We’re going to tackle financial aid issues all this month since deadlines are approaching to complete and submit the FAFSA (Free Application for Federal Student Aid), the first step in the financial aid process.
But, before we start talking about FAFSAs and award letters and subsidized and unsubsidized loans and Expected Family Contribution, we need to make sure you know what those and all of the other terms mean first.
On that page, you’ll learn what many of the financial aid terms mean, including:
FAFSA The FAFSA is the application that a student and perhaps his/her parents complete. Filling it out is the first step in the financial aid process. You use the FAFSA to apply for federal student aid like grants, loans and work study. On our campus, we also use information from the FAFSA to award donor scholarships to students that may not be based on need. (We’ll have more about the FAFSA on Wednesday, so stay tuned.).
This is the letter you’ll get from a college or university’s financial aid office that lists all of the financial aid that you will receive.
With a subsidized loan, the government pays the interest while you’re in school, during the six-months after you’ve graduated, and during any deferment periods. These loans are awarded based on a student’s financial need.
With this kind of loan, the government does not pay the interest. You are responsible for the interest, which starts adding up the date the loan is disbursed even when you are in school. These loans are not based on a student’s financial need.
Expected Family Contribution
The EFC is the amount of money a student’s family is expected to be able to contribute to his/her education, which is determined by a formula. However, this amount isn’t necessarily what the family will contribute.
On Wednesday: More about the FAFSA.