COLORADO MOUNTAIN COLLEGE FINANCIAL AID GUIDE

Transcription

1 COLORADO MOUNTAIN COLLEGE FINANCIAL AID GUIDE

2 Caution: Some information in this guide may change as the U.S. Dept. of Education continues to issue new regulations in Stay in contact with the Office of Financial Aid. Applying for financial aid & the need analysis process Your Complete FAFSA on the Web as soon after January 1 as possible. The priority date for applying for financial assistance for the academic year is March 31, A Personal Identification Number (PIN) will be issued to you when you complete the FAFSA and will serve as your signature. If you are a dependent, your parent will also be assigned a PIN. Check with CMC to determine whether there are any other forms you should complete. Within 5 to 7 days the Department of Education will send to you a Student Aid Report (SAR), which includes your Expected Family Contribution. If you provide your address, you ll receive an with a link to your online SAR. financial aid office will use the information received from the processing agent to construct your Financial Aid Package. This package will be explained in the Award Notification you receive. You must respond to the Award Notification immediately to notify CMC (through web advisor) that you accept all, part, or none of the Financial Aid Package offered. If scholarships and grants are not sufficient to cover your expenses, a loan may fill your remaining financial need. If you indicated on the FAFSA that you would accept a loan, the Direct Loan amount for which you are eligible will be included as part of your Financial Aid Package. In addition, you may use Federal Unsubsidized or PLUS Loans for part or all of your Expected Family Contribution. Need analysis determines your eligibility for financial aid. You must submit this form to be considered for most state-funded aid. If you are an undergraduate, federal law requires that your eligibility or ineligibility for a Pell Grant be determined before you can be considered for a loan. IMPORTANT: Complete all other financial aid application forms that your college may require. To prevent delays in processing your application, promptly provide any information or verification of income and expense data that your financial aid office may request. Sometimes the application process does not reflect a family s real situation due to special circumstances such as death, divorce or separation, disability, loss of employment, natural disasters, etc. In such a case, CMC s financial aid officer may use his/her professional judgment so that the student s aid package will reflect the family s real situation. What information is requested from you and your parents? 2 Sometimes students and parents are surprised or dismayed when they are asked to furnish personal financial information to obtain financial aid. Please understand that most or all of the data is sought from you to meet requirements of the federal government and to insure that the financial aid programs are administered fairly to all students. The federal need analysis formula utilizes information about your family s income, assets, benefits, and exemptions to determine how much (if any) discretionary income the family should contribute to educational expenses. In order to fill out the FAFSA, you will need: 4 your Social Security Number 4 your driver s license 4 W-2 forms or other records of money earned 4 your federal income tax return (If you haven t yet filed your taxes, you may estimate amounts, but you must correct any discre ancies once you have definitive numbers from your tax return.) 4 your parents federal income tax return (if you are a dependent student) 4 your untaxed income records (Social Security, Temporary Assistance to Needy Families (TANF), welfare benefits, veterans benefits) 4 current bank statements 4 current information about any business or investment mortgages, and farm, business, stock, bond, and other investment records 4 your alien registration number or permanent resident card, if you are not a U.S. citizen Every year the U.S. Department of Education pulls a certain percentage of applications for a verification process. If you are selected for verification, you will be required to furnish documentation for the information you entered on the FAFSA. Be sure to keep copies of all forms, tax returns, etc, that you used as references when filling out your application. Paying for your college education COST OF ATTENDANCE Tuition & Fees Room & Board Books & Supplies Transportation Personal & Misc. Paid for BY } NOTE: Because the cost of attendance varies for each school, your financial need can differ, depending on the college you attend. FAMILY CONTRIBUTION FINANCIAL AID PACKAGE Pell Grant State Aid SEOG Work Study Direct Loans Private Scholarships etc. Supplemented, if necessary, by Direct Unsubsidized Loans or Direct PLUS Loans. Based on income, assets, expenses, size of family, age of parents, number of working parents, number of students in college, extraordinary circumstances. A combination of these will make up your financial aid package.

