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What is financial aid?

Financial aid is money used to pay for college that does not come from the student or family when they are paying the tuition bill. This leaves two other possible sources for paying the tuition bill. The first is money that comes from grants or scholarships. This is free or gift money used to pay the tuition. The second source is money that comes from the student or the family at a later time. Colleges will often refer to this kind of college financial aid as "self-help" aid. This is what the rest of us call loans or jobs (work-study.) College financial aid refers to both gift money and loans. Find out more about financial aid. Link Test

What is merit aid?

Many schools, public and private, offer merit aid that is given to students based on their academic qualifications or ability to meet some desired outcome. By analogy, this would be considered in line with a traditional scholarship, that because a student does ‘X’ exceptionally well, the school will give them ‘Y’ (hence, merit). A good example of this is the University of Alabama, which offers a full tuition scholarship to students who have scored over a 32 on their ACT along with having over a 3.5 GPA. Merit aid may be automatically awarded or applied for through separate applications. Make sure you know whether merit aid is offered at your school so that you don't miss the deadlines – usually accessible through the financial aid portion of a college’s website.

What is needs based aid?

Need aid is given by a university to ensure that a student can attend. Some schools, especially private colleges and universities, will note that they meet students’ financial needs through need-based aid, meaning that if you are accepted to that school, the school will assess your need through financial statements, usually submitted through the CSS/Financial Aid Profile, and will fully provide the aid that you’re deemed to need. Be cautious, though. Definitions of ‘full need,’ however, vary dramatically per school. Luckily you can get an assessment of how much they cost through a need-based calculator, covered later in this guide. Many of these schools also employ ‘need-blind’ admittance, meaning that the school does not weigh your ability to pay for tuition in the application process. Need-blind financial aid packages also assume that you’ll be working over the summer and school year and factor those earnings into their award amounts.

What is a net price calculator


What is my expected family contribution (EFC)?


What are Direct Student Loans?

Direct student loans, also known as Stafford Loans are subsidized government student loans that your FAFSA financial aid report will determine whether you’re eligible to receive. There are two types of loans: subsidized and unsubsidized I. Subsidized Loans – These are loans that are subsidized by the federal government, meaning that the interest payments on them are very low (which is better for you). Two of the most common subsidized loans are the Stafford and Perkins Loans. We don’t want you to take out loans by covering any unmet need with scholarships and merit aid, but this is your best bet if you really need to take out a loan. II. Unsubsidized loans – These are loans usually offered by private companies that have no federal government subsidy, meaning that they have a higher interest rate (which is bad for you). Really, really try to avoid these! Make sure that you talk to your college counselor and do plenty of research before (we hope you don’t) take out an unsubsidized loan.

Why does College Money Search charge a fee?

Some families may ask them themselves why does College Money Search charge a fee when there are so many other search sites that are free. Unfortunately, nothing is really free. Websites that don't charge a fee are making money to cover their costs, in a different way. Most likely, they collect your personal information and either sell it or sell access to you through marketing arrangements. So why don't we do that? Because we feel the college search process is very private and don't feel it benefits students or parents to share personal information with others, particularly colleges. Here's what another prominent search site has in their privacy policy and it's exactly what we are trying to avoid. You decide who you'd like to deal with..... "By providing information on a XX website, you expressly consent that XX may collect, process, share, and/or sell the personal information and information we collect about you to colleges, marketing partners and Third Party service suppliers including telemarketing companies who may contact you to offer you free information about colleges, college admissions, scholarships, and offers and promotions designed for students, and expressly consent to be contacted by telemarketers including contact via automatic telephone dialing systems and technology that send telephone calls or text message to the telephone number provided, even if you previously registered on a Do Not Call registry."

How does my home equity affect financial aid?

Your primary residence is not eported on the FAFSA, but it IS reported on the CSS Profile. Usually, the parents' equity in a property is considered in exactly the same manner as money they have in cash. So, if their house is worth $300,000, but they have a $250,000 mortgage, a $50,000 asset feeds into the financial aid calculations. Assuming the house doesn't change much in value over the next year or so, buying a house neither helps nor hurts a family with a student applying to schools requiring the CSS Profile. In the above example, the parents have $50,000 in equity in a house as opposed to a $50,000 potential down payment sitting in the bank. Buying the house effectively "hides" the $50,000 at a FAFSA-only college, but does nothing to their EFC at a Profile school--basically just like moving money from one pocket to another. They still have the same amount of money. Some Profile schools cap the amount of equity they consider available to pay for college, but this typically only comes up when a house is inherited and a family has very high equity and very low income.