All righty, we are on the air. Welcome to another week's episode of College Coffee Talk. Pearl and Andy Lockwood. Hello, Pearl. Hello, Andy. Hello, everybody. Pearl had some getting ready issues today that I think you look great. Thank you. I don't know what your problem is. Thank you. I'm so glad you shared that with everybody. Well, what's your problem? We talk about everything here on College Coffee Talk. First, before any order of business, Sychronized sip of your morning beverage. Good morning. Good morning. Happy Monday. So this is a show about all the latest news about college admissions, college financial aid, what you need to be doing now, et cetera. Stuff seems to be happening at a quick pace. Almost every week there's something new that we didn't anticipate. But there's other things that we did anticipate. One of those is that the digital SAT is finally here in the United States. The first digital SAT will be held on Saturday. I thought they were getting rid of tests. I hear they're coming out with new versions. That's funny. Very funny. A little edgy. A little edgy this morning. Yeah. But I do have some politically incorrect stuff behind the scenes to share about that. So the digital SAT, there are still FAFSA delays. We'll talk about that. Some schools are pushing back their housing deposit deadlines. There's some news about the college essays. And I want to do a little case study of a current client that you are working on with our ā€“ our student loan relief business called Yesterday's Debt. We have a pretty exciting case study, I think, to talk about. And honestly, of course. So let's get into it, shall we? All right. And let's see. If you are with us, say hi in the chat. Let us know that you can see and hear us. Is your phone alive? It is. It's alive and well. So just to give you a little bit of background here, There are very new beneficial repayment plans for loans that are due. Just a little bit on the student loan, parent loan subject. with both student and parent loans, parents are able to borrow, students are capped at what they're able to borrow in college while they're undergrads. They are statutorily fixed at $5,500 in the freshman year, $6,500 in the sophomore year, and $7,500 for each additional undergraduate year one needs to complete. They get $7,500 a year. That is the maximum amount a student can borrow in his or her own name. The parent, on the other hand, is able to borrow either a specified dollar amount for the year. Borrowing takes place annually, by the way, as does financial aid. Or the parent can borrow up to the entire cost of attendance as determined by the school for that year. So that's all in. Room, board, tuition, whole kit and caboodle. Okay. My case study family. My case study family has three children and two are still in college, enrolled in college and have future borrowing to still take place. As of right now, this family's loan balance is $260,000 thus far. which does not contemplate any more borrowing that this family still needs to do, probably as much as what's been borrowed thus far, because their kids are in the earlier years college yeah I think private schools yeah I think to some of you that may seem like a lot of money um to us we see it seems like you see that more often than not that's true yes exactly uh the kids go to private schools meaning private colleges and each year is around give or take eighty thousand dollars or so and then you have multiple kids you get up to that number pretty quickly you have a couple of years where kid decides they don't like the school and then they're transferred. Then you tack on another year of borrowing. See, it all kind of comes together anyway. Well, also in this case, without revealing any conferences, they had a family business and they sold it and they don't have the income that they used to have. Exactly. So now we, so what I'm about to launch into here, if, When it is time to repay back a loan, which takes place, you're not obligated to make any payments until six months after the student graduates. However, there's no prepayment penalty should you wish to mitigate the accruing interest by making payments before that time. Once your payments are due, and for the last several years, people have gotten lulled into a false sense of, oh, we don't really need to pay anything, and it's not really real. I mean, I know we owe because there's been no payments that have been needed, and interest was halted until the suspension was lifted. Okay, so now bringing you to where we are now, there is no more suspended interest. You do need to make payments all the time of year. that has gone by, and now if you have borrowed for college and the student is no longer in school, these debts, obligations, and the monthly payments for them are due now. I thought our president was just wiping everything away, Pearl. I know. That's what he would like everyone to think. But that's not actually true. So in this case... That's rude. Of him? Yeah. In this case... One of their students is completed schooling, so their loan obligation, their loan repayment obligation is upon them. This family, based on this $260,000 that's owed, their monthly payment on that balance that is currently due