College Student Aid and Chapter 13 Bankruptcy

[mhsaltz]

A liitle background. My wife and I are six months into our Chapter 13 bankruptcy. My daughter is now about twenty one months away from starting college. There is a little bit saved for her but certainly nowhere near what its going to take to pay for for four years of college. My basic understanding is that student aid is need based, effectively what parents can afford to contribute based on various calculations made by the college and or Federal government. Our situtaion is that we will not be able to contribute anything until my daughter is a junior in college, which will be be(god willing) when the bankruptcy is discharged. Chapter 13 monthly trustee payments are supposed to represent all disposable income after day to day living costs are subtracted from income. This leaves nothing for us to contribute. Will the colleges/Federal government consider this in determining if my daughter is eligible for student aid? Has anyone been down this road? One of my deepest regrets is having my irresponsibility put my daughter in this position. Any advice or experiences with this would be appreciated. Thanks.

[LadyInTheRed]

My only student aid experience is from when I was a student 20 years ago. I remember being shocked at the expected family contribution [EFC]. I also remember that whenever issues come up with my aid, the financial aid counselors at school were very helpful and kind and did whatever they could to find solutions. The could be very resourcesfu.

There wasn't anything they could do about my EFC, but there was no bankruptcy involved. From the Fedral Student website:

A financial aid administrator can consider special or unusual circumstances such as unusual medical expenses, tuition expenses, or unemployment and can adjust your cost of attendance or some of the information used to calculate your EFC. The financial aid administrator at your college or career school also can change your status from dependent to independent but only under specific circumstances the aid administrator will explain. You'll have to provide your college or career school with documentation to justify any change. The decision to change or not to change your dependency status is based on the aid administrator's judgment, and it's final. It can't be appealed to the U.S. Department of Education.

http://studentaid.ed.gov/PORTALSWebApp/students/english/aideligibility.jsp?tab=funding

There is a tool on that website that will help you estimate eligibility.

Most, if not all, need base support, even if not from federal grants, will be based on your federal application. Submit the FAFSA as soon as possible and as soon as you receive the Student Aid Report, make an appointment with a financial aid counselor at your daughter's school so they can help make any adjustments and locate additional sources of aid.

Another thing your daughter should consider is going to a community college for the first two years. I have a friend who is a university professor who swears the community college is the best place to get general education. The classes are smaller and the instructors are just as good.

Good luck!