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Discuss various money matters here. Loans (federal and private), scholarships, lottery winnings, or other school finance related information and queries.
saladfiend
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Blah

Postby saladfiend » Tue Mar 02, 2010 10:04 am

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Last edited by saladfiend on Mon Jun 20, 2011 11:23 pm, edited 1 time in total.

AsylumPB
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Re: EFC greater than cost of attendance

Postby AsylumPB » Tue Mar 02, 2010 10:22 am

why would you even need to take ot loans if your efc is that high?

Flanker1067
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Re: EFC greater than cost of attendance

Postby Flanker1067 » Tue Mar 02, 2010 10:24 am

AsylumPB wrote:why would you even need to take ot loans if your efc is that high?


Why are you answering a question with a question? What are you, a law student?

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TheBigMediocre
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Re: EFC greater than cost of attendance

Postby TheBigMediocre » Tue Mar 02, 2010 10:28 am

AsylumPB wrote:why would you even need to take ot loans if your efc is that high?

Quick google search on a subsidized stafford loan: "A need-based loan. Interest is paid by the federal government while the borrower is enrolled in school at least halftime."

You'd want to take out the subsidized loan because the gov't is paying off your interest expense, so your family can invest the money in more profitable endeavors instead of your law school expenses. Then at the end of the three years your family just pays the entire thing off before you assume any interest expense.

Voila!
Last edited by TheBigMediocre on Tue Mar 02, 2010 10:30 am, edited 2 times in total.

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vanwinkle
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Re: EFC greater than cost of attendance

Postby vanwinkle » Tue Mar 02, 2010 10:28 am

Flanker1067 wrote:
AsylumPB wrote:why would you even need to take ot loans if your efc is that high?

Why are you answering a question with a question? What are you, a law student?

Bahahahahaha, +1.

To address OP's question, I'm not sure where the line is regarding qualifying for subsidized loans. However, something to keep in mind is that even if you do qualify, they're limited to $8,500 per year, and the rest will have to be in unsubsidized Stafford or GradPLUS loans. If you're like many students and paying for the whole thing on loans, that's going to be $25,500 out of $180,000 total, so the loss of that subsidy won't hurt you too much, you're mostly in the realm of unsubsidized loans anyway.

Anonymous Loser
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Re: EFC greater than cost of attendance

Postby Anonymous Loser » Tue Mar 02, 2010 10:30 am

My EFC 1L year was a number that was close to the COA, yet I received the full amount of subsidized Stafford loans, and even qualified for several thousand dollars in Perkins loan funding.

What gave you the idea that an EFC in excess of the COA would prevent you from receiving subsidized loans? The way your EFC factors into financial aid eligibility is more complex that simply COA-EFC=Aid Package, so drawing conclusions about your eligibility based solely on your EFC is not likely to result in an accurate picture of your eligibility for subsidized loans.

eudaimondaimon
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Re: EFC greater than cost of attendance

Postby eudaimondaimon » Tue Mar 02, 2010 10:36 am

AsylumPB wrote:why would you even need to take ot loans if your efc is that high?


It's called the Expected Family Contribution, not the Guaranteed Family Contribution.

Some students' families do not wish to pay for law school for them, even though their families are well-off.

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Sauer Grapes
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Re: EFC greater than cost of attendance

Postby Sauer Grapes » Tue Mar 02, 2010 10:37 am

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Sauer Grapes
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Re: EFC greater than cost of attendance

Postby Sauer Grapes » Tue Mar 02, 2010 10:39 am

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Anonymous Loser
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Re: EFC greater than cost of attendance

Postby Anonymous Loser » Tue Mar 02, 2010 10:54 am

I'll poke around for a link later, but the main thing is that your EFC should be thought of not as a dollar amount, but as an index score, despite the fact that the DOE calls it your "Expected Family Contribution."

While your EFC is compared to your COA, your EFC is primarily used to compare your financial need to the financial need of other students: thus, an EFC that is high relative to the COA is not per se determinative of your eligibility for subsidized loans. Moreover, this calculation compares students within institutions as well as across the entire financial aid spectrum, so you are, in essence, being compared with other similarly situated law students, many of whom have worked for the prior year, resulting in a high EFC. Think of EFC as something like a FICO score, not a dollar amount--it's just an abstraction.

As Van Winkle noted above, we're only talking about ~3 years worth of interest on $25,000: over the life of your loans, the difference between receiving the full amount of subsidized loans and receiving no subsidized loans is not much more than $6,000.

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vanwinkle
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Re: EFC greater than cost of attendance

Postby vanwinkle » Tue Mar 02, 2010 11:01 am

Sauer Grapes wrote:For instance, let's say, for example I have an EFC or $45K. School costs $43K and I have a scholarship of $41K. Let's say living expenses are estimated at $15K. I'd only be paying $17K for school and living. Would I be able to borrow that $17K in subsidized loans?

As I mentioned earlier, subsidized Stafford loans are capped at a maximum of $8,500 per year, no matter what your EFC is. There is no way to borrow $17K in unsubsidized loans in one year.

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Sauer Grapes
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Re: EFC greater than cost of attendance

Postby Sauer Grapes » Tue Mar 02, 2010 11:02 am

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Sauer Grapes
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Re: EFC greater than cost of attendance

Postby Sauer Grapes » Tue Mar 02, 2010 11:05 am

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Last edited by Sauer Grapes on Mon Aug 23, 2010 12:10 am, edited 1 time in total.