is $3,140, $3,140 a month. which all things being the same, this 3140 will need to be paid every month for the next 10 years. And they've been paying zero up until then. Well, they'd been paying zero up till then because nothing had been due. So out of the gate, they're all of a sudden they're going from zero to 3000 plus. Exactly. It's a mortgage. It's like a mortgage. And that's where the monthly payment is right now. before all the future borrowing that this family is going to be doing exactly as they have been doing. So that 3,140 is going to climb as they continue to borrow. So what are the possibilities? What am I doing for this family? With the available income-based repayment plans, this family with a lot of movement, because unfortunately, No plus loan on its own is eligible for the loan repayment plans based on income. None, none. So that every parent has borrowed cannot just say, oh, I would love to just get into that income-based repayment plan. I'll just check a box here and then I'll be in it, right? No, there are multiple hoops and things that have to happen that you would not necessarily otherwise know about, and nor would a loan servicer be competent to really instruct you on exactly what has to be done. Even if you did an A consolidation, that wouldn't accomplish changing the character of the loan from the plus loan into a direct loan, which then makes it eligible for these income-based repayment plans. Let me land the plane here with my case study. My family, my, This borrowing family currently facing $31.40 a month of monthly payments. Their income, as Andy discussed, they sold the business, their income, they're retired. Their income is at a place, it's very low. So I broke the news to this family that their new monthly payments, once I get through doing what's called the double consolidation, and there are a couple other things that have to happen, but... But in order to- It's like a triple Lindy. It is like a triple Lindy. Once we get through the triple Lindy, their payments, ready for this? Drum roll. Where's the band? Cue band. Zero. Zero dollars. Okay, what? Now I'm going to tell you something even crazier. And when they continue to borrow and their loan balance jacks up, oh, are their payments going to change then? No. No. because the income-based repayment plans are not based on your loan balance like the ordinary loan is if you do nothing to it under the standard repayment plan. As your loan balance increases, so will your monthly payments. Because this is an income-based repayment, it is irrelevant that the loan balance continues to grow because the repayment is tied to that income, that income which gets recertified every year until this payment is done. So in this instance, we're converting their loan into the save, ultimately to put them into the save plan, which is currently the most beneficial of these income-based repayment plans that are out there. Why is it the most beneficial? Because the save plan is the one plan that doesn't have what's called negative amortization of the loan as the time goes out and you continue not to pay the full amount on the loan. What happens to all other loans is the balance increases because you have not been paying down the loan, the principal. So your balance is continuing to increase even though you are considered in good standing because under the income-based repayment plan rules, your income... is tied to, I'm sorry, your repayment is tied to that certified income for that year. So as long as you are able to have somewhat control over that income for that borrower, then, and I'll get back to that in a moment. There's a lot here. May I? Yeah, sure. There's a lot here. I love when you do both sides of the conversation, like you're asking your own question. I'm anticipating. Yeah, okay. So we have a lot to get through today. So the bottom line is there's something like 125, 160, something different scenarios. Yeah. Okay. So Pearl's an expert on virtually all those scenarios. And within the letter of the law and the confines of these programs, you've helped a handful of clients already. We haven't really been advertising this business at all. Uh, chop their payments from like 3000 to less than a thousand. And in this case to zero to zero. So if you have, um, student loans or parent loans, how do people get in touch with you? You want to put it in chat? It's a yesterday's debt, right? Yesterday's debt.com. Uh, good morning to Kevin Casey, Pino loving Burke. Hello, Demetra. Hello to Chris Katch. Good morning. And a bunch of other people. Don't be shy. If you have a college-related question, pop it right there in the chat, and we will get to it, time permitted. But we've got to move on, Pearl. That was ā€“ unless you want to do the whole thing again. No, no, no. That's okay. The bottom line is I think you got the gist. And we will do a webinar that is more comprehensive on the loan repayment possibilities. repayment plans, et cetera. But basically bottom line here, I took this family who was facing from minute one, $3,100 a month in loan repayments only increasing. And now it's going to be zero, zero a month. It's also, there's more to it, but yeah. I was also talking to a prospective client this