Applying ED/EA = No Financial Aid?

Parents Forum
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<p>“For schools that only offer need-based aid and that meet 100% of need without loans, there probably will not be a difference in the aid initially awarded whether the student applies RD or ED.”</p>

<p>For obvious reasons, this is unknown. </p>

<p>“those schools that are truly need blind don’t care if you apply for aid or not and I believe that most will work with you if accepted ED and if you’re unhappy with the financial aid decisions, you can walk.”</p>

<p>There are NO schools in the country (well, maybe Cooper Union and the military academies) that are actually “need-blind” - the only question is whether they use any of the information in their decisionmaking. (The evidence I’ve seen strongly suggests they do.)</p>

<p>Columbia used to make quite clear, right on their website, that if they met your demonstrated need ED, and you decided not to take it, they would release you to apply to other schools which “were not competitive with them” (i.e. state universities, etc.) They also stated they only released about two a year. I have no idea whether this is still their policy, or if it applies elsewhere.</p>

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<p>Congratulations, Metal. But I read your award as $8125 in student loans and another $5000+ you still need to cover. Of the loans, $5500 will be Subsidized Stafford, leaving $3675 for either PLUS or private loan. The remainder $5000+ will either come from additional loans or your economizing methods. Then there is the topic of walkaround bucks. </p>

<p>The issue is really whether the family can afford the gap difference between financial award and the actual cost. For the example you give, a Feb 9, FinAward notice may be too late to make other informed RD applications, if you had not already done so.</p>

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<p>My parents arent actually covering a penny of that. I won a large scholarship, and then I have a job covering the rest. I might actually graduate with a surplus. I knew I couldnt rely on my parents so I had it all planned ahead of time.</p>

<p>Im cool. :)</p>

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<p>Whether it is EA or ED, find out if it is Binding. If it is Binding, then make sure you don’t need financial aid. Not that they will lowball you, but their calculation of EFC may be higher than the FAFSA. Yes, most will give you an out if you can’t afford it, but if they meet your need, but you can’t afford the EFC, then it would be tough to opt out at that point. You also loose the ability to play one college off another.</p>

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<p>^ This post is dangerous and misleading.</p>

<p>First, you don’t have to “find out if it is Binding”. In the conventions of the admissions world, “Early Action” is ALWAYS nonbinding, and “Early Decision” is ALWAYS binding. If you know what they call it – and it says what they call it right on the application – you know whether it is binding or not.</p>

<p>Second, it can be perfectly rational to apply ED (binding) even if you need financial aid. The key is making certain that you understand in advance how the college calculates need, whether it meets 100% of need or not, and what kinds of packages it offers (i.e., how much in loans vs. grants). All of that is understandable, although it takes work. For many students – especially those with very little family income or assets – it may be possible to get comfortable that a college will offer a realistic, workable package. It may not be the very BEST package you could get if you applied to 30 colleges, but it may be good enough to be willing to apply ED.</p>

26

<p>“Second, it can be perfectly rational to apply ED (binding) even if you need financial aid.”</p>

<p>I don’t see how it is or can be rational, knowing that 100% of need schools of equivalent quality may offer aid, based on exactly the same information, that differs by the cost (at full rate) of more than one full year of attendance. And this for students who simply cannot attend without very substantial financial assistance (think middle income - $55k/year family income.)</p>

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<p>Because you can say that over and over again, mini, and it still doesn’t prove your point. Yes, different colleges have different conventions for determining need. They evaluate things like retirement accounts and home value differently. They make different assumptions about the number of years of education that assets are expected to cover. (Some make provision for graduate education, others don’t.) They have different tipping points for loans, and different mixes of loans and grants. They handle outside scholarships differently. All of that can easily lead to major differences in aid from one college to another.</p>

<p>But none of it leads to differences in aid at the same college based on whether you apply ED or RD. With the caveats below, many people can get a good idea what kind of aid they are likely to receive from College X and College Y, and if College X’s aid is likely to be workable, a student could decide to apply ED to College X even if College Y’s aid might be better (if the student were accepted at both colleges RD). Given that there is at least some clear admissions advantage in applying ED (not EA), a rational student could conclude that it’s better to have a 20% chance at 90% of the best aid possible (plus, if deferred or rejected, a 10% chance at 100% at the other school RD), as opposed to two 10% chances at 90% and 100% respectively. The first has a risk-discounted value of at least 26, the second more like 19. (And of course the assumption is that the student affirmatively prefers College X.)</p>

<p>OK, two caveats. First, don’t try this with colleges that do not commit to meeting 100% of full need, and that do not have predictable financial aid. Second, if your family has hard-to-value assets – a farm, a closely held business – then financial aid may not be predictable anywhere, and you should be very careful about an ED commitment.</p>

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<p>For us it was rational because the school to which my son applied ED had an online calculator to give you an estimate of financial aid. It is a school that meets 100% of need without loans. The preliminary award he got back with his ED acceptance was virtually identical to what the online calculator predicted. His final award was actually even a little bit better. </p>