3 Important terms Need Analysis A FAFSA (fafsa.ed.gov) is completed by the student (and parents). It is used to determine how much they are expected to contribute towards the cost of education. This form is analyzed and the results are sent to you and the school you indicate. This form must be completed in order to receive most types of financial aid. Student Aid Report The results of a need analysis which are used in calculating the types and amounts of aid. Cost of Education Also referred to as Cost of Attendance. This is the total amount it will cost a student to go to school. It usually is expressed as a total for a nine-month academic year. Expected Family Contribution (EFC) The amount of money the parents and the student combined are expected to contribute toward the cost of education during a school year. The federal government believes that the student and family are primarily responsible for financing the student s education. It may be possible to borrow an Unsubsidized Stafford or PLUS Loan to assist in meeting this contribution. Financial Aid Award Package An offer to the student from the school s financial aid office. It contains various types of aid to pay for the cost of education. Grant A type of financial aid that does not have to be repaid. Scholarship A type of financial assistance which does not have to be repaid. Funds are provided by a variety of civic organizations, professional groups, etc. and by colleges. Scholarships are based on academic excellence, personal skills, family affiliations, athletic ability, etc. Direct Student/Parent Loans Funds lent under these programs are provided by the federal government. There are three types: Federal Direct Loans (subsidized), Federal Direct Loans (unsubsidized) and Federal Direct PLUS Loans (for parents). Alternative Loan A private, credit-based loan designed to assist with funding needs that Federal loans don t cover. 3 Colorado Mountain College Costs The student expense budget reflects a reasonable cost of attendance at CMC for an academic year (nine months). If attendance is less than or greater than nine months, the budget components will be prorated accordingly. Actual expenses may vary depending on your living arrangements, priorities and personal obligations. Tuition and Fees: average charges for basic instructional costs and mandatory fees. Actual fees paid may vary based on the number of credits and or types of classes carried each semester. Living Expenses: an average amount for housing and food charges, medical, laundry, toiletries, clothing, local transportation, entertainment, etc. for students living on or off campus. Books and Supplies: an average amount expended for books and supplies. Dependency Status The maximum amount you may borrow in Direct Loans depends on whether you are an independent student or dependent student, as well as your academic year in school. You re automatically considered INDEPENDENT if you 4Were born before January Are serving on active duty in the U.S.Armed Forces 4Since turning 13, both parents are deceased 4Are a dependent or ward of the court since turning are 13 4Are Married 4Are a veteran of the U.S. Armed Forces 4Were in foster care since turning age 13 4Are currently or have been an emancipated minor Transportation a modest allowance for non-local transportation, such as trips from campus to home. Personal Computer: if student can provide documented cost it can be included in expense budget. Average Cost of Attendance* Academic Year (9 months) Budget Category Resident Non- Resident Living w/ Parent Tuition and Fees* 2,640 2,860 1,650 Living Expenses ,200 Books and Supplies 1,200 1,200 1,200 Transportation Insurance Total Estimated Cost 14,940 20,160 10,150 * These costs are for the academic year. Cost for will increase. These costs are based on full-time enrollment. 4Have children and provide more than half of their support 4Will be working on a master s or doctorate program 4Have dependents (other than children or a spouse) who live with you and you provide more than half of their support 4Are currently or have been in legal guardianship 4Are homeless or at risk of being homeless The range of personal situations is extensive. If you feel your dependency status is not accurately reflected by these definitions, discuss your personal situation with the financial aid office. If your dependency status changes at any time during the year, you must notify the financial aid office immediately. Independent students do not include their parents financial information on the FAFSA.

