Here are a few terms that every college applicant and his or
her family should be familiar with. Financial aid is more than student loans.
It may mean merit aid, loans made to the student at beneficial interest rates,
loans for parents, and what it really means when a school declares it meets all
demonstrated need, or is need-aware.
Less than 1% of college bound HS seniors can foot the bill for college
without loans.
Free Application for Federal Financial Aid (FAFSA): This
document is the jumping off point for all need-based money for college that
comes from somewhere else besides the student and his or her family. Even if
you don’t think you will qualify for aid, this document will allow students to
get federal loans for college not based on need. There is some evidence that
students who don’t need aid but have small student loans do better in school
and are more likely to graduate on time!
Net Price Calculator (NPC): Any school that provides federal
loans to students has to have an NPC page on their website. This calculation estimates
how much a student will have to borrow, or, in the case of a school that has
institutional need-based grants or scholarships to give away, how much that
student will receive, and not have to pay back, ASSUMING THEY ARE ADMITTED.
These calculators start with the Cost of Attendance (COA) and can give
applicants a rough idea of what it might cost to attend.
Estimated Family Contribution (EFC): a fairly complex
calculation that predicts what a family will be expected to contribute to the
cost of one year of college. It is based on parent income, assets, student
income, state of residency relative to taxes and a few other items. The last
year’s tax return for the family is required to complete the EFC
CSS Profile: Another financial aid document that some
schools use that requires more in-depth information and data. Many of the most
competitive schools, those with the greatest institutional aid to give away
(think big endowments) require this document in addition to the FAFSA.
Need-aware: this means a college admissions office takes
into account whether you are applying for financial aid. If you are a full-pay
student, meaning you don’t qualify for aid, and are footing the bill yourself,
you may have a slight edge in admissions at these schools. While it can’t make
up for a low GPA and lousy test scores, it might help if your application hangs
in the balance!
Need-blind: This means a school completely disregards your
financial need when deciding whether to admit you. It doesn’t matter if you
need a full ride, a half ride or a little extra cash. Wait lists are rarely
need-blind; colleges replenish their depleted funds at the end of the
admissions cycle with full pay students from the wait list. If you don’t need
aid, your chances of admission off a wait list are slightly better.
Meeting all Need: a small handful of schools are committed
to meeting all demonstrated need (FAFSA and CSS Profile documents must be filed
in order to have all need met). This means they will foot the bill for anything
beyond the EFC (see above). This means students will
graduate without any debt and why the lowest income student will likely pay
less at a top private than at an in state public U.
Need-blind but not meeting all need: This means that while
the admissions office does not consider need in the application process, the
financial aid office may not be able to defray the cost of attendance enough to
make attendance possible. So you may get in, but the school won't help you foot the bill.
Confused? Lost? Need help? Drop me a note at AthenaAdvisors@optimum.net for a lifeline!
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