<p>We’ll never know what some other colleges may have offered him, but we did know that the aid available at his first choice college was excellent, and that if he was accepted it would work out. Since it was his first choice college, he would have gone there anyway as long as we could afford it. We knew in advance we would be able to, so it was pretty much a no-brainer to apply early.</p>

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<p>PrintIn, Let’s just stick to your two top choices
Chicago only offers EA. As far as I can tell there shouldn’t be any penalties – for need or merit aid – if you were to apply EA. </p>

<p>Cornell only offers ED and only need based aid is pertinent. I believe that Chicago’s EA arrangement allows you to apply to ED schools, but under Cornell’s ED arrangement, if you are admitted you must attend. [The mechanics and ethics of wriggling out of an ED are a separate issue.]</p>

<p>Our initial experience with Cornell’s financial aid department is that they are not terribly helpful. They may be able to give you a good estimate of how much financial aid you can expect or they may not. If your family’s financial situation is fairly straightforward you should be able to use a generic aid calculator to come up with a reasonably reliable figure. If, after using all the resources available to you, you settle on a figure that works for your family, then the financial risk of applying ED is low. </p>

<p>What you won’t be able to do is compare other offers. Thus, assuming that Cornell’s estimate is reliable, then this is the most that you will get. You shouldn’t get less, but you also most likely won’t get more. Only your family can say if the projected amount is workable for you.</p>

<p>Is there risk involved in applying? Yes. Is there risk in not applying ED to your #1 favorite school? Yes. Only you can evaluate which is the greater risk.</p>

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<p>Now who is being dangerous. Not only do you have to predict how much aid you will receive (meeting 100% of full need), but you also need to predict how they will meet that need (grants vs. loans vs. work study). What good does it do to come out of college with $100,000 of loans? Being expected to earn $4,000 in CWS is a lot of hours (15 hours per week). The point of my post is: If you need financial aid, you better make sure that you can live with whatever they might give you if you apply with binding admission. I’ve seen a lot of posts where people applied to schools that say they will meet 100% of need, and then get a package with unbearable loans, or the schools definition of “need” is quite a bit different. If you can do the research and find out, within a narrow range, how the school will award aid, then fine. But, I would guess that the list of schools that meet your “caveats” is not that large, and the number of those schools that would be a students #1 choice is even smaller.</p>

<p>Even a school like Harvard (I know, they don’t offer ED), where you would figure someone has written about them, it is impossible for someone making between $60,000-$150,000 to figure out in advance how much financial aid they will receive. The difference between a family contribution of $5,000 vs. $15,000 /yr could be significant for a family in that range. And, if you earn $151,000 they have no guidance.</p>

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<p>Just to clarify my post #10 above, the no difference I was talking about was FA for the same person ED or RD at the SAME school. I would never expect offers to be the same at different schools - they have different constraints re grants etc, unless one were to apply to the meets full need without loans below a certain income threshold and one was below the threshold. Nor are two applicants likely to ever be identical financially, so aid can not be identical at the same place. </p>

<p>For example, at Cornell see their policies at </p>

<p>[url=<a href=“http://www.finaid.cornell.edu/welcome.cfm]Welcome[/url”>http://www.finaid.cornell.edu/welcome.cfm]Welcome[/url</a>]</p>

<p>If income is below 75000, no loans; if below 120,000 a cap of 3000 in loans. At Cornell you can expect to have a work study component, but at some other schools, I believe this has been eliminated. This will be for RD or ED. That said, ED at Cornell is VERY selective in terms of the pool of applicants, and one should expect to have great data points to be competitive. I do not keep up with other schools, but this type of data - loan caps etc. should be easily obtained from the web sites.</p>

<p>If a great FA package is one of the goals in the college decision, it probably makes the most sense to shop around among schools. However, if someone really wants their dream school, and thinks he or she can get in ED, I do not see the upside in applying RD to that school in hopes of a better FA offer at that school. IMHO.</p>

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<p>Agree with mini wholeheartedly.</p>

<p>Having 5 children 1 year apart all applying to colleges within a 5 year span with the exact same EFC as determined by FAFSA and Profile we were able to compare award offers from over 60+ schools. And some of them were the meet 100% of need with NO loans.</p>

<p>And as mini has stated the range within THOSE schools the aid varied as much as $15,000 per year. And this is with a fafsa completed with the simple needs test.</p>

<p>Also not included in the financial aid calculators are the types and range of “preferential packaging”. Amount of work study ranged from $0 to $4000. Within the no loan 100% need met schools. SEOG grants varied. Summer contribution varied from $0 to $3500.</p>

<p>Work trudy compensation ranged from $7 per hour to $13. How much was awarded for books and personal from $1200 to $3750. How much for travel, how much for health coverage and how much for MISC and other. Categories on many, many packages.</p>

<p>Each package varied from year to year and child to child to the SAME EXACT schools.</p>