4 Estimating Expected Family Contribution and eligibility for student aid The Department of Education uses information from your FAFSA to perform a need analysis and determine your Expected Family Contribution (EFC). Your school then subtracts the EFC from their Cost of Attendance (COA) to calculate the amount of need-based financial aid you are eligible to receive. Each school to which you apply will assemble a financial aid package and send you an award letter outlining the types and amounts of aid available to you. You may accept all, part, or none of a school s financial aid package. To get an early estimate of your EFC and aid eligibility prior to the official need analysis process, take advantage of the Department of Education s FAFSA4caster at Using information you provide about the type of school you plan to attend, FAFSA4caster can even estimate award amounts for specific kinds of aid, such as grants, loans, and work-study. When the time comes to fill out the FAFSA, you can use your answers on the FAF- SA4caster to prefill many of the FAFSA questions. You may also want to check out Finaid: The SmartStudent Guide to Financial Aid ( which provides an Expected Family Contribution Calculator ( The website offers a detailed analysis calculator, as well as a Quick EFC Calculator. Other kinds of aid, such as scholarships and grants, may be given by schools, organizations, companies, etc. Some grants are based on need, while others are based on academic or athletic ability, career interests, religious affiliation, membership, location, employment, etc. Investigate these opportunities at your school, library, or on the internet at Finaid ( Scholarships offered through CMC are linked from the online catalog: 4 Federal Financial Aid Eligibility Requirements Eligibility Demonstrate financial need High school diploma or GED certificate or pass a test approved by the U.S. Department of State Pell FSEOG FWS Perkins Subsidized UnSubsidized PLUS Enrolled/accepted at an eligible school Enrolled/accepted in an eligible degree or certificate program U.S. citizen or eligible non-citizen a Valid Social Security number a Make satisfactory academic progress, as determined by the school Sign statement of educational purpose (on FAFSA) Sign statement that you are not in default on a federal student loan and do not owe money back on a federal student grant (on FAFSA) a Registered with the Selective Service, if required Not convicted of possessing/selling drugs while receiving federal financial aid a) Both the parent borrower and the student on whose behalf he/she is borrowing must meet eligibility requirements. Federal Direct Student Loans Direct Loans (DL) are low-interest loans for students and parents to help pay for the cost of a student s education after high school. The lender is the U.S. Department of Education (the Department) rather than a bank or other financial institution. With Direct Loans, you 4Borrow directly from the federal government and have a single contact-the Direct Loan Servicing Center for everything related to the repayment of your loans, even if you receive Direct Loans at different schools. 4Have online access to your Direct Loan account information 24 hours a day, 7 days a week at Direct Loans on the Web at: 4Can choose from several repayment plans that are designed to meet the needs of almost any borrower, and you can switch repayment plans if your needs change. Applying for Direct Loans Applying for aid As with all federal student aid, you apply for Direct Loans by filling out the Free Application for Federal Student Aid (FAFSA). Most students use FAFSA on the Web to complete their applications. The information on your FAFSA is transmitted to the schools that you list on the application, and those schools use the information to assess your financial need for student aid. The award package Direct Loans are generally awarded as part of a larger award package, which may contain other types of aid as well, to help you meet the costs of going to college. The Direct Loan Program offers the following types of loans: 4Subsidized: for students with demonstrated financial need, as determined by federal regulations. No interest is charged while a student is in school at least half-time, during the grace period, and during deferment periods.

5 5 4Unsubsidized: not based on financial need; interest is charged during all periods, even during the time a student is in school and during grace and deferment periods. 4PLUS: unsubsidized loans for the parents of dependent students and for graduate/professional students. PLUS loans help pay for education expenses up to the cost of attendance minus all other financial assistance. Interest is charged during all periods. 