Understanding Financial Aid

Financial Aid - sources of funding that can help students and their families pay for college expenses. Grants and scholarships are sources of funding that do not require repayment; whereas, loans are sources of funding that need to be repaid. Work study money is earned by students at an hourly rate.

FAFSA - Free Application for Federal Student Aid - a form that is completed annually by current and prospective college students to determine their eligibility for need-based financial aid.

EFC - Expected Family Contribution - the amount of money your family is expected to contribute toward your education. It is typically calculated using a formula determined by the Federal Government referred to as the Federal Methodology. Your EFC does not change from school to school.

Need - the difference between a school's cost of attendance and a family's EFC.

Direct Costs - tuition, mandatory fees, room and board.

Indirect Costs - estimated costs for books, supplies, computer-related costs, personal expenses and transportation.

Cost of Attendance - direct costs plus indirect costs.

Grant - a type of financial aid, often based on financial need or academic merit, that the student does not need to repay.

Loan - a type of financial aid which must be repaid, with interest.

Parent Loan - federal loans available to parents of dependent undergraduate students to help finance the child's education.

Payment Plan - an opportunity to pay the balance due over a period of installments during the academic year.

Work-Study - A Federal program providing students with part-time employment during the school year.