Questions and Answers

1.  Why should I use the Zero College Debt Program when I can buy property myself?

Answer:  Yes, you can buy property yourself, but this program provides you with support, benefits programs, all the forms you need to lease property including advice on the maximum rents for the market and much more.  You will have the opportunity for promotional programs and a list of preferred vendors in each market.  There will be three contacts in each market to help you with any problems that you may run into.  This program also offers your child ongoing educational opportunities to help in managing the property and other topics like money management and more.  Also, there are no additional fees for working with Zero College Debt Program other than the yearly $25 membership fee/ student.  With this membership, you get a full financial and market analysis of the college town of interest.

2.  How does financing work on this type of loan, non-occupying borrower?

Answer:  See the rules on non-occupying borrowers under the FHA information provided in the FAQ section.(Loans with your children.)

3.  I'm concerned that my child is not mature enough to manage this type of investment.

Answer:  We understand your concern.  We recommend that you set up a business checking account that is controlled by the parents.  Then have the rents deposited directly into that account.  The parents can pay the monthly bills, college expenses and pay your child a monthly allowance each month from the business account.  This also helps you keep track of all the expenses for tax purposes.

4.  I don't think my child is ready to deal with renters and maintaining control of a house.

Answer:  Part of our reasoning for not recommending the purchase of a home in the first year of college is the adjustment your child will go through in the first year after leaving home.  By their sophomore year, they have gone through these adjustments and are more independent.  You and your child should develop a strategy and business plan together.  Our program will work with you to develop resources to assist you and we also provide a support network to assist your child after the purchase.  You know your child best but we will have ongoing educational opportunities to assist them.  At any point in time, you can recommend a topic and we will try our best to bring that educational opportunity to them.  Ultimately, the decision is between you and your child.  By developing a good business plan, regular review processes and accounting controls, you and your child can develop a strategy to avoid years of servitude to paying back college loans.

5.  Why should I attend a seminar when there is so much information on this site?

Answer:  You will get a lot of additional information by attending one of the national seminars.  We will try to have a CPA and an NICCP member present to help you understand all the tax advantages and strategies available to you.  We want you to have as much information as possible to make your decisions and we have attempted to bring together a team of people to help give you answers and make the process easier to understand.

6. How do I find out about Residency Requirements and qualifying?

Answer:  We will provide you with resources to answer these questions.  Each state has different requirements.  There are also tax implications involved so it is important to get all the answers to questions before you make a decision.  By attending one of our national seminars, you will get answers to these questions and it should help you to understand the program better.

7.  Does my child need to have a credit rating?

Answer:  FHA requires all borrowers to have a credit score (typically 580-620 minimum) or 12 month non-traditional credit history even when a non-occupying co-borrower is the main person qualifying for the loan.

Recommendation:

Get a Visa and a $500 installment loan paid back in $100 increments….just fast and easy to get….usually can get a score within 90 days.

We are providing this advice to all prospective students who are interested in the program.

8.  I am married and I am not interested in having renters in my home.  How could I use this program to help me? 

Answer:  Glad you asked that question.  In the case where you do not want renters in your home, we will locate a four-plex (an apartment complex with four units).  You live in one and rent out the others.  The same REALTORS sell these properties as single family residences and the contract is the same.   The mechanism set up in the program is the same.

9.  I purchased a home that qualifies for the first-time homebuyer credit. I will be renting two of the bedrooms and reporting the rental income on Schedule E. Will I still qualify for the credit if I use the home as my principal residence?

Answer: Yes, if you meet all first-time homebuyer eligibility requirements. See Form 5405, First-Time Homebuyer Credit, for more details. (Answer came directly from the IRS web site).

10.  Is there any advantage of using the Zero College Debt Program when I am ready to sell?

Answer:  Yes, if your property is sold through this program, you will have a full service broker  to advise and support you.  We will have a list of new students looking for this type of investment so the sale will probably happen faster.  Our goal is to sell your property in 30 to 45 days.  Current market conditions apply.

11.  I see that you recommend I get an inspection before listing through Zero College Debt.  Why is this necessary?

Answer:  Yes, we recommend that a property inspection be done to make sure that the home is ready for sale.  This will be a nominal expense to you, but it also qualifies you for a Home Warranty program which will cover any major repairs during the listing period.

12.  Why do you recommend we get an appraisal before listing with Zero College Debt Program?

Answer:  It is our goal to sell this property as quickly as possible.  The hardest part of selling your property is properly pricing it to move it quickly. The appraisal will also make sure that when you get an offer, it will qualify for financing.

13.  What other strategies can I use in helping to finance college?

Answer:  In order to provide our clients with as much information and help as possible, The Zero College Debt Program and ZCD Properties has entered into a relationship with the National Association of Certified College Planners (NICCP).  This group has specialized programs to assist you in understanding strategies like using pre-tax dollars, understanding the loan processes, scholarships, etc.  See some of the webinars they are making available to our members under the Education section on this site.  Members from the NICCP will be presenting at our local seminars.

14.  Who needs a Certified College Planning Specialist?

Answer:  Approximately 13 million families could use the help of a CCPS.

Consider these facts:

The average yearly cost of a public university is $16,000
The average yearly cost of a private college is $32,000
The average yearly cost of an elite private college is $48,000

These college costs are generally paid for with after-tax dollars, which means that the IRS gets their percentage before the college gets their tuition payment. In the 28% tax bracket you must actually earn $18,655 to pay the public university $12,500. Remember that this is ONE year’s cost for ONE child. (excerpted from the NICCP web site). 

There are approximately 17.5 million graduate and undergraduate students that can be assisted by the Zero College Debt Program.

Income – Support – Benefits – Real Life Learning System™