Longing for debt

Cassandra Kennedy wishes she was tens of thousands of dollars in debt, as long as it meant she could attend college.

Kennedy graduated high school in 2008 with more intent to travel than to pursue higher education. After a few months she decided to look into going to a community college and everything came to a halt.

“I am under 25 and my parents won’t give me their tax information,” Kennedy said.

She declined to elaborate on the situation with why she doesn’t get along with her parents, but it’s because she cannot produce their tax information on the FAFSA that she cannot apply for financial aid. A portion of the FAFSA process requires parental tax information if an applicant is under the age of 25, despite whether they live independently of their parents. Because of this, some people, like Kennedy, hit a road block when their parents refuse to assist.

“I work a full-time job, I live on my own and even with my own credit score I’m untrusted,” Kennedy said.

So while many students groan over their mounting debt to a college, some young people cannot even apply for a student loan.

Kennedy described getting a lot of help when calling potential colleges for information until they realized her dilemma with FAFSA.

“Everything goes great until you hit the FAFSA,” she said.

“Is there any way around that?” Kennedy said to the colleges.

“If you want to pay $300-800 a month.”

“Okay, I can’t afford that.”

“Sorry we can’t help you.”

She did save up money from working, and spent around $3,000 to take two courses at Kaplan University. For Kennedy to take a class again she would need an extra week’s worth of pay each month to cover it, something she said is not viable considering her schedule.

Roberta Johnson, director of financial aid, said there is an appeal process if a student feels they have a special situation and will not be able to get their parent’s tax information.

The person would file a dependency review form for “professional judgment.” Then the financial aid administrator at a school has the power to declare the student independent if they have irreconcilable differences with their parents — but if the officer denies the request there is no appeal.

“Students who are just having a disagreement with their parents are a little more bit more difficult,” Johnson said. “Typically, the Department of Education would not allow us to rule in favor of the student in that particular situation because there’s also always the chance that there’s reconciliation that could occur.”

Students can achieve independent status through a financial aid office, Johnson said, by explaining how they have supported themselves for the past two years or providing documentation from a high school guidance counselor, social service worker or other third party to verify the situation.

Johnson said if there is possibility of reconciliation between the potential student and their parents, an appeal is less likely to be granted. Circumstances to warrant a change tend to be extreme or unusual.

“There are unfortunately some students whose parents abused [them] and that situation is so tenuous we would not want the student to have to go back to visit with them to get parental information,” Johnson said. “I think there’s the fear from people in Congress, and then that goes to the Department of Education, that we could have massive numbers of student who could have disagreements with their parents.”

Independent students are eligible for more financial aid than students labeled as dependent. A dependent student can take out between $5,500 and $7,500 in federal loans each school year considering their year of study. Independent students are eligible for between $9,500 and $12,500 in federal loans.

Johnson said financial aid offices must be prudent with any exceptions made in what’s called an “independent appeal.”

“All these financial aid programs are provided by taxpayer dollars,” she said. “That’s why the Department of Education has been charged with enacting regulatory language.”

Johnson said financial aid offices go through annual audits where the Department of Education will take samples to ensure correct decisions were made. She said her department does attempt to work with the parents and explain the potential benefits for the dependent person and if the parents supply their information. An alternate option, she said, is someone in a dispute with their parents can try finding another family member to co-sign for a private loan.

However, Johnson said a new provision in the FAFSA form allows young people to apply for an unsubsidized Stafford loan by providing a statement from the parent saying they will not provide their tax information.

Not all of those who are able to attend school are happy with the FAFSA process either.

The federal government presumes most students will receive assistance from their parents, be it financial compensation for tuition or providing housing.

Rachel Park, junior in English and theater at Grand View University, said she is frustrated because she lives independently with her boyfriend, her financial aid is dramatically diminished because she is considered dependent of her parents.

Park worked at Dahl’s Grocery Store in Des Moines all through high school. Park was very frugal and saved every dollar she could.

“I never bought anything,” Park said. But the money dried up before her sophomore year even hit.

“I walked into the financial aid office and said ‘the government loans won’t pay for all my schooling and I’m out of my savings, what do I do?’” Park said. She was handed a list of lenders who most Grand View students went through and she went with the name she recognized best: Wells Fargo.

Federal loans are more attractive because they carry low interest rates between 3-7 percent, while private loans often have rates near 15 percent or higher. In addition, federal loans have more repayment and forgiveness programs available.

Parks’ parents made too much for her to receive federal Pell grants, she said. The Stafford loans didn’t cover much, which Park attributes to her father’s tax information supplied in the FAFSA, so she turned to private loans at Wells Fargo. Park needed both of her parents as co-signers.

Park said the FAFSA does not adequately evaluate her situation.

“I find it silly I have to supply my parents’ information, because they see my dad’s income and assume he’ll contribute to my education, but he’s not,” Park said. 

Leisa Whalen, cosmetology student at The Salon Professional Academy, 309 Kitty Hawk Drive, sees an “inconsistency” in the rule.

“If I’m 18 and live on my own without support from my parents, I don’t see why I shouldn’t be able to declare myself independent,” Whalen said.

There are exceptional situations that do not require an appeal for someone under 25 to declare themselves independent, including joining the military, getting married or having a child.

“My cousin is 19 and has two babies and her school is paid for,” Park said. “That’s great for her but I need help too.”

Park’s parents are able to cover the cost of her books, but there’s no way they could have afforded to help with her tuition or living expenses, she said.

“They’ve got a mortgage and bills and my sister’s dance lessons,” Park said. “I don’t blame them for not being able to help me. I mean it sucks but I don’t blame them.”

The U.S. Department of Education did not return several calls.

For the time, Kennedy has turned her attention toward working full-time to support herself. However, she said, the job market is difficult for someone with little more than a high school diploma. Currently she works at the front desk of a Quality Inn and Suites in Des Moines.

It’s frustrating for Kennedy to watch people she hangs out with taking classes.

“I have friends going to school with military benefits, getting $1,000 a month,” she said. “I think, ‘Wow, I could definitely go to school with that.”

Kennedy doesn’t understand the reason FAFSA requires her parents’ information if the federal loans she could take out would not fall back on her guardians where she to default.

“I may not have been the best high school student,” Kennedy said. “But it takes time to turn around, and I guess the past is haunting me.”