<p>Depends on the needs and DESIRES of the schools, and the desirability of that particular student and the specific admission cycle.</p>

<p>Having multiple packages obviously allowed many more options than ED and allowed for more peer institution comparisons. So top LAC contrasted with another top LAC, major research institution with another peer, top Ivy with another top Ivy, top engineering/math/science with other coast rival all lead to HUGE variations like mini suggested.</p>

<p>He stated a least a year’s worth of tuition, and in our case it proved to be true, $60,000+ over 4 years.</p>

<p>This does not take into account the schools that didn’t state no loan policies. And those offers varied even more. And with even more variation the schools that did not claim to meet 100% need without the no loan policy.</p>

<p>Offers of research stipends, travel abroad funds, laptops, premium housing, expanded dining options all were included in different types of “preferential packaging.”</p>

<p>Bottom line we went with the bottom line.</p>

<p>Best perceived value for the out-of-pocket costs. With the disclaimer there was no #1 choice. Too many great schools out there for that. For my kiddos giving themselves many options allowed them choices they did not know existed.</p>

<p>So ED for us was never an option. EA was utilized, with some success. They have all been happy with their journey so far!</p>

<p>Kat</p>

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<p>OperaDad, you are right that there’s a pretty small number of colleges to which my advice applies. I thought that was fairly clear – probably only 20-25 colleges, maybe not even that. More for someone who has relatively low income (family income under $50,000, no significant assets). But each of them is likely to be the first choice of a meaningful number of students, and in part because of their financial aid policies each of them attracts lots of applicants. But it’s not as if waiting for RD guarantees any student that he or she will be accepted to a first- or second-choice college with great financial aid. It allows them to hunt for merit scholarships if they want to do that, and to compare financial aid offers, but there are risks either way. No one should rush to borrow $100,000 for college, but there are plenty of situations where people would be happy (and rational) to accept modest debt to attend the college that fits them best.</p>

<p>People rightly criticize ED for advantaging high-income applicants, who are not sensitive to financial aid differences. Nevertheless, at these few top schools non-wealthy applicants don’t necessarily have to throw up their hands and accept second-class status. That is the effect of following the knee-jerk advice not to consider ED if one needs financial aid.</p>

<p>At my kids’ high school, probably 95% of the students needed significant aid to attend college. Nevertheless, lots of the top students would apply ED to Penn. They did it because (a) experience showed that they would have a better chance of admission ED than RD, and (b) experience showed that they were likely to get a financial aid offer that they could afford (often superior to their in-state public safeties). Might some of those kids have found a somewhat better deal elsewhere if they waited and applied to 20 colleges RD? Sure. But some of them wouldn’t have, and some might not have wound up with the chance to go to Penn. And they didn’t WANT to go to 20 other colleges as much as they wanted to go to Penn. ED was a good deal for them.</p>

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<p>JHS is dead-on. There are a number of ED schools with clear, open policies on financial aid. Those policies are the same for ED and RD. Any fear that colleges will use the fact that you’ve applied ED to “low-ball” your offer is unfounded. Think about it, if you’re willing to apply ED, you are highly motivated to attend that school. Why would they want to %$$# you off by giving you a bad finaid offer and then force you to attend. Just what every college wants, a significant % of their student body who is unhappy before they even start. </p>

<p>We came to the very rational decision (for us) that if the college met out finaid expectations with their ED acceptance, we’d be happy. If they low-balled us, we’d use the “bad finaid, opt-out”. We provided very accurate estimates of our financial situation. They met our expectations, and in fact, the final package received this summer was even better. </p>

<p>All that said, as others have said a million times on these boards, if you want to compare offers, you obviously need to apply RD. But as JHS has pointed out, there are definitely circumstances where ED is rational, even for those needing financial aid.</p>

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<p>If you are prepared to sacrifice as much as full year’s income to attend one particular school out of the 20-25 colleges JHS cites, his advice is just fine. </p>

<p>There is also no evidence that, for needy applicants, ED offers any admissions advantage whatsoever, and there is some reason to believe it doesn’t.</p>

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<p>I applied ED and got an aid package that was pretty similar to other people at my school (VT) with the same background. </p>

<p>Some schools discourage ED if aid is important not because they’ll give you less, but because the amount they were going to give you anyway may not have been enough. And inadequate financial aid CAN be a reason to break an ED, because if you just don’t have the money what are they supposed to do?</p>

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<p>"Because you can say that over and over again, mini, and it still doesn’t prove your point.'</p>

<p>Okay, how about this. Harvard does not figure its awards based on need. They basically say so. They have set a policy for folks earning less than $180k per year, regardless of level of need. Or so they say.As a matter of policy, need-based awards at Harvard for a family of four with $175k in income will be very, very different than it will be at Princeton, or Swarthmore, or Cornell. Same with Cornell, in terms of their loan policy.</p>

<p>At my alma mater, a so-called “need-blind”, 100% of need school, an article in the alumni review revealed that, in the RD round, the admissions director literally counted the