AsylumPB
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Re: EFC greater than cost of attendance

Postby AsylumPB » Tue Mar 02, 2010 11:12 am

TheBigMediocre wrote:
AsylumPB wrote:why would you even need to take ot loans if your efc is that high?

Quick google search on a subsidized stafford loan: "A need-based loan. Interest is paid by the federal government while the borrower is enrolled in school at least halftime."

You'd want to take out the subsidized loan because the gov't is paying off your interest expense, so your family can invest the money in more profitable endeavors instead of your law school expenses. Then at the end of the three years your family just pays the entire thing off before you assume any interest expense.

Voila!


That is assumming that the market gets better and that those investments actually make money. There is always a risk with investing that much money that you will lose it. the market is still very flimsy and there is a chance that OP's family might not even have that money in a few years if they were to invest it. I was just saying that if OP's family is well enough off to pay for COA up front, why not go ahead and do it? Of course, this is assumming that they are willing to help out.

flowylime
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Re: EFC greater than cost of attendance

Postby flowylime » Tue Mar 02, 2010 3:54 pm

Anonymous Loser wrote:What gave you the idea that an EFC in excess of the COA would prevent you from receiving subsidized loans? The way your EFC factors into financial aid eligibility is more complex that simply COA-EFC=Aid Package, so drawing conclusions about your eligibility based solely on your EFC is not likely to result in an accurate picture of your eligibility for subsidized loans.



Actually, the amount of subsidized loan eligibility is entirely dependent on the cost of attendance - expected family contribution = need based aid eligibility formula. This is the case for any type of federal aid eligibility.

So for example, let's say your EFC was $25,000 and the COA of your school of choice was $55,000. Your eligibility for need-based aid (including subsidized and perkins loans) would be $55k - $25k = $30k. In this case, you would be definitely eligible for the maximum $8,500 in subsidized stafford, and $12,000 in unsub stafford.

Edited for spelling.

saladfiend
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Re: EFC greater than cost of attendance

Postby saladfiend » Tue Mar 02, 2010 9:21 pm

Who is right--Anonymous Loser or flowylime?

flowylime
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Re: EFC greater than cost of attendance

Postby flowylime » Wed Mar 03, 2010 9:59 am

I'm a financial aid counselor, if that adds to my street cred.

Flanker1067
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Re: EFC greater than cost of attendance

Postby Flanker1067 » Wed Mar 03, 2010 10:05 am

That is a good question... Anonymous loser definately talks a good game, but flowylime has credentials. This is like election '08.

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Sauer Grapes
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Re: EFC greater than cost of attendance

Postby Sauer Grapes » Wed Mar 03, 2010 10:08 am

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Last edited by Sauer Grapes on Mon Aug 23, 2010 12:11 am, edited 1 time in total.

Flanker1067
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Re: EFC greater than cost of attendance

Postby Flanker1067 » Wed Mar 03, 2010 10:10 am

Sauer Grapes wrote:
Flanker1067 wrote:That is a good question... Anonymous loser definately talks a good game, but flowylime has credentials. This is like election '08.

So you are saying A.L will win this debate?


Probably, but flowylime might be right in the end.

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Sauer Grapes
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Re: EFC greater than cost of attendance

Postby Sauer Grapes » Wed Mar 03, 2010 11:02 am

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Last edited by Sauer Grapes on Mon Aug 23, 2010 12:11 am, edited 1 time in total.

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blurbz
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Re: EFC greater than cost of attendance

Postby blurbz » Wed Mar 03, 2010 11:04 am

While I love the track this has gone off on, I'm confused: I have a $0 EFC because law students don't need to list their parental information. Why would anyone list parental information if they don't have to?

Flanker1067
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Re: EFC greater than cost of attendance

Postby Flanker1067 » Wed Mar 03, 2010 11:05 am

Sauer Grapes wrote:
Flanker1067 wrote:
Sauer Grapes wrote:
Flanker1067 wrote:That is a good question... Anonymous loser definately talks a good game, but flowylime has credentials. This is like election '08.

So you are saying A.L will win this debate?


Probably, but flowylime might be right in the end.

By then it might be too late. We'll all be screwed financially. :lol:


Ha, not me, my EFC is 0. It's likely the poor will still be poor no matter what happens. Any chance you are going to end up at Duke? I am leaning that way right now...

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danquayle
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Re: EFC greater than cost of attendance

Postby danquayle » Wed Mar 03, 2010 11:14 am

flowlylime is right.

However, its worth nothing that the default EFC for law students is zero , so unless you decide to answer questions about your parents income, you shouldn't have a problem getting the max amount in stafford loans... should you want them. EFC should be irrelevant.

Rawlsian
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Re: EFC greater than cost of attendance

Postby Rawlsian » Wed Mar 03, 2010 11:19 am

blurbz wrote:While I love the track this has gone off on, I'm confused: I have a $0 EFC because law students don't need to list their parental information. Why would anyone list parental information if they don't have to?


Some schools require you too up to the age of 25. And of course, almost every school requiring need access requires parent's information up to the age of 29.




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