4Consolidation: Eligible federal student loans can be combined into one Direct Consolidation Loan. Student borrowers are not required to begin making payments until after they drop below half-time attendance. CMC will tell you how much you may borrow and the types of loans you are eligible to receive. Note: PLUS loan borrowers cannot have an adverse credit history (a credit check will be done). Accepting a loan CMC will notify you of the loan amounts in an e-award notification that lists all of your proposed financial aid awards (your award package). You will be directed to WebAdvisor to accept your awards. You should evaluate the aid offer carefully. In the case of loans, keep in mind that whatever amount you borrow must be paid back with interest. If your living expenses are not as high as the standard allowance projected by your school, you may not have to borrow as much as the amount in the award letter. You have the right to decline the loan or to request a lower loan amount. Interest rates 4Direct Subsidized Loans for undergraduates with a first disbursement date between July 1, 2011, and June 30, 2012: 3.4% 4Direct Unsubsidized Loans for all students: 6.8% 4Direct PLUS Loans: 7.9% Entrance counseling Except for Direct PLUS Loan borrowers, if you haven t previously received a Direct Loan, you must complete entrance counseling before CMC can make the first disbursement of your loan. This helps you to understand your responsibilities regarding your loan. You may complete this counseling online. The Master Promissory Note To take out a Direct Loan for the first time, you must complete a Master Promissory Note (MPN). The MPN will be provided by the Department. CMC offers the option of completing the MPN electronically, you can complete the MPN online at the Direct Loans Master Promissory Note website. The MPN is a legal document in which you promise to repay your loan(s) and any accrued interest and fees to the Department. It also explains the terms and conditions of your loan(s). To complete an MPN online, you will be required to use your Department of Education-issued PIN. If you do not have a PIN, you may request one from the official PIN site. A parent borrower must also request a PIN number from the PIN site to use when completing a PLUS MPN. In most cases, once you ve submitted the MPN and it s been accepted, you won t have to fill out a new MPN for future loans you receive. You can borrow additional Direct Loans on a single MPN for up to 10 years. You ll receive a disclosure statement that gives you specific information about any loan that CMC plans to disburse under your MPN, including the loan amount, fees, and the expected disbursement dates and amounts. How the loans are disbursed (paid out) Generally, your loan will cover a full academic year and your school will make at least two disbursements to you, for example, at the beginning of each semester. In most cases CMC will disburse your loan money by crediting it to your school account to pay (tuition and fees, room and board, and other authorized charges). If the loan disbursement amount exceeds your school charges, CMC will pay you the remaining balance of the disbursement directly by check or other means. Using the loan for education expenses: You may use the loan money you receive only to pay for your education expenses. Education expenses include school charges such as tuition, room and board, fees and indirect expenses such as books, supplies, equipment, dependent child care expenses, transportation and rental or purchase of a personal computer. Paying interest while in school You may choose to pay interest on your Direct Unsubsidized or Direct PLUS loans while you are in school. If you choose not to pay the interest while you re in school, we will add it to the unpaid principal amount of your loan. This is called capitalization, and it can substantially increase the amount you repay, especially if you are receiving multiple loans for a multi-year program. Capitalization increases the unpaid principal balance of your loan, and DL will then charge interest on the increased principal amount. It will save you some money in the long run if you pay the interest as it accrues on your loan while you re in school or during the grace period. This is also true if you pay any interest that accrues during periods of deferment or forbearance after you leave school. When you graduate or leave school Leaving school: graduating, withdrawing, or dropping below half-time Once you are no longer enrolled at least half time in an eligible program, you ll receive a 6-month grace period (see below) on your Direct Subsidized and Unsubsidized Loans during which you are not required to make loan payments. You must begin repayment at the end of your grace period. If you have an in-school deferment on a Direct Subsidized or Unsubsidized Loan that entered repayment at an earlier date before you returned to school and you graduate, drop below half-time enrollment, or withdraw from school, you will be required to immediately begin making payments on the loan because the 6-month grace period has already been used up; there is no second grace period. Make sure that both your school and the Direct Loan Servicing Center know that you are no longer enrolled. If you don t begin making payments when required, there is the possibility that you will lose repayment incentives you may have received or even go into default. CMC will require an Exit Counseling before you graduate or withdraw. You can complete online, for example, at the Direct Loan Servicing Web Site. Grace periods When you graduate, drop below half-time, or withdraw from your academic program, you will receive a six-month grace period for your Direct Subsidized and Unsubsidized Loans. Your grace period begins the day after you stop attending school on at least a half-time basis. Once your grace period ends, you must begin repaying your loan(s). If you re-enroll in school at least half time before the end of your 6-month grace period, you will receive the full 6-month grace period when you stop attending school or drop below half-time enrollment.