weekend, and it's also a good idea to get a handle on these loan repayment plans before you start borrowing. Exactly. Pick the right borrower. Yeah. All of it. There's a lot of moving parts, but you can be smart about it and plan accordingly. Yeah. So a lot of people have already borrowed, and they don't even know how much they've borrowed. Right. And then there's people who are trying to avoid it, but will be borrowing something, and it's very helpful for them to get a proactive look also. All right, so digital SAT, the first one in the United States, is happening this Saturday. Over the last week, I've covered in my emails a little bit of the changes in test optional because a lot of people say, should I even take the SAT because most schools are test optional? And I've always said consistently, like, look, There's a difference between applying test optional and getting in test optional. So even in states like California, where all of these state universities, the UCs, and I think the Cal States are test blind, they still look at test scores for scholarship money and for placement in your college courses. If you score high enough, you place out of certain introductory classes. So everyone should take the SAT or the ACT. And the other question is, well, you know, look, my kid is a great student in high school, but she doesn't test well at all. Like they're so unfair. They don't really indicate, you know, how well someone's going to do in college. Well, recently schools such as Yale and Dartmouth, but not only elite schools, Georgia Tech, Georgetown, I mean, those are, you know, top schools. They have reversed their test optional policies and now are requiring tests because they said two things. Number one, they happen to be very predictive of how well students will do in college, more so than their high school transcripts because of grade inflation, because 47% of students have A averages. 47%, almost half. You must be all so smart these days. Right. There are no more C averages. So I point this out. Oh, I'm sorry. And the other reason is that contrary to what critics of the testing like FairTest.org say, what the Dean of Admissions at Yale pointed out was that the test optional policies decreased diversity because many diverse under-resourced kids were not submitting their scores under the mistaken belief that that would hurt their chances of getting in and And instead, what the admissions officers were doing when someone doesn't submit scores is looking at everything else, including inflated grades and lack of extracurricular activities for under-resourced families. So in contrast, and this is sort of a Freakonomics counterintuitive result, but in contrast to what the critics of the test were positing, it seems like diversity actually decreased at a lot of these colleges because of the test optional policies, not the other way around. So that was kind of interesting. I got a few comments back on some of the emails that I sent this past week. And one of them was along the lines of, well, I went to a top school. I was valedictorian. And I didn't take the back in the day. And I didn't have good scores. I was like, well, first of all, back in the day, there wasn't this rampant grade inflation, right? You would be called a teacher's pet. Oh, no. I mean, I'm sure she was a good student and all that. That's great. But that doesn't take away from what Yale and Dartmouth and MIT and a bunch of other elite schools have found, which is that the tests today are predictive mostly because of this rampant grade inflation, where, again, almost half students in high school have A averages, believe it or not. Pretty ridiculous. Yeah. So we have courses that are not to prepare for the, we don't have any cram courses to prepare for the Saturday SAT, which wouldn't really work. But we have other classes starting tomorrow, actually, for the ACT. So what we recommend for every kid is you figure out which one is best because colleges will take either. We help you do that if that's something you need help with. Yeah, you take a diagnostic. You need help with that because you can't figure that out without doing a diagnostic. Exactly. And then you just get your score as high as you possibly can get it and then you're done. And that usually takes two or three times. Shouldn't take much more than that. There's a point diminishing return if you keep taking these tests. Can you pop in LockwoodTestPrep.com and coupon code is CRUSH2024. to get $100 off of our upcoming ACT test prep. Crush 2024, 2024. All right, just briefly, a handful of more schools delaying the housing deposits this year because the FAFSA data for students won't even be downloaded until sometime this month by colleges. So traditionally, all the deadlines, a lot of priority deadlines for colleges were November, December, and so forth. This year, because of the massive seismic overhaul of the FAFSA, everything's been delayed. So what that means is it's going to be harder for people to evaluate their financial aid awards because they're not going to get them until later in the traditional timeline. So what colleges have started to do, in turn, is to push back their housing deposit deadlines from May 1 to May 15 to June 1, and