
  • Federal student loan: allows students and their parents to borrow money to pay for college or career school; this money must be paid back with interest
  • Grant: financial aid that does not need to be repaid
  • Scholarship: financial aid awarded for academic or other achievements; does not need to be repaid
  • Qualified tuition plans (529 plan): tax-advantaged savings plan designed to encourage saving for college

How do I calculate what I will owe on student loans?

Online calculators can be used to calculate loan balance using a student’s loan amount, interest rate and income. The U.S. Department of Education’s Office of Student Aid offers one such calculator.

  • Visit www.studentloans.gov
  • Click the “Repayment & consolidation” tab
  • Click the “Use the repayment estimator” link to find the estimator tool

Loan forgiveness Program

The Public Service Loan Forgiveness Program forgives the remaining loan balance after a graduate makes 120 qualifying monthly payments while working full-time for a qualifying employer.

Teacher loan forgiveness forgives certain types of loans if graduates teach for five academic years.

Local Katy-area resources

Dominique Brown is one of six financial coaches in the Houston Community College system. Contact her at Dominique.brown@hccs.edu.

Katy ISD hosts annual financial aid seminars, including a Financial Information Academy held in February. Contact the district for information on seminars.

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Cassidy Ritter

Cassidy graduated from the University of Kansas in 2016 with a degree in Journalism and a double minor in business and global studies. She has worked as a reporter and editor for publications in Kansas, Colorado and Australia. She was hired as senior reporter for Community Impact Newspaper's Plano edition in August 2016. Less than a year later, she took the role of editor for the McKinney edition.

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