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Bucks Blog: On Safeguarding Your Student Aid PIN

October 5, 2012 by Leave a Comment

Loanlook, a Web site that aims to help students and families manage their educational loans, has added access to private student loans, as well as federal loans. That should, in theory, make the site more attractive to students and parents looking for a way to keep track of all of their student loans in one place.

But it appears the site may be operating counter to guidelines from the Department of Education’s Office of Federal Student Aid, which warn student borrowers to safeguard their financial aid PINs and refrain from sharing them with anyone. That may be another reason for users to be wary of the site, which already faces skepticism because its parent company, the Ceannate Corporation, also is in the business of student loan debt collection.

As Bucks reported in August, Loanlook asks users to provide their four-digit federal PINs, which are assigned by the student aid office so students can gain access to information in the National Student Loan Data System. The PIN allows Loanlook to obtain information like loan totals and terms on behalf of the borrower so it can help suggest optimal repayment plans.

According to the Federal Student Aid PIN Web site, the PIN is used in combination with a birth date and Social Security number to allow access to federal student aid records online and to complete the Free Application for Federal Student Aid, or Fafsa, form.

“Your PIN can be used each year to electronically apply for federal student aid and to access your federal student aid records online,” the site says. “If you receive a PIN, you agree not to share it with anyone. Your PIN serves as your electronic signature and provides access to your personal records, so you should never give your PIN to anyone, including commercial services that offer to help you complete your Fafsa,” the student aid application. “Be sure to keep your PIN in a safe place.”

Given that warning, some readers, including a former student aid counselor, questioned whether it was acceptable for students to use their PINs to get access to loan information through Loanlook.

So I tried to ask the Department of Education this question: If I’m a student borrower who wants to use Loanlook’s services, is it O.K. for me to enter my PIN on the site? I contacted the department’s press office several times. Finally, after mulling the inquiry for more than five weeks, the office said it would not comment on Loanlook specifically — even though the site’s parent, Ceannate, is a contractor with the department, providing services like student loan collections. But it e-mailed this response on Wednesday from Daren Briscoe, the department’s deputy press secretary:

“As guidance posted for borrowers on the department’s Web site advises — you should never give your PIN to anyone, including commercial services.”

Not exactly a ringing endorsement.

Loanlook officials maintain that the site complies with federal guidelines. Some students have access to Loanlook through their colleges and don’t need to use their PINs. Students who come to the site individually do provide their PINs, but the site does not store them, to help guard against potential misuse, said Loanlook’s chief executive, Balaji Rajan. Students must re-enter their PINs each time they want to update their loan information.

“Loanlook only uses the PIN as a one-time event to confirm the identity of the borrower and the borrower’s right to access loan data,” he wrote in an e-mail. He added, “It is important to note that the PIN is provided only to facilitate Loanlook’s services (as an agent and representative of the borrower) to access loan data, and for no other purpose.”

Further, he said, when registering on Loanlook, users give approval on a Department of Education disclosure form that allows release of their information.

Still, Loanlook posted an update on its blog last week stating that the Department of Education now offers a feature, called “MyStudentData Download,” that provides an alternative to using the PIN. The feature provides a text version of a student’s loan information that can be downloaded from the National Student Loan Data System site, and then transferred to third-party sites, like Loanlook. That sounds cumbersome, though it does get around the PIN problem.

“We expect that most of you will continue to retrieve your student loan data with your NSLDS PIN (generally the quickest way to refresh loan profiles on loanlook.com),” the Loanlook post said. “But you will soon have the option to upload the text file provided by NSLDS to your Loanlook account as well.”

What do you think? Would you feel comfortable using your financial aid PIN to use loan management sites like Loanlook? Or would you take the time to download your files?

Article source: http://bucks.blogs.nytimes.com/2012/10/04/on-safeguarding-your-student-aid-pin/?partner=rss&emc=rss

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Bucks Blog: How to File for Financial Aid if Your Parents Are Gay

October 15, 2011 by Leave a Comment

The Cost of Being Gay

A look at the financial realities of same-sex partnerships.

