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The Process of Applying for Financial Aid (An Overview)
How Aid is Calculated
The process of applying for financial aid all starts with filling out the Free Application for Federal Student aid (FAFSA). For speed and accuracy we recommend filling it out online. When fafsa processes your application an index number called the Expected Family Contribution (EFC) will be calculated with the information you provide on the FAFSA. Keep in mind that the EFC this is not a dollar amount, rather an index number used to determine your financial aid award.
The second number that determines your financial aid package will be the amount of your budget, also known as the Cost of Attendance (COA). Your budget is composed of predetermined numbers for your tuition, books, travel expenses, housing, food, and other miscellaneous expenses.
Your COA minus your EFC determines your eligibility for need based aid such as grants and subsidized loans.
Awarding Aid
1) Once you submit your FAFSA application the Department of Education will process your application and if you have no corrections they will determine an EFC for you and send the results to the schools indicated on your FAFSA. The EFC will determine your financial aid package.
2) Your cost of attendance minus your EFC is your 'need'. The lower the EFC, the more ‘need’ you are eligible for. Your ‘need’ dictates how much 'need based aid' you are eligible for. Need based aid is the Pell Grant, institutional grants, and subsidized loans. If you have no ‘need’ you will at least be eligible for some unsubsidized loans and possibly a parent (PLUS) loan.
3) Once you have a financial aid package you can accept or decline as much of it as you want. Because student debt can be very burdensome in the future, we recommend you only accept what you need and stick to a tight budget while you are in school.
4) Promissory Notes are required for all loans. For Direct Loans you can sign an electronic master promissory note at dlenote.ed.gov. For the Perkins Loan, a Master Promissory Note will be mailed to you once you accept the loan. If you are expecting a refund you must sign up for Direct Deposit.
Sample Aid Package
Sample Expected Family Contributions
| | Buff | Chip | Ralphie |
| Parent Contribution | 0 | 1,000 | 18,000 |
| Student Contribution | 0 | 200 | 7,000 |
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| Total Expected Family Contribution | 0* | 1,200* | 25,000* |
*Note that the Expected Family Contribution (EFC) is not noted in dollar terms. This is because
an EFC is a cost index figure, not a dollar amount.
Financial Need Equation (Resident)
| | Buff | Chip | Ralphie |
| Cost of Attendance | $23,260 | $23,260 | $23,260 |
| <minus> EFC | 0 | 1,200 | 25,000 |
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| = Financial Need | $23,260 | $22,060 | $0 |
Financial Assistance Offered (Resident)
| | Buff | Chip | Ralphie |
| Federal Pell Grant | 4,731 | 3,481 | 0 |
| Additional Grants (State, Fed, CU) | 7,000 | 4,000 | 0 |
| Private/CU Scholarships | $0 | $0 | $0 |
| College Work-Study Employment | 1,800 | 1,800 | 0 |
| Federal Student Subsidized Loan | 3,500 | 3,500 | 0 |
| Federal Student Unsubsidized Loan | 2,000 | 2,000 | 5,500 |
| Federal Parent Loan (PLUS) | 4,229 | 8,479 | 17,760 |
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| Total Aid | 23,260 | 23,260 | 23,260 |
Types of Aid
Depending on what your EFC is, you could receive, loans, grants, scholarships,
or work-study.
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