6 6 There is no grace period for Direct PLUS Loans the repayment period for each Direct PLUS Loan you receive begins 60 days after your school makes the last disbursement of the loan. If you re a parent PLUS borrower, you can defer repayment of Direct PLUS Loans first disbursed on or after July 1, 2008, while the student for whom you obtained the loan is enrolled at least half time, and for an additional 6 months after the student graduates or drops below half-time enrollment. Remember, if you choose to defer payment on a Direct PLUS Loan, any interest that accumulates during the deferment period will be added to the unpaid principal amount of your loan. This is called capitalization, and it increases your debt because you ll have to pay interest on this higher principal balance. Reservists Called to Active Duty: If you are called or ordered to active duty for more than 30 days from a reserve component of the U.S. Armed Forces, the period of your active duty service and the time necessary for you to re-enroll in school after your active duty ends are not counted as part of your grace period. However, the total period that is excluded from your grace period may not exceed three years. If the call or order to active duty occurs while you are in school and requires you to drop below half-time enrollment, the start of your grace period will be delayed until after the end of the excluded period. If the call or order to active duty occurs during your grace period, you will receive a full 6-month grace period at the end of the excluded period. If you are a reservist called to active duty with the U.S. Armed Forces for more than 30 days, contact the Direct Loan Servicing Center to let us know your status. Choosing a repayment plan You ll have the choice of several plans, and the Direct Loan Servicing Center will notify you of the date your first payment is due. If you do not choose a repayment plan, we will place you on the Standard Repayment Plan. Most Direct Loan borrowers choose to stay with the Standard Repayment Plan, but there are other options for borrowers who may need more time to repay or who need to make lower payments at the beginning of the repayment period. Consolidation If you have multiple federal education loans, you can consolidate them into a single Direct Consolidation Loan. This may simplify repayment if you are currently making separate loan payments to different loan holders, as you ll only have one monthly payment to make. There may be tradeoffs, however, so you ll want to learn about the advantages and possible disadvantages of consolidation before you consolidate Parents Direct Loans are low-interest loans for students and parents to help pay for the cost of a student s education after high school. The lender is the U.S. Department of Education (the Department) rather than a bank or other financial institution. With Direct Loans, you 4Borrow directly from the federal government and have a single contact-the Direct Loan Servicing Center-for everything related to the repayment of your loans, even if you receive Direct Loans at different schools; 4Have online access to your Direct Loan account information 24 hours a day, 7 days a week at Direct Loans on the Web at: 4Can choose from several repayment plans that are designed to meet the needs of almost any borrower, and you can switch repayment plans if your needs change. 1st-year undergraduate 2nd-year undergraduate 3rd- and 4th-year undergraduate Types of Direct Loans The following Direct Loans are made through the William D. Ford Federal Direct Loan (Direct Loan) Program, which is administered by the U.S. Department of Education: Direct Subsidized Loans 4Are for students with demonstrated financial need, as determined by federal regulations. No interest is charged while a student is in school at least half-time, during the grace period and during deferment periods. Direct Unsubsidized Loans 4Are not based on financial need; interest is charged during all periods, even during the time a student is in school and during grace and deferment periods. Direct PLUS Loans 4Are unsubsidized loans for the parents of dependent students and for graduate/professional students. PLUS loans help pay for education expenses up to the cost of attendance minus all other financial assistance. Interest is charged during all periods. Direct Consolidation Loans Dependent Student 1 $5,500 (maximum $3,500 subsidized) $6,500 ($4,500) $7,500 ($5,500) Independent Student 2 $9,500 ($3,500) $10,500 ($4,500) $12,500 ($5,500) 1 Except those whose parents are unable to borrow a PLUS loan. 2 These limits also apply to dependent students whose parents are unable to borrow a PLUS loan. 4Eligible federal student loans can be combined into one Direct Consolidation Loan. Parent eligibility requirements for a Direct PLUS Loan You must be the student s biological or adoptive parent or the student s stepparent, if the biological or adoptive parent has remarried at the time of application. Your child must be a dependent student who is enrolled at least half-time at CMC. For financial aid purposes, a student is considered dependent if he or she is under 24, unmarried, and has no legal dependents at the time the Free Application for Federal Student Aid is submitted. (Exceptions are made for veterans, wards of court, and other special circumstances.) If