Filling out the federal form for student financial aid is an arduous task for most applicants. But if you have two mothers or two fathers, or if you happen to be married to a same-sex partner, it can quickly escalate into an even more complicated exercise.

Since the federal government doesn’t recognize same-sex marriage, neither does the federal form, called the Free Application for Federal Student Aid, informally known as the Fafsa. So students whose immediate families include same-sex partners often find themselves struggling to figure out how to accurately represent their families. The 106-question form only asks applicants to list their “mother/stepmother” and “father/stepfather.”

For now, there are no easy fixes. It’s not as simple as adding in gender-neutral language on the form, something the Department of State recently did to passport applications to acknowledge that some children are being raised by same-sex parents. That’s because the amount and type of aid provided to students uses a formula that takes the entire family unit into account — including the parents and students’ marital status. And the Department of Education said it relies on the federal definition of marriage (one man, one woman).

For now, applicants must fill out the form according to the current rules, which can result in applicants getting more or less aid than identical families with opposite-sex partners.

Here are some guidelines for students with same-sex parents or same-sex partners, as well as gay students who have been cut off financially by their parents. The tips were provided by Mark Kantrowitz, the financial aid expert and publisher of FinAid.org. As he said, “It gets real complicated real fast.”

You have two legal parents (biological or adopted) but they are no longer together. Only the one you are living with is responsible for completing the Fafsa. And if the parent you live with has married someone of the same sex, the income and assets of the stepparent are not reported on the form since the marriage is not recognized by the federal government. But the stepparent is included for the purposes of “household size” if the legal parent also provides more than half of the support for the stepparent. The same applies to the stepparent’s children. (In a heterosexual marriage, the stepparent and stepchildren living in the home are automatically included in the household size.) And any financial support that your stepparent provides will be counted as untaxed income on the Fafsa.

Keep in mind that if the student is attending a college in a state that recognizes same-sex marriage, it is possible that the college will also treat the stepparent as a parent for state aid and institutional aid purposes, Mr. Kantrowitz said, even if the federal aid is based only on the other parent.

You have two parents, but only one is a legal parent. Only the legal parent is responsible for completing the Fafsa. The other parent (and his or her children) will be included in household size only if the legal parent provides more than half of their support. And once again, if the other parent provides you with any additional financial support, it will be counted as untaxed income to you on the form.

This will affect families who live in states that don’t permit same-sex couples to have second-parent adoptions. That occurs when one partner adopts the other’s biological or adopted children.

You have two legal parents — whether biological or adoptive — and you live with both. You must fill out the form as if they were divorced. In a heterosexual divorce, the parent with whom the child lives for most of the time is responsible for completing the form. But if the student splits time equally with both parents, only the parent who provided more support is responsible.

Since students with married same-sex parents typically live with both parents, they, too, must have the parent who provided more financial support complete the form. The other parent’s income and assets are not reported, and that parent will only be included in the official household size if the parent filling out the form provides more than half of the applicant’s support. And if the “second” parent has any children who are not legal children of the parent on the Fafsa, the children won’t be included in household size unless the Fafsa parent provides more than half of their support, too. (This is unlike heterosexual married couples, who would automatically include all dependent children and stepchildren, regardless of whether they live in the family home.)

Meanwhile, if the “second” parent — that is, the one not on the Fafsa — provides support to the prospective student, it should be reported as untaxed income to the student.

Both parents may be considered in certain situations. If, for instance, you are attending college in a state where same-sex marriage is legal, the college may include your second parent for state aid and institutional aid purposes, even though federal aid is based just on the one parent.

You are a student who is married to a same-sex partner. You’re treated as if you are simply living together, so you wouldn’t include your spouse on the form unless you contribute more than half of his or her support. If you do, the partner would be included for the purposes of household size (but you don’t have to report your partner’s income). The same rules apply for your spouse’s children. (Of course, opposite-sex married applicants include their spouse’s income, if they have it, and they are automatically included in household size; the same goes for stepchildren.)

If your partner provides you with any financial support, it would count as untaxed income on the Fafsa.

