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Financial Aid
THE FACTS ABOUT STUDENT FINANCIAL ASSISTANCE
Do millions of dollars for scholarships go unclaimed every year? If you believe that, you probably also believe you're going to win the lottery next week. The FACT is that millions of students scramble for grant aid each year...most will have to borrow...some must forsake their college of choice...others may even postpone college because of insufficient resources. It is important that students and families plan early for college costs. If college enrollment is imminent and you and your family do not have the resources to meet college costs, you should read on.
THE BASIC FACTS OF STUDENT AID
- Students receive financial aid from a remarkable array of sources, you may apply for assistance from the federal or state government, local banks, civic or church groups, your parents' employer or union, and colleges themselves.
- The beginning of your senior year in high school is the best time to start inquiring about financial aid. Your best sources of information are the financial aid officers at the colleges you wish to attend.
- As you request catalogues from colleges, also ask for a financial aid application and any related information. Apply even if you think you will not qualify. Most important, apply on time and complete accurately. College funds are limited; a late inquiry or error could lessen your chances.
The Three Basic Facts About Student Aid
- Grants and Scholarships: outright gifts of money that don't have to be repaid.
- Loans: borrowed funds that usually must be repaid with interest.
- Part-time jobs: opportunities provided by colleges to work and earn money.
Student Aid often is a combination of all three, known as a "Financial Aid Package." The amount of your package depends on your financial need. Most federal and state aid is awarded based on financial need rather then academic merit; your financial need is determined by the information contained on your FAFSA.
FACTS ABOUT THE FAFSA
All colleges will ask you to file a FAFSA. FAFSA stands for "Free Application For Federal Student Aid." You must complete a FAFSA to apply for state and federal financial aid. The information contained in this application is used to determine your eligibility. Send your completed FAFSA to the needs analysis service or fill out an application online at www.fafsa.ed.gov, as soon as possible after January 1st, or by the college's financial aid deadline - whichever is earlier.
The needs analysis service will review your FAFSA. Based on this analysis, you will be assigned an "Expected Family Contribution" (EFC) which is the amount you and your family will be expected to pay toward college costs. The EFC is used to determine your need for financial aid.
In early November De Smet will host a College Financing Seminar(Financial Aid Night). Check the calendar of events for the exact date of time.
DEFINING YOUR FINANCIAL NEED
The needs analysis considers your parent's income, your earnings and sometimes your family's net assets (real estate, cash, bank accounts, trust, investments) to determine your EFA. Home equity, which at one time was a factor, is no longer considered in the needs analysis calculation for federal and state aid. Home equity may, however, be considered by the college in determining your eligibility for institutional aid.
The needs analysis also takes into account family expenses. These include income taxes paid, housing, clothing and food cost, number of family members, number of household members in college or vocational school, and parents' need to save for retirement.
The colleges to which you apply will review the results of the needs analysis to make a final determination on how much you and your family are expected to contribute toward your educational costs. Your financial need is determined by subtracting your expected EFC from the annual costs of your education.
To meet your determined financial need, the college may include various types of aid into a financial aid package. This package may include grants, scholarships, a part time job and loans. If your award includes a Stafford Loan from the federal Family Education Loan Program (FFELP), you will need to complete a separate application.
Some colleges require you to complete forms in addition to the FAFSA, some of which carry a fee. Usually these colleges provide large amounts of institutional aid. They need additional information for a more accurate picture of family financial circumstances. This form is called the CSS/FINANCIAL AID PROFILE. You can register for your personalized PROFILE application via the Internet: www.collegeboard.com.
Within four weeks after mailing the FAFSA, you will receive a Student Aid Report (SAR). This report gives information on your eligibility for a Pell Grant. Read it carefully. When you make your final decision on where to go to college, forward a copy of the SAR to your college. The college will use the information on the SAR in deciding whether to include a Pell Grant in your financial aid award, if you are eligible.
FACTS ABOUT LOANS
If you intend to borrow from a federal student loan program to finance your education, consult with your college aid officer to determine the application procedure at that particular college.
The most attractive educational loans are those targeted to financially needy students. These loans - Stafford Loans and Perkins Loans - require no interest or repayment while the borrower is in school.
Students who do not qualify for need-based aid also have a borrowing opportunity available in the federal Unsubsidized Stafford Loan Program.
Loans to families of college students are available in the federal Unsubsidized Stafford Loan Program.
Parents also may borrow through the federal PLUS Loan Program and a variety of supplemental educational loan programs which your college aid officer can tell you about.
As with any loan make sure you fully understand the interest rates, repayment terms and tax implications. Find out whether interest charges are variable or fixed, whether the loan has forgiveness or deferment provisions, whether you can consolidate the loan with other loans and whether it carries prepayment penalties. Borrow only what you need. Remember that loans must be repaid even if you do not finish college.
SEVEN (7) FACTS TO REMEMBER
FACT #1: The amount of financial aid for which you will qualify is determined by your financial need. Though your estimated family contributions will usually remain the same from college to college, your financial need will increase or decrease depending upon the costs of the college.
FACT #2: Your need for financial aid will be more at a higher cost college than at a lower cost school. However, this does not necessarily mean that the higher cost college or the lower cost college will be able to provide you with financial aid that is sufficient to meet your financial need.
FACT #3: Colleges handle "outside scholarships" differently. In some cases, an outside scholarship will not impact your college aid package; some colleges will reduce your loan portion of the package by the amount of the outside scholarship and others will withdraw institutional grant aid by the amount of the scholarship.
FACT #4: You must apply for aid each year. Your family's federal income tax return should be completed early, allowing you to complete your FAFSA as accurately as possible.
FACT #5: If your family's tax return cannot be completed early, this information must be estimated on your FAFSA. If you must estimate, do so carefully. You may be required to submit an actual copy of your completed tax information later. If your estimate is off-base, you may have to correct the information on your application - possibly delaying your financial aid award.
FACT #6: Contact all colleges to which you are applying to learn about financial aid deadlines.
FACT #7: College is a substantial investment, but it's the most important investment you can make in your future. Take time to learn all of your financial aid options before you make any college decision. College financial aid officers can help you find ways to pay for your education.
A SPECIAL NOTE: Some colleges require that an additional financial aid form be submitted to help in the determination of a financial aid package. This is called the CSS PROFILE. This form is available in the College Counseling Office and should be completed as soon as possible. It can be submitted before January 1st. This application can also be obtained via the Internet: www.collegeboard.com.
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