a student is considered dependent, then the income and the assets of the parent have to be reported on the FAFSA. Additional requirements to receive a PLUS loan Parent PLUS loan borrowers cannot have an adverse credit history (a credit check will be done). In addition, parents and their dependent child must be U.S. citizens or eligible noncitizens, must not be in default on any federal education loans or owe an overpayment on a federal education grant, and must meet other general eligibility requirements for the Federal Student Aid programs. You can find more information about these requirements in Funding Education Beyond High School: The Guide to Federal Student Aid available at: Applying for a PLUS Loan and the Master Promissory Note (MPN) To take out a Direct Loan for the first time, you must complete a PLUS Application and master promissory note (MPN). The MPN is a legal document in which you promise to repay your loan(s) and any accrued

7 7 interest and fees to the Department. It also explains the terms and conditions of your loan(s). CMC offers the option of completing the MPN electronically, you can do so online at the Direct Loans e-mpn website. If you are borrowing Direct PLUS Loans for more than one student, you ll need to complete a separate MPN for each one. To complete an MPN online, you will be required to use your Department of Educationissued PIN (not your child s). If you do not have a PIN, you may request one from the official PIN site. In most cases, once you ve submitted the MPN and it s been accepted, you won t have to fill out a new MPN for future loans you receive to pay for the educational expenses of the same student. You ll receive a disclosure statement that gives you specific information about any loan that CMC plans to disburse under your MPN, including the loan amount and loan fees, and the expected loan disbursement dates and amounts. Credit check & endorser alternative When you apply for a Direct PLUS Loan, the Department will check your credit history. To be eligible for a PLUS Loan, you must not have an adverse credit history. If you are found to have an adverse credit history, you may still borrow a PLUS Loan if you get an endorser who does not have an adverse credit history. An endorser is someone who agrees to repay the Direct PLUS Loan if you do not repay the loan. The endorser may not be the student on whose behalf a parent obtains a Direct PLUS Loan. In some cases, you may also be able to obtain a Direct PLUS Loan if you document to our satisfaction that there are extenuating circumstances related to your adverse credit history. Descriptions of Financial Aid Federal Grants: Federal Pell Grant: Pell Grants are awarded to help undergraduates (students who have not earned a Bachelors or Professional Degree) pay for their education after high school. For many students, these grants provide a foundation of financial aid to which aid from other federal and non-federal sources may be added. Grants do not have to be repaid. Awards may range up to $5,550 per academic year. Federal Supplemental Education Opportunity Grants (SEOG): This is a grant to help you pay for your education after high school. It is for undergraduates only. You could get up to $4,000 per year, depending on your need, the availability of SEOG funds at your school and the amount of other aid you receive. Colorado Grant: Money made available from the Colorado General Assembly to help you pay for your education. State grants include: College Responsibility Program (CRP) Colorado residents enrolled full time may get $1000 per academic year from CRP. Work-Study (Federal/Colorado): This program provides jobs usually in colleges/universities for undergraduate and graduate students who need financial aid. Some students will be working in a community service location. Loan limits, interest rate, and loan charges There are no set limits for Direct PLUS Loans, but you may not borrow more than the cost of your child s education minus any other financial aid received, such as a Direct Subsidized or Unsubsidized Loan. CMC will determine the actual amount you may borrow. The interest rate for Direct PLUS Loans is a fixed rate of 7.9%. Interest is charged on Direct PLUS Loans during all periods, beginning on the date of your loan s first disbursement. To find out more information on interest rates for Direct PLUS Loans, contact the Direct Loan Servicing Center. In addition to interest, you pay a loan origination fee that is a percentage of the principal amount of each Direct PLUS Loan that you receive. This fee helps reduce the cost of making these low-interest loans. We deduct the fee before you receive any loan money, so the loan amount you actually receive will be less than the amount you have to repay. Dependent students whose parents have applied for but were unable to get a PLUS Loan are eligible to receive additional Direct Unsubsidized Loan funds. How a loan is disbursed (paid out) Generally, your loan will cover a full academic year and your child s school will make at least two disbursements to you, for example, at the beginning of each semester. Using the loan for education expenses: You may use the loan money you receive only to pay for your child s education expenses at the school that is giving you the loan. Education expenses include school charges such as