Keep in mind that gay and lesbian students who are married and under the age of 24 may still be considered dependents of their parents, unlike heterosexual married students under the age of 24. Once again, it’s because their unions are not recognized by the federal government. But if you have children, you will be considered independent — as long as your parents don’t provide more than half of your children’s support. (The same goes for unmarried but partnered heterosexuals.)

You are a gay or lesbian student, and your parents refused to fill out the Fafsa form or provide support. Those circumstances alone are not “sufficient ground” for a college to grant you independent status, Mr. Kantrowitz said. But college financial aid administrators have the authority to deem you independent under certain circumstances, as well as other situations where students become estranged from their families. The college can do what is called a “dependency override,” which means it will treat you as financially independent from your parents. (For purposes of federal aid, students are generally considered dependents until age 24.)

“The student will need to ask the college for a professional judgment review to determine whether they qualify,” Mr. Kantrowitz said, adding that only the college financial aid administrator can approve a dependency override. “The student will need to supply documentation of their circumstances, such as letters from clergy, social workers, guidance counselors or others who are familiar with their situation.”

But just because the college has the authority to grant you independent status doesn’t mean that it necessarily will — or that the process will be easy, as evidenced by the student in my article whose family cut him off after he told them he couldn’t change his sexual orientation. The administrators decide what to do on a case-by-case basis.

Consider a recent graduate from a liberal arts college in Maine. After he told his financial aid office that his mother cut off support when she learned that he was gay, the administrators recommended that he switch to a less expensive college. “There were very few resources at my school to help me,” said the student, who is now in his first year of graduate school and wanted to remain anonymous because he didn’t want to openly criticize the college. “The college couldn’t extend emergency support because anyone could claim they were gay, lesbian, bisexual or transgender and had been excluded from family resources.”

The college eventually decided that it would grant the student independent status — but only after a friend suggested that he get in touch with a gay trustee who sat on the college’s board to lobby on his behalf. The financial aid office wasn’t pleased that he sought a higher authority, but his strategy worked. “I am still not sure how that process works or who calls the shots,” he said. The student also received a scholarship from Point Foundation, which provides support to gay, lesbian and transgender students. Without their help, he said he would have graduated with $30,000 in student loan debt instead of $14,000.

Even if your college decides not to grant you independent status, you may still be eligible for some federal loans. The Higher Education Opportunity Act of 2008 added a new provision that allows students whose parents have severed financial support to qualify for unsubsidized Stafford loans without parental information on the Fafsa (though they are not eligible for other types of federal aid, like Pell Grants or federal work-study programs). But eligibility is determined by the college financial aid administrators.

You’re thinking about listing your two moms or two dads, even though the form only provides space for “mother/stepmother” and “father/stepfather.” Just like federal tax forms, there is no way to automatically reject applications that list two mothers or two fathers. “But if the Fafsa is selected for verification, and the financial aid administrator notices that the parents listed on the Fafsa are of the same sex, they have an affirmative obligation to require the students to correct the Fafsa,” Mr. Kantrowitz said.

This could be viewed as an innocent mistake, he added, since the Fafsa instructions do not address such a situation with much clarity.

But if you choose to list them both and know that you aren’t supposed to, and the financial aid officers figure that out, well, don’t expect any favors. “Financial aid administrators tend to not give students the benefit of the doubt on other problems when they notice a deliberate inaccuracy,” he said. “They’ll view the entire Fafsa with a greater degree of suspicion.”

So don’t use the Fafsa as a place to cast a protest vote. And if you have any questions on how to fill out the form properly, ask the financial aid administrators what to do before you file.

Have you faced any challenges when filling out the federal form for aid? Have any helpful hints? Please drop your thoughts in the comment section below.

Article source: http://feeds.nytimes.com/click.phdo?i=a5c8fcf738d5e02c48d9ff2abd71aa91

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For Children of Same-Sex Couples, a Student Aid Maze

October 14, 2011 by Leave a Comment

Further confusing matters, her mothers had since split and married other women; they have six children among them. “It was so stressful and so frustrating to try to fit our family into those forms when so clearly it wasn’t going to fit,” said the student, who is now a senior at a university in Illinois and wanted to remain anonymous to keep her family’s financial affairs private. “You feel like you are lying no matter what you do.”

