Pell Grant Consultant: Business Idea Forum

[aspiring0L]

I wanted to run an idea by Top Law School posters for a consultancy I would head up either during law school or forgoing law school period. It concerns Pell Grants.

You can enroll at a community college if you qualify for Pell Grants, and sign up for the bare minimum of classes. After about 6 weeks, the surplus funds are released to the student (the idea being extra Pell Grant money would cover books). This is considered an unofficial holiday at many community colleges called "Check Day." Many of the students will never be seen again. The surplus funds can easily add up to enough for a down payment for a car or multiple months of rent.

Pell grant max plus NY state TAP equals ~$12,560 per year. Community college tuition in NYC is $4,800/year (4-year CUNY is $6,930). That's a lot of leftover money to spend. If the tuition is so low that the Pell grant actually exceeds the amount the school is owed, which is common at community colleges, you receive the difference in cash.

The Pell Grant-tuition spread is like the earned income tax credit, where taxes have a similar distinction between nonrefundable credits and refundable credits. EITC is a refundable credit, so if you get so much EITC that your income tax becomes a negative number, you get the difference back in cash. It's a refundable credit. And of course there's lots of EITC "spread" too for the same reason: it's possible for someone who paid no income taxes at all to get a "refund" thanks to the refundable credit.

My proposal is to identify students who do not plan on going to college, "consult" with them to enroll them in an appropriate community college, then take a percentage of the Pell Grant-tuition spread (between 20-50%). I would help them with enrollment, financial documentation, and clearing the "spread" to the proper bank account type. With a couple dozen students a year I could reasonably cover all my living expenses. With about 100 I would begin saving and building a nest egg. It is a pretty low-effort business and could be built up based on referrals.

[Wanderingdrock]

Begone, troll.

[aspiring0L]

Begone, troll.

?

[Wanderingdrock]

Begone, troll.

?

I don't intend to continue responding after this, but in case any actual 0Ls come along and wonder:

This is so obviously illegal that it isn't even my practice area but I can think of, like, 5 different federal felonies you would easily be convicted of if you embarked on anything anywhere close to what you describe.

[aspiring0L]

Begone, troll.

?

I don't intend to continue responding after this, but in case any actual 0Ls come along and wonder:

This is so obviously illegal that it isn't even my practice area but I can think of, like, 5 different federal felonies you would easily be convicted of if you embarked on anything anywhere close to what you describe.

Can you name two?

I am helping young people find good educational options and taking a fee that is on a percentage basis as opposed to fixed like most educational consultants.