we'll see what happens. So if you're a class of 2024 family, you're not going to have all of your financial aid awards probably until April. But you'll have a few extra weeks to be able to figure out whether these schools are going to be affordable or not to negotiate with them. I'm in the middle of a negotiation right now that I'll just talk about briefly. I don't know how it's going to turn out. But Murphy's Law is a pretty common thing in college financial aid. What I mean by that is this particular student, her name is Shannon. She got on to, I think, eight or 10 colleges. And of course, the one she wants to go to the most is the one that gave her the least amount of money. But I would say that if you looked at the, I don't know if you saw this, but if you looked at the colleges that she applied to, they're all sort of in the same wheelhouse. So they do compete with each other. But her top choice school gave her an okay award, but the out-of-pocket is going to be in the 50s. Whereas the other comparable colleges were somewhere in the low 40s and even some cracked into the $30,000 net price range, which is a pretty significant discount. yeah, most of them are in the low 40s, but there's a pretty wide, you know, delta between our top choice school and all the other ones. So what we're trying to do is say, look, you're my top choice school, but these other colleges gave better offers. We're only considering these out of financial reasons only. So if there's any way that you could, you know, match, you know, we're coming, basically. So we'll see what happens, but sometimes that works. It works especially well when you have colleges that compete with each other. So we're not going to play off an Ivy League against like, you know, whatever, Big Al's Air Conditioning Emporium. Trade school. Trade school, right. So stay tuned for that. But the best defense against college costs is a good offense by making sure when you finalize a college list, which is typically over the summer for rising seniors, we always, when we work with kids, we like to make sure that we have some colleges that compete with the top schools on their list just for this purpose, just so we can play them off against each other. So we'll see. Yeah, exactly. All right, the college essay prompts. The common application just announced the other day that the essays will be the same as last year, so the same questions. There are seven choices, including one that I always say don't even think about touching, which is the write whatever you want question. Just don't do that one. That's number seven. So there's really six essay prompts. My advice for everyone on the essays, and we'll probably do a separate workshop on this, a webinar, is you got to get them done over the summer. We had too many kids this year who were just dragging, but even until December, some even past January, who were seniors. I don't know how it happened. Well, I know how it happened. They didn't do their jobs. But you need to really get them done over the summer so you can actually focus on other stuff in the fall, like school. That still matters. It's a big misconception that the fall senior year doesn't count. It does. Almost certainly sometimes admissions decisions will turn on that fall senior year semester. The schools will reach out to the guidance counselor and ask for those mid-semester grades. Especially if you get deferred or you get waitlisted. I mean, those grades are on the record. so um you need you need we've seen kids who you know were waitlisted and didn't get in and their grades dropped I don't think it was a coincidence right we've seen that numerous times over the year yeah um so if you have a rising senior one thing you should look at is our boot camp if you could post that please uh you're busy lockwoodcollegeprep.com bootcamp and um we're still taking 500 off for anyone who does the early action enrollment um It's free. If you're a one-on-one college advisory client, it is included in your package. But to people who are not yet clients of ours, this is probably the most focused way. It's a group thing. It's not a one-on-one thing, but it's the most focused way to get all your applications and essays done. It's a combination of instructional stuff and working sessions that stretch from the end of June all the way through September. There are... five work blocks that are on Sunday mornings, two in July, two in August, and one in September. I'll be adding that one. And it's just a great way to make sure you are giving yourself the best shot at getting into the colleges that you want to get into. So many kids blow it off, and then they rush their applications in. They rush to their essays. They don't even know what the hell to write about on their essays. You know, we know. We have former admissions officers who work for us. It's no mystery what admissions officers are looking for in these essays and these applications. And we help with the college list, too. Are there any questions coming in? There are. So why don't I stop here and then take some questions, and then we'll wrap it up. All right. All right. Question from Michelle. In regards to financial aid, is our financial aid appeals course still