The aid form, the Free Application for Federal Student Aid, is the single most important document in determining how much and what type of financial aid students get. But the form, informally called Fafsa, has not kept up with the changing composition of families, in large part because the federal agency that issues it has to abide by the Defense of Marriage Act, which recognizes only heterosexual marriage. Because these students cannot fully portray their family’s finances, the amount of aid they receive may not fairly reflect their needs.

“In some cases, they are robbed of aid they would have otherwise received, and in other instances they benefit from it,” said Crosby Burns, special assistant for the Lesbian, Gay, Bisexual and Transgender Research and Communications Project at the Center for American Progress, a research organization that recently published a report about these issues in the financial aid process.

This is not solely an issue for children of same-sex parents. Any children with unusual family circumstances — whether their parent is in jail, involved in a messy divorce or simply refuses to provide support — can have trouble filling out the form. The form’s length and complexity is often a deterrent for would-be students with lower incomes, too. No numbers are available on the number of students from gay and lesbian families who are affected, though Gary Gates, a demographer with the Williams Institute, which studies sexual orientation law and policy issues, has calculated that about 220,000 children under age 18 are being raised by same-sex parents.

Though it is not immediately clear from the actual form, officials from the Department of Education, which issues it, said that applicants with two married mothers or fathers must fill out the Fafsa as if the couple were divorced. They must choose the legal parent who provides more support, which means that the other parent’s income and assets are often ignored. That can give the impression that the student requires more aid — or less — than one from an identical family headed by heterosexual parents. Applicants with same-sex partners, meanwhile, may not be able to include their spouses or other dependents on the form. Other gay students, who are now out on their own because their families have cut off support on learning about their sexual orientation, have difficulty establishing themselves as financially independent. (In some instances, however, colleges could choose to include more information provided by the student and include it in their calculations.)

“Since most other financial aid depends on the application for federal aid, these distortions will trickle down throughout the entire financial aid application process, even outside the federal government’s support,” Mr. Burns said.

The section of the financial aid form that asks for parental information has two lines: one for the applicant’s father/stepfather and another for mother/stepmother. The form also asks for the parents’ marital status, as well as the applicant’s marital status, using the federal definition.

“There is the stigma and indignity of having to list them as divorced, when they are, in fact, not,” said Emily Hecht-McGowan, director of public policy at the Family Equality Council, “It creates confusion and this extra step that children raised by L.G.B.T. parents have to go through,” she added referring to lesbian, gay, bisexual and transgender individuals.

An undergraduate at Harvard, meanwhile, said his challenge was trying to figure out how to get financial aid while excluding his parents. He said that when he was home during winter break in his sophomore year, he told his parents he could not change his sexual orientation. His parents promptly decided to cut off their financial contribution to his studies, he said, and asked him to leave the family home. (The student wanted to remain anonymous to protect his parent’s identities.) He scraped together the last of his savings to get a plane ticket back to Harvard, and his resident dean helped him find a place to stay for the remainder of the break.

But figuring out how to pay tuition was a bigger hurdle. Students under the age of 24 generally must have their parents fill out the Fafsa, unless they can persuade their institution to grant them independent status, which colleges have the power to do. But the Harvard student said that he was told that the university typically required students to take two years off to be deemed independent. “When I first heard this, I was mildly panicking,” he said. “I had no idea what I could do for two years or where I could do it.”

Ultimately, the university agreed to grant him independent status, as long as he took out about $10,000 in total loans, kept a part-time job, and visited a counselor (which made him uncomfortable, since his only experience with therapists was with those who tried to convince him that he could change his sexuality). He was also required to get a letter from his parents explaining why they cut off financial support — something he knew he could not possibly do.

Article source: http://feeds.nytimes.com/click.phdo?i=a700ad8b1de0ed6f708851579f27c315

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