FAFSA concern - former residential home is now investment property

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mbaapplicant2017
Posts: 2
Joined: Fri Jan 12, 2018 12:05 pm

FAFSA concern - former residential home is now investment property

Post by mbaapplicant2017 » Fri Jan 12, 2018 12:13 pm

Hi All,

I'm posting from another account to hide some personal details.

I just submitted MBA applications and am thinking about applying for FAFSA in the next few weeks. I did a little digging, and it looks like investment homes are counted (as they should be) as assets. However, I'm in a situation where I purchased a residential property in Boston with my wife a couple years ago, then moved to New York late last year. We decided to keep our house while we rent in NYC, as we're very likely to return to Boston in the near future.

Unfortunately, I think this now means that what was 150k-200k (due to significantly increased home value) in home equity of a residential home, is now 150k-200k in home equity of an investment property. On top of that we have 50k in cash that we've been saving up for business school.

With these numbers, I'm a little nervous that we might not receive any federal loans...

First off, do you agree with my evaluation? And second, is there anything I can do now to maximize my chances?

Thank you in advance for any helpful responses / suggestions.

DIFAR31
Posts: 159
Joined: Mon Jan 01, 2018 5:51 pm

Re: FAFSA concern - former residential home is now investment property

Post by DIFAR31 » Fri Jan 12, 2018 5:42 pm

Equity in real property that isn't being used as your primary residence needs to be reported as an asset on FAFSA.

A far as I know, FAFSA EFC will be used to determine how much (if any) of available loans will be subsidized and how much will not be subsidized, but I don't think EFC has anything to do with the total amount of federal loans available. Also, I don't think subsidized loans are even available for graduate work.

sailaway
Posts: 446
Joined: Fri May 12, 2017 1:11 pm

Re: FAFSA concern - former residential home is now investment property

Post by sailaway » Fri Jan 12, 2018 5:51 pm

According to ed.gov, grad students are not eligible for subsidized loans. Unsubsidized loans are not need based.


mbaapplicant2017
Posts: 2
Joined: Fri Jan 12, 2018 12:05 pm

Re: FAFSA concern - former residential home is now investment property

Post by mbaapplicant2017 » Thu Jan 18, 2018 2:18 pm

Thanks everyone for your responses! That's new (and unfortunate) news to me, so thanks for pointing it out. I was also able to confirm that MBA government loans only come unsubsidized.

But hey, at least I won't have to look for shady ways to hide my primary turned investment home...

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