Award letter questions? Visit College Financing 101: Smart Options for Your Child’s College Financing Presented by: Steve Wynne Account Executive – Client Relations and Education Presented by: Ben Carey Director | Strategic Partnerships

Award letter questions? Visit Definitions Types of Financial Aid Listed – Scholarships and Grants – Federal Work Study Program – Federal Perkins Loan – Federal Direct Loans – Federal Direct PLUS Loan Agenda Your Award Letter How Much Do I Really Need Appealing an Award Letter Loan Options 2 Credit Union Student Choice © 2013

Award letter questions? Visit Definitions 3 Credit Union Student Choice © 2013 Award Letter – also referred to as a financial aid package, contains the cost of attendance and any financial aid offered to the student by the school. Cost of Attendance (C.O.A.) – the cost set by the school to cover student expenses. Includes tuition, fees, books, rent, food, misc. expenses, etc.. Financial Aid – the offering of scholarships, grants, federal work study, and loans to assist a student in meeting the cost of attendance. – COA – EFC = Need – Offered Financial Aid = GAP!

Award letter questions? Visit Types of Financial Aid 4 Credit Union Student Choice © 2013 Scholarships and Grants Federal Work Study Federal Perkins Loan Federal Direct Loans – Subsidized – Unsubsidized Federal Direct PLUS Loans

Award letter questions? Visit Free money from the government, state, and/or institution Does not have to be repaid Grants may have an obligation associated with acceptance. Failure to meet obligation may require grant to be repaid. Awarded based on need or merit Awarded for a variety of reasons: – Academics, sports, extra-curricular activities, etc. Check with the Financial Aid Office for additional scholarships that may be available. 5 Credit Union Student Choice © 2013 Scholarships and Grants

Award letter questions? Visit Verify Are you willing to meet the requirements attached to receiving this aid? Is the scholarship/grant renewable; not just made available for one year, but aid that will be carried over year after year? Compare award letters; different schools will award varying amounts of aid, compare the dollars award to make the right choice for student and family. 6 Credit Union Student Choice © 2013 Scholarships and Grants

Award letter questions? Visit Federal Work Study 7 Credit Union Student Choice © 2013 Free money – kind of! First come – First serve – Financial Need Provides jobs to student with financial need Paid at least minimum wage Jobs are part time, usually on-campus Didn’t receive Work Study? Check with the Financial Aid or Admissions Offices

Award letter questions? Visit Loan is in the student’s name, made through the school’s financial aid office Awarded to students with exceptional financial need Maximum annual amount is $5.500 Government pays interest while in school Federal Perkins Loan Fixed interest rate of 5% no origination fee Once in repayment, pay school directly Standard repayment term is 10 years Grace period is 9 months 8 Credit Union Student Choice © 2013

Award letter questions? Visit William D. Ford Federal Direct Loan Program Loans are in the students name and funds come directly from the U.S. Department of Education Standard repayment term is 10 years with a 6 month grace period 9 Credit Union Student Choice © 2013 Federal Direct Loans

Award letter questions? Visit Subsidized Awarded to eligible students based on financial need Government pays interest while in school Fixed interest rate of 3.86% plus 1.051% loan fee* Unsubsidized Awarded to all eligible students, not based on need Students are responsible for interest, may defer Fixed interest rate of 3.86% plus 1.051% loan fee* Federal Direct Loans 10 Credit Union Student Choice © 2013 *First Disbursed between July 1, 2013 and June 30, 2014

Award letter questions? Visit YOUR AWARD LETTER 11 Credit Union Student Choice © 2013

Award letter questions? Visit 12 Credit Union Student Choice © 2013 Award Letter Types By Mail By System By

Award letter questions? Visit Award Letter Example 13 Credit Union Student Choice © 2013 Federal Loan – Subsidized $3,500 Federal Loan – Unsubsidized $2,000 School Grant $1,500 State Scholarship$1,000 Federal Work-Study $2,000 Total Award $10,000 Cost of Attendance $20,138 Remaining Need$10,138 University of Success

Award letter questions? Visit Reports in the media of a widespread student debt crisis might be discouraging to someone considering financing a college education In reality, instances of students with excessive debt are rare: – 43.1% of students have $10K or less in student loan debt – 4.2% of students have debt between $75K and $150K – 1.2% have debt over $150K Indebted Students, by Amount Owed Federal Reserve Bank of New York statistics, as cited in The Myth of the Student Loan Crisis, Atlantic Magazine, March Credit Union Student Choice © 2013 Student Indebtedness

