FA Question: Inherited house, now worth $1M, now what?

[Anonymous]

Anonymous wrote:This is stunning. Your net worth is over $1 million, and you want financial aid. What are you doing with your earnings? Just because you could not afford to buy this home does not mean you deserve FA. The sense of entitlement ...

Yes, I do want financial aid. I didn't earn $1M. My house increased in value, but that has nothing to do with me. I have saved what I've been able to save on my income. I think FA should take into consideration an individual's situation. I have been living on a fairly low income for a long time. I lucked into the house, but it's where my family lives. Would you sell your only home just to finance your child's education? I don't think that's reasonable. If I'd inherited stocks that increased in value, well, that's different, because I could sell them without jeopardizing my family. But our house? We're not making any income off of it. We live in it.

I'm not going to convince you. I just want to find out if anyone in a similar situation has dealt with this.

On an income of $104K (pre-tax) do you honestly think we could come up with anything close to $60K for college tuition?

That's insane.

[Anonymous]

Anonymous wrote:My parents were in a similar situation. We got no FA at all, and there were 3 of us in college at the same time. They told my parents to take out the equity in the house to pay for school.

But I'll bet you went to state schools, and I'll bet they cost a fraction of what private colleges cost now.

[Anonymous]

You could sell the million dollar house, move into a 200k apartment, and use the 800k profit for college expenses.

[Anonymous]

Anonymous wrote:

Anonymous wrote:This is stunning. Your net worth is over $1 million, and you want financial aid. What are you doing with your earnings? Just because you could not afford to buy this home does not mean you deserve FA. The sense of entitlement ...

Yes, I do want financial aid. I didn't earn $1M. My house increased in value, but that has nothing to do with me. I have saved what I've been able to save on my income. I think FA should take into consideration an individual's situation. I have been living on a fairly low income for a long time. I lucked into the house, but it's where my family lives. Would you sell your only home just to finance your child's education? I don't think that's reasonable. If I'd inherited stocks that increased in value, well, that's different, because I could sell them without jeopardizing my family. But our house? We're not making any income off of it. We live in it.

I'm not going to convince you. I just want to find out if anyone in a similar situation has dealt with this.

On an income of $104K (pre-tax) do you honestly think we could come up with anything close to $60K for college tuition?

That's insane.

What's insane is that the median family in America makes half of what you do and with only 65% of Americans owning a house, many of those people rent. How many are sitting on $1m home, even one with unrenovated bathrooms. Have you considered how many children deserve and need scholarships? You are certainly more deserving than others with greater assets, but your attitude is disturbing. You chose to have four kids and you would like to stay in the house, so what gives?

[Anonymous]

Anonymous wrote:You could sell the million dollar house, move into a 200k apartment, and use the 800k profit for college expenses.

OMG this is insane

[Anonymous]

Anonymous wrote:

Anonymous wrote:This is stunning. Your net worth is over $1 million, and you want financial aid. What are you doing with your earnings? Just because you could not afford to buy this home does not mean you deserve FA. The sense of entitlement ...

Yes, I do want financial aid. I didn't earn $1M. My house increased in value, but that has nothing to do with me. I have saved what I've been able to save on my income. I think FA should take into consideration an individual's situation. I have been living on a fairly low income for a long time. I lucked into the house, but it's where my family lives. Would you sell your only home just to finance your child's education? I don't think that's reasonable. If I'd inherited stocks that increased in value, well, that's different, because I could sell them without jeopardizing my family. But our house? We're not making any income off of it. We live in it.

I'm not going to convince you. I just want to find out if anyone in a similar situation has dealt with this.

On an income of $104K (pre-tax) do you honestly think we could come up with anything close to $60K for college tuition?

That's insane.

You have the equivalent of $1,000,000 sitting in the bank. No, you do not get aid. The End.

[Anonymous]

Anonymous wrote:

Anonymous wrote:You could sell the million dollar house, move into a 200k apartment, and use the 800k profit for college expenses.

OMG this is insane

No, it's what many, many people have to do. Welcome to the real world!

[Anonymous]

Do you both work? Do you want financial aid for all four kids to attend this kind of college?

[Anonymous]

The same thing happens on College Confidential all the time. Some person innocently posts about his/her financial situation, asks how that will affect their ability to qualify for aid, and is called out by scores of subsequent posters for being greedy. So tiresome - if you don't have information for her about how home equity is factored into colleges' need-based aid determinations, could you just move on and skip the comments about greediness.

More than ever, college financial aid is a game. Colleges want to use their aid dollars to improve the profile of their class and generate the greatest return they can - it's way better for them to give $25K to 2 kids, both of whom will then pay $25K in tuition than it is to give a full $50k ride to one kid who won't pay anything.

It's also a game for parents. What school will look at my financial situation/child's qualifications most favorably and give me the greatest amount of $. It is not selfish or in any way inappropriate for the poster to ask. My advice to her would be to find schools that don't take home equity into account when tabulating your assets. Most do, but many do not.

[Anonymous]

You sell the house and get a smaller one.

[Anonymous]

Anonymous wrote:You could sell the million dollar house, move into a 200k apartment, and use the 800k profit for college expenses.

+1

More like sell the house and buy a 4-700k house. Your income can't support a million dollar house maintenance, taxes and utilities.

[Anonymous]

Anonymous wrote:The same thing happens on College Confidential all the time. Some person innocently posts about his/her financial situation, asks how that will affect their ability to qualify for aid, and is called out by scores of subsequent posters for being greedy. So tiresome - if you don't have information for her about how home equity is factored into colleges' need-based aid determinations, could you just move on and skip the comments about greediness.

More than ever, college financial aid is a game. Colleges want to use their aid dollars to improve the profile of their class and generate the greatest return they can - it's way better for them to give $25K to 2 kids, both of whom will then pay $25K in tuition than it is to give a full $50k ride to one kid who won't pay anything.

It's also a game for parents. What school will look at my financial situation/child's qualifications most favorably and give me the greatest amount of $. It is not selfish or in any way inappropriate for the poster to ask. My advice to her would be to find schools that don't take home equity into account when tabulating your assets. Most do, but many do not.

You sound like you know what you're talking about. As a follow up, how do you recommend the OP determine which schools do take home equity into account and which don't? Do colleges consider whether both parents work? Thanks.

[Anonymous]

Couldn't you just borrow $200K through an equity loan?

[Anonymous]

Anonymous wrote:Couldn't you just borrow $200K through an equity loan?

She already said they can't make payments on a loan. OP lives beyond her means and is teaching her children the same.

[Anonymous]

Look. We earn roughly the same as you do (just under 100k, if you want to split hairs) and we spend about $30K every year on our mortgage. Even figuring $10k of that is property taxes and insurance, which we would need to pay regardless, that's $20k a YEAR of extra spending power that goes to the nice folks who hold our note, instead of to skating lessons and dinners out. Even so, we manage to put a bit aside each month for retirement and college savings. We also trust in the power of compounded growth to turn our little bit into bigger bits over the long run.

For your self-described "very long time," you have enjoyed the luxury of having thousands of extra dollars each month to spend (or save) as you will. And so again, I ask you, what have you been doing with it all this time?