available? Yes. Okay. And I think that is LockwoodCollegePrep.com. Okay. Your thumbs are so busy. Yes, busy thumbs. Okay. And the next question is from Janine. My child is going to be applying for 2024 when he's a senior for admissions in the fall of 2025. class of 25. Do you think the SUNY schools will still be test optional for admissions? I spoke to SUNY Cortland. They said it's going to still be test optional. I spoke to Geneseo. They said it will still be test optional. SUNY Oneonta said test optional for admissions till spring of 2025. Do you think Oneonta could change that and be test optional for admissions for the fall of 25? Well, I think it's unlikely. I think they will be test optional if I had to guess. But again, Sometimes these schools require tests to see if you can place out of certain classes, and sometimes they do it for merit aid consideration. And, you know, maybe your kid will want to apply to some other schools, too, besides these SUNYs. So I would still take the test and get them as high as possible. And then you decide, you know, on a game day basis, school by school, which ones to submit to and which ones not to. And just have an understanding. If you're applying to not a test blind, but a test optional school and you're opting not to submit scores, the inference on the other side is that you did not hit that minimum range that's at that school. And that's why you didn't submit them. So just have that understanding while you opt not to. Right. It's not because they're too high and you didn't want to show up. Right. Casey, if you have money saved in a 529, will that count against you when applying for merit money? No, it will not, my friend. It will not. No. Okay. Sorry. He's a big pickleball guy. Cool. That's neat. Um, Michelle, great. Thank you. Should I apply? Should I apply for the appeals course now? Wait, wait till we get my daughter's merit aid estimate from her preferred school Hofstra. I mean, either way, you know, there's, there's, uh, there's no rush to do it. So yes, if you're ready, uh, if you want to just, you know, get all the information down and have a leg up on it, that's probably maybe a little better if you're thinking about it, but there's no, it doesn't matter. You'll still get the same information. Betsy, our kid took the PSAT in her sophomore year. Should she take the PSAT again her junior year? Well, so there's two reasons to do that again. One is that if she does well enough, she could be a national merit scholar, which is awesome if she's a good test taker. The second thing is it's like a scrimmage for a sport or a dress rehearsal for a play or something. It's just more reps and more practice. So I would definitely do it. I think that's it. You want to do traffic and weather? She did. She earned national merit. Traffic and weather. She earned it already. It's not as nice today as it was yesterday. She already earned a 10th grade? The 11th grade one is the one where you can get the national merit. The PSAT person. Well, if you already have national merit, then I wouldn't keep taking it. Right. But it's for 11th grade. The 11th grade test is the one that has national merit. I've got one more question. Okay, and then we'll wrap up. Awesome, on time today. From Janine. What are some SUNY schools that are good teaching and some private schools that are good for teaching? So that's a longer answer, right? But the thing with teaching is that you can really major in anything and then get a teaching certificate and then you're qualified to teach. We see a lot of teachers who go to Portland. Yes, that's true. I think that's got a very good reputation. And the private schools are, I kind of feel funny about those for teaching because they're so expensive. Right. So unless you're going to go to a school that's going to give you a significant discount, I don't know if I, and if you know for sure you want to be a teacher, I don't know if I would even entertain going to a private college like Columbia Teachers College because it's three times the cost of a Cortland or any other SUNY and you're going to end up in the same place with the same salary. Your income is not going to be three times as great. Yeah. But I think a good place to start is asking your current teachers that you like, that you think are smart, like where they went to school. Most of them probably didn't get a teaching degree from high school. They may have just majored in history or something and then got a certificate afterward. So it's really all about getting a good education wherever you go and going deep into your subject that you ultimately want to teach. But yeah, I think Cortland is probably the number one SUNY that we see for teachers. Agreed. Yeah. All right. That was cool. We're on time here. So thanks for joining us. Pearl, any closing comments? We appear here every Monday at 10 a.m. And if you think of questions that come upon you during the week, jot them down and have them ready for next Monday. Or pop them in the comments here. We actually did get a question last week, which we didn't have time to answer. It was about a special type of Roth IRA. So that is on the docket for next week. All right. All right, guys. Thanks for joining us. Have a great week.