Award letter questions? Visit How Much do you Really Need? 15 Credit Union Student Choice © 2013 Consider: Fixed Costs Flexible Costs Other Income Appeals

Award letter questions? Visit Fixed Costs Tuition$8,000 + School Fees$1,000 Total Fixed $9, Credit Union Student Choice © 2013

Award letter questions? Visit Flexible Costs Rent – ($400 X 10) $4,000 Food – ($300 X 10 months)$3,000 Books - ($100 X 10 books)$1,000 Cell Phone - ($50 X 10 months)$500 Transportation - (ex: Bus $25/mo x 10mos.) $ Total Flexible $8, Credit Union Student Choice © 2013

Award letter questions? Visit Unmet Need Fixed$9,000 Flexible $8,750 Total Costs$17,750 Total Award ($10,000) Remaining Need$7,750 Need reduced by $2,388 (or $238 a month) 18 Credit Union Student Choice © 2013

Award letter questions? Visit Monthly Budget 19 Credit Union Student Choice © 2013 $7,750 needed over a 10 month period – $775 month Consider other income before borrowing – Part time job – Assistance from family members/friends Consider school payment plans – School may offer a monthly payment plan for a small fee

Award letter questions? Visit Appealing your Award Letter 20 Credit Union Student Choice © 2013 Reasons to appeal: Change in employment/income Medical bills Divorce Disability/death High consumer debt

Award letter questions? Visit Appealing your Award Letter 21 Credit Union Student Choice © 2013 Each school will have their own process and procedures. Visit the school’s website for specific instructions on how to appeal. – Submit a letter – Appointment with FAO – Telephone interview

Award letter questions? Visit Remaining Need 22 Credit Union Student Choice © 2013 Savings Account Retirement Account 401K Plans Home Equity Loans Credit Cards Private Loan Options

Award letter questions? Visit Federal Direct PLUS Loan 23 Credit Union Student Choice © 2013 Often listed on Award Letter Interest rate is fixed at 6.41% Bridges the gap between education costs and financial aid Credit based loan made to the biological, adoptive, or in some cases a step-parent of a dependent student for the purpose of meeting the cost of attendance. Origination fee of 4.204%

Award letter questions? Visit Federal Direct PLUS Loan 24 Credit Union Student Choice © 2013 Limit is the COA less any other Financial Aid Payments begin 60 days after first date of disbursement (can request deferment) No prepayment penalty Dependent students whose parent is denied may qualify for additional Federal Direct Loan limits

Award letter questions? Visit Rate Index – Prime or LIBOR (difference of about 3%) Margin - % added to index Floor – Never go below Fees Origination Fee – 0% to 3% Repayment Terms 10 to 25 years Private Loan Options 25 Credit Union Student Choice © 2013 Borrower Benefits What’s in it for me? (W.I.F.M.) Co-Borrower Options FICO, Debt to Income ratio Payment Options Full deferment Principal & Interest Good Faith Payments What to Consider:

Award letter questions? Visit The Student Choice Solution Offered at NASA Federal Credit Union Can borrow up to $75,000 for an undergraduate degree Nearly 2,000 4-year, not-for-profit public and private colleges and universities who participate in the federal student aid programs – known as Title IV. 26 Credit Union Student Choice © 2014

Award letter questions? Visit The Student Choice Solution Low Interest Rates (Based on LIBOR Index + Spread) – Floor 6% – Ceiling 18% NO origination or prepayment fees 20 or 25 year repayment (>< $40K) with max of $75,000 Full deferment available Graduated Repayment 0.25% rate discount for automatic repayment (ACH) 27 Credit Union Student Choice © 2014

Award letter questions? Visit Forbearance Bankruptcy Death Economic hardship Natural disaster Late notification from school Military mobilization Flexible Repayment Options Full deferment (maximum 5 years + 6 month grace) Interest only Principal & Interest Graduated repayment available The Student Choice Solution 28 Credit Union Student Choice © 2014

Award letter questions? Visit Your Education/Application Web Site 29 Credit Union Student Choice © 2014 To Apply Applicants Visit: or call (866)

Award letter questions? Visit Please contact us with any additional questions. Charlie Hudson Business Development Account Representative (888) Ext For more information or for any additional assistance in planning your college career visit: You can also send questions to Thank You for Attending 30 Credit Union Student Choice © 2014