A General Overview of Financial Aid

College Financial Aid

Let’s start at the beginning. First, even though I don’t recommend slacking off in high school, you don’t have to get an academic scholarship to go to college for free, or close to free. Speak to the financial aid counselor the summer prior to your freshman fall semester. I did and I was surprised to learn that I was eligible for a Pell Grant. The reason I was eligible for this grant was due to income, which was non-existent at the time. Many people will also qualify for this grant with low incomes. I was fortunate enough to have two years of college paid for and money for books. The same counselor will be able to advise you on other types of grants (as well as academic and sports scholarships) and circumstances for which they are awarded.

Make sure to check online as a second step after you meet with your financial aid counselor. There are many charitable and philanthropic organizations that offer academic, sports and special interest scholarships as well. You can find scholarships for people of different races, religions and anything that people might have in common. There are plenty of these so do your research.

Government Financial Aid

The single biggest source of free money comes from out U.S. Government. Along with social security, and the most recent stimulus checks citizens of this country received, there are numerous reasons for government aid.

The main theme for government assistance is growth and, secondarily, sustenance. If the government can provide you with money to boost the economy then it is likely there is a program for you. There are government grants to start a business if the right criteria are met, grants to purchase a home if you are a first-time home-buyer, health-care grants and grants for every reason in these categories and more. The single most important source for
finding these programs is the internet. Knowledge is power and, if you do your research, you can find government funding to help you do just about anything.

Furthermore, government websites allow you to propose reasons to use already budgeted funds for grant purposes. If you believe that you have a legitimate reason for government funds as an economic-minded citizen, or perhaps as a charitable organization or state representative, you have the write to submit your proposal in writing to review.

Last, don’t forget to check your local treasury online for lost money. I had heard about this on the news one time and checked for myself. I had over $1,000 waiting for me in a state I previously lived in. Some were closed accounts, some were reimbursements for items and one was even a rebate for computer software I had purchased. I claimed the funds and it was nice to receive an unexpected windfall. Companies are required to send unclaimed funds to the state treasury if they are unable to find the recipient of those funds which is why it sits there waiting for you to claim it.

So you see, there is money out there. You just have to be willing to spend the time to find it. Utilize your resources to get where you want to go and the money will appear from somewhere or another. Don’t ever forget to make the most of your time and always be moving forward to make money and spend time with your loved ones so you can enjoy your life to the fullest, whether it’s free money or not.

W. Paul Stogner

The United States Credit Crisis

As you’re probably well aware, we have a problem in the United States; it’s the financial system. Our economy and the systemic problems we are facing now threaten the security and stability of the dollar now more than ever before. This can be proven not only through the media and the actual details of the damage itself that has been done by our risky decision-making, but by the continual rise in the price of gold as investors retreat from securities to find a safe-haven. Bail-outs of major banks and reckless spending by our government have caused a national deficit larger than any ever recorded in the history of our country. Inflation is hitting us where it hurts the most, our wallets. When this is coupled with higher gas prices mostly from oil production being decreased due to global turmoil and natural disasters here
domestically, one must wonder if a collapse could take place.

It all began with greed. People with insufficient credit scores (the inability to pay their bills), which directly translates to lower income persons and poor judgment in financing decisions, to purchase homes wanted to live beyond their means. Major retail banks and mortgage lenders saw this opportunity to charge higher interest rates and profit further. They never saw what was coming.

The United States credit crisis was primarily caused by the offering of so-called “safe” investments by banks and mortgage companies and lenders. These types of loans were called sub-prime mortgages. When a borrower would not qualify for a traditional 30 or 15 year Fixed (Fannie Mae or Freddie Mac Agency) loan, the borrower was typically referred to a sub-prime mortgage lender. Sub-prime mortgage lending would provide you with a two or three-year ARM (adjustable rate mortgage – meaning not fixed). The starting rate would be anywhere from 8-11% (yes, that’s right) and would be fixed only for the two or three year term. For ever year after that term that you kept the loan, your interest rate would increase two percentage points. So, you could end up with a 17% interest rate in year five.

As if what I just said wasn’t bad enough, these loans were being handed out to people who couldn’t pay their bills in the first place and typically had pre-payment penalties of astronomical amounts, so you would have to pay that and closing costs to refinance to even keep your home without selling it. What would happen when someone defaulted? The bank would foreclose the loan and sell the house for what they could get to recoup their losses. Since appraisal values are based on what your neighbor’s house sold for, your house dropped in value, leaving no room for you to refinance out of YOUR sub-prime loan, so you would foreclose, causing a domino effect.

Lenders started losing money left and right, and Wall Street caught wind of this, so they pushed the halt button on purchasing these loans which they had previously been packaging up from the lenders and selling them as mortgage-backed investments at home and over-seas. The sub-prime lenders went out of business, along with everyone who had invested in sub-prime mortgage lending. Major banks required government bail-outs to stay afloat and the time-bomb that we had created was felt overseas because foreign economies had made these investments alongside us. The financial system requiring the government to hold it together has caused a behemoth national debt that could ruin the dollar in the end.

Today, we see banks reducing the amount of money they can extend to people starting small businesses or wanting to finance, which has earned the label “The Credit Crisis.”

W. Paul Stogner