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Case
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The following case
studies illustrate how need-based financial aid and
long-term payment options work together.
Penn cannot guarantee that every student whose family
feels they resemble one of these case studies will
receive a similar aid package. These case studies
are examples only.
1. MARGARET lives
in California with her parents and younger brother.
Her parents' total income is $78,000. The family
has $107,000 in home equity, and $10,000 in savings.
Margaret has $2,500 in assets in her own name.
Penn calculated that Margaret's parents
could contribute $9,150 towards education for the
current year. Margaret is expected to contribute
$2,330 from both her assets and summer earnings.
The total family contribution is $11,480. |
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| Educational Expense Budget |
$49,080 |
| Less family contribution |
- 11,480 |
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| Penn Grant |
$28,300 |
| Federal Work-Study Job |
2,650 |
| Federal Stafford Loan |
3,500 |
| Federal Perkins Loan |
3,150 |
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| Margaret's
parents intend to apply for a home equity
line of credit to finance most of their parental contribution.
They opted to apply once for a $46,000 line of credit
for Margaret's four years at Penn. Repayment can extend
up to 20 years at a competitive rate. Monthly payments
will vary, depending on the amount drawn against the
line each year. |
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2.
NICOLE'S father
is deceased and her mother earns a modest income
to help support a family of three children in Pittsburgh,
Pennsylvania. Her total income, including social
security benefits for the younger children, amounts
to $37,400. Penn expects Nicole's mother to contribute
$300 and Nicole to contribute $300 from her summer
earnings. She has no prior savings. |
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| Educational Expense Budget |
$49,080 |
| Less Family Contribution |
-600 |
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| Penn Grant |
$46,130 |
| Federal Work-Study Job |
2,350 |
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| 3.
ROY and
his younger brother live with their parents in the
mid-west. Roy's parents earn $62,000 and have $7,700
in savings. In addition, they have $105,000 in home
equity. Roy has no accumulated savings. Penn expects
Roy's parents to contribute $5,150 and Roy, $2,200
from summer earnings. The total expected family contribution
is $7,350. Because of Roy's exceptional academic credentials,
he was selected as a Trustee Scholar. Trustee Scholars
receive packages that meet their need without student
loans. |
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| Educational Expense Budget |
$49,080 |
| Less Family Contribution |
-7,350 |
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| Trustee Scholarship |
$38,780 |
| Federal Work-Study Job |
2,950 |
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Roy's parents
chose the The Federal PLUS Program to finance
their $5,150 parental contribution for Roy's freshman
year. Monthly payments will be $64* for ten years.
*assumes an interest rate of 8.5% and a 10
year repayment term |
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4.
KRIS lives
with her parents and brother in suburban Chicago.
Her parents are teachers, and together earn $138,800.
They own a home with $120,000 in equity, and have
$40,000 in savings. Kris has $1,500 in savins. Penn
expects Kris' parents to contribute $25,400 and Kris
to contribute $2,280 from her summer earnings and
savings. |
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| Educational Expense Budget |
$49,080 |
| Less Family Contribution |
-27,680 |
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| Penn Grant |
$16,100 |
| Federal Work-Study Job |
2,650 |
| Federal Stafford Loan |
2,650 |
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To assist
them with the parental contribution of $25,400, Kris'
parents combined two payment options. Through the Penn
Monthly Budget Plan, they budgeted $10,000 over
ten months; their monthly payment is $1,000. They borrowed
the remaining $14,200 from the Federal PLUS Program;
monthly payments are $191* for ten years. Kris' parents
pay a monthly total of $1,191 for Kris' first year
at Penn.
*assumes a fixed interest rate of 8.5%, effective
7/1/06 |
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5.
ERIC lives
with his parents and younger sister; his parents'
combined income is $110,350. They own a home in New
Jersey with $85,000 equity and have savings of $27,000.
In addition, Eric has $2,600 in his savings account.
Penn expects Eric's parents to contribute $16,950
and Eric to contribute $2,300 from his savings and
summer earnings. The total family contribution for
the academic year is $19,280. |
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| Educational Expense Budget |
$44,080 |
| Less Family Contribution |
-19,280 |
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| Penn Grant |
$20,500 |
| Federal Work-Study Job |
2,650 |
| Federal Stafford Loan |
3,500 |
| Federal Perkins Loan |
3,150 |
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Eric's
family elected to combine the Penn Monthly Budget
Plan with the Federal PLUS Loan to pay their parental
contribution of $16,950. They budgeted $6,000 through
the ten-month Budget Plan with a monthly payment
of $600. After financing the remaining $10,950 through
PLUS with a $136 monthly payment*, their total monthly
payment for Eric's first year at Penn is $736.
*assumes a fixed interest rate of 8.5% and a 10 year
repayment term |
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6.
WILLIAM lives with his parents and two
sisters. His father's annual income is $170,000
a year. They have $390,000 of equity in their home
and $100,000 in assets. William's parents have
saved $55,000 for his education, William has saved
$20,000, and his grandparents have contributed
$30,000 to an educational savings plan for him.
Because the amount William and his family are expected
to contribute is greater than William's educational
costs for the academic year, he is not eligible for
need-based financial aid. However, if William files
a financial aid application, he is eligible to borrow
$3,500 from the unsubsidized Federal Stafford Loan
program and $3,000 from the Penn Guaranteed Loan
Program, with the option of deferring repayment until
after graduation.
William's family has elected to participate in the
Tuition
Stabilizer Plan. They will prepay 4 years of
tuition and fees at the current rate to avoid future
tuition increases. |
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