tuition, room and board, fees, and indirect expenses such as books, supplies, equipment, dependent child care expenses, transportation, and rental or purchase of a personal computer. Your pay will be at least the federal minimum wage, but it may also relate to the type and difficulty of the work you do. The total amount you earn in a year depends on how many hours per week you work. Most students perform work-study hours per week, although some do more or less. CMC sets the number of hours you can work based on your financial need. Are work-study jobs on- or off-campus? Both. However, a work-study job must always be for a public or private non-profit organization (limited). Federal Direct Stafford Loans: Is a low-interest loan made to you by the dependent student, to help you pay for your education after high school. The interest rate is fixed at 3.4% for Subsidized and 6.8% for Unsubsidized loans disbursed on/after July 1, There are two kinds of Direct Loans. The Subsidized is based on need and the government pays the interest while you are in school. The Unsubsidized is not need-based, so it is available to students regardless of financial need. While the student is still in school, the interest is automatically capi tal ized (i.e., added to the principal). However, the student may request to make interest payments while he or she is still in school. The money for these loans comes from the federal government. Most students will begin repayment six months after leaving college or when dropping below half-time status. Under some conditions, repayment may be deferred. The Unsubsidized loan has two tiers of loan limits. The higher loan limits are available to independent students and to dependent students whose parents cannot obtain PLUS Loans.

8 Award amounts are subject to change; stay in touch with the financial aid office. 8 Federal Family Direct PLUS Loans Graduate/professional students or parents of dependent undergraduates may be eligible for a PLUS Loan. Applicants must have a good credit history. Graduate students must fill out the FAFSA to determine their Stafford Loan eligibility before applying for a PLUS Loan. These loans are not based on financial need, and are, therefore, made regardless of income level. PLUS Loans are offered by banks, savings & loans, credit unions, etc. The interest rate is fixed at 7.9% for loans disbursed on/after July 1, PLUS repayment starts days after disbursement. Borrowers may use a PLUS Loan for the entire cost of attendance minus any other financial aid. Alternative Loan Alternative loans are available to students who are 4ot eligible for federal loans, or who need assistance beyond their financial aid eligibility. These loans are made privately through banks and other financial institutions and are subject to their terms. Costs? Ideally you want the loan with the lowest interest rate, lowest fees, and best customer service. Loans with lower fees often have higher interest rates, and loans with lower interest rates often have higher fees. You should do some calculations based on your specific situation to decide which one will serve you better. For Pell Grants, SEOG, State Grants, Work-Study, and Stafford Loans When your need/eligibility has been determined, and a financial aid package assembled, CMC will send you an award letter listing the kind(s) and amount(s) of aid you will receive For PLUS Loans You can apply for a PLUS Loan by going to com to establish an account, complete the promissory note and do an on-line credit check. In addition, your lender of choice may also have applications. CMC will certify your loan once your credit check is complete. Help from tax breaks Current federal tax laws provide help for students and parents with their higher education expenses. The Hope Scholarship Credit, for example, allows up to $1,650 to be subtracted from federal income taxes for tuition and required fees. This credit is available for the first two years of college for each student in the family. The Lifetime Learning Credit is for up to $2,000 per year for tuition and required fees for any undergraduate, graduate or professional study. This credit is available for each family (not each student). Colorado Mountain College will send form 1098-T with information needed to claim the Hope Scholarship and Lifetime Learning tax credits. You will need the IRS form 8863 to file with your income tax return. The Student Loan Interest Deduction allows up to $2,500 to be deducted from the income on which taxes are paid. Your lender should send form 1099-E with information needed to claim the student loan interest deduction. IRS forms 1040 and 1040A include an option to claim this deduction. The Tuition and Fees Deduction allows taxpayers to deduct up to $4,000 of qualified expenses for the 2009 tax year. Taxpayers cannot claim this deduction and a Hope or Lifetime Learning credit for educational expenses paid in the same year. Note that neither your college nor your lender may provide all the information needed for you to claim these tax benefits. You will need to keep careful records of your educational expenses and how you paid for them. Your financial aid, student loan and academic documents also may be important to help you claim the tax benefits. Caution: There are income restrictions on the above tax benefits. And there are other details