ROHNERT PARK, Calif., March 30, 2018 /PRNewswire/ -- A lot of attention is placed on whether low-income families can afford college, but what about middle-income families? Pell grants, tuition discounts and other need-based aid goes a long way to help low-income students attend college and get a shot at social mobility. However, middle-income students may benefit just as much from need-based aid that they currently are not eligible to receive. Ameritech Financial, a document preparation company that assists borrowers in applying for federal repayment plans, reminds borrowers that if their student debt burden is too high, they may benefit from income-driven repayment plans.
Middle-income families find themselves in a strange position when it comes to funding college: they make too much money to qualify for need-based aid but not enough to cover the full costs. Therefore, those students must rely on loans, both federal and private.
"College is expensive and even the middle class may have trouble paying for it," said Tom Knickerbocker, executive vice president of Ameritech Financial. "Those students may end up taking out loans to cover the full cost of college, which can put them in a worse situation than their low-income peers."
An important part of financial aid awards is the Expected Family Contribution (EFC), which is an amount the federal government thinks a family can contribute to the student's college expenses. The government awards need-based aid to families with low EFC amounts. Because middle-class families are more likely to own houses or have more money in their bank accounts, that EFC will be higher, often pushing them above the need-based threshold.
However, not all parents choose to help their children through college and, in fact, many financial experts advise parents to focus instead on their own retirement funds. That could result in students needing to take out additional loans to cover the EFC amount. To address such parental decisions, this article suggests that financial aid consider how much a family will actually help a student, rather than how much they are able to help.
Regardless of the why behind high debt balances, borrowers who are struggling to pay them back may have options. The Department of Education offers several repayment plans for borrowers who cannot afford the standard plan payments. In particular, many borrowers find income-driven repayment plans (IDRs) to be valuable in that they base payments on income and family size, which can reduce payments and ease the financial strain on households.
"It doesn't matter what income bracket they come from. If borrowers are having trouble paying down their debt because their income isn't high enough, they may need help understanding federal options," said Knickerbocker. "At Ameritech Financial, we help borrowers who may be struggling to make their federal student loan payments apply for IDRs and we also assist with annual recertification paperwork as long as they wish to stay in the program."
About Ameritech Financial
Ameritech Financial is a private company located in Rohnert Park, California. Ameritech Financial has already helped thousands of consumers with financial analysis and student loan document preparation to apply for federal student loan repayment programs offered through the Department of Education.
Ameritech Financial is a member of the Association for Student Loan Relief (AFSLR), and each representative on the phone has received the Certified Student Loan Professional certification through the International Association of Professional Debt Arbitrators (IAPDA).
Ameritech Financial prides itself on its exceptional customer service.
To learn more about Ameritech Financial, please contact:
5789 State Farm Drive #265
Rohnert Park, CA 94928
SOURCE Ameritech Financial