that seriously affect them as well. Be sure to check with a tax professional on all the details before applying for these benefits on your tax return. Other tax benefits are also available to students and parents. They include a Coverdell (ESA), early withdrawals from other IRAs, Qualified State Tuition Programs, education savings bonds and employerprovided assistance. There are rules and restrictions that affect these tax benefits, too. Be sure to check with your tax professional and your school s financial aid office for specific details on these benefits as they become available for your possible use. Important terms Promissory Note: A legal document that obligates the borrower to repay the loan. Notice of Loan Disclosure Statement: A document specifying the interest rate, when a check will be disbursed and mailed, how much the net proceeds of the check will be, and the amount of origination fee deducted from the gross amount of the loan. Disbursement: Handing over the loan proceeds to the borrower. In federal programs the money for PLUS Loans will be sent to the school. Origination Fee: A fee charged by the U.S. Department of Education to offset the cost of the federal student loan program. The fee is usually deducted from the loan proceeds. Default Fee: A fee, default insurance, charged for federally backed student loans. It usually is deducted from the loan proceeds and sent to the guarantor. Note: You are obligated to repay your loan even if you do not complete your educational program; you are not satisfied with the education or other services you purchased from a school; you cannot find employment, (although you may apply to defer payment for a specified time).

9 Common financial aid questions Tax laws will change as Congress and the IRS pass new regulations. Will my parents contribution be less if any of my brothers or sisters are also continuing their education beyond high school? Generally speaking, yes. Your parents contribution might be lower if both parents are working, and about 50% lower if they are helping more than one of their children through college or career school at the same time. My parents are divorced (separated). Which parent should complete the financial aid application? The parent who should complete the application is the one with whom you lived for the longest period during the last 12 months. If you didn t live with either parent, or lived with each parent for an equal number of days, the application should be filled out by the parent who provided the most support for you during the last 12 months. Support means money for such things as housing, food, clothes, transportation, medical and dental care, and school. If I have a guardian, is he or she supposed to file a financial aid application? No, grandparents, foster parents and legal guardians are not considered parents on the FAFSA unless he/she legally adopted you. Is a stepparent expected to complete the financial aid application even though they feel no responsibility to support my education? Federal programs and CMC expect a stepparent s information to be included on the financial aid application. What is satisfactory academic progress? All students receiving federal- and/or state-funded financial aid are required to meet certain standards that ensure that they are making reasonable progress toward obtaining a degree or certificate. In addition to grade point average, students are expected to complete a minimum number of credit hours each semester. The number of hours to be completed will vary according to the student s enrollment classification. Students also have a maximum time frame that must be adhered to. A detailed Satisfactory Academic Progress Policy is made available at Financial Aid Facts on our website. 9 Common mistakes you can avoid on your financial aid application Here are some of the most common mistakes students/parents make and that you can avoid. 4Forgetting to sign the application. Be sure both student and parent apply for a PIN to sign. If you re submitting at pin.ed.gov 4For income reporting, parents often use their W-2 form. They should take the Adjusted Gross Income from their last 1040 federal tax return. 4When reporting taxes paid, parents often use the taxes withheld on their W-2 form. They should list the actual taxes paid as shown on their last 1040 federal tax return. How to contact us Alpine Campus (970) Bob Adams Drive Steamboat Springs, CO Roaring Fork Campus Spring Valley (970) County Road 114 Glenwood Springs, CO Timberline Campus (719) South Highway 24 Leadville, CO Central Service & Financial Aid Office (970) or Grand Avenue (PO Box 1668) Glenwood Springs, CO Students/parents often forget to report all required sources of untaxed income. They should include Social Security, child support, welfare benefits, including TANF and earned income credit. 4Divorced parents sometimes include their ex-spouses income. They should list only their own income and that of their current spouse. 4Forgetting to fill out a separate application for a Stafford Loan if required. Check with your college s financial aid office to verify how they process their student loans. 4Forgetting to round off numbers to the nearest dollar. 4Follow instructions. This information sheet was prepared in advance for the award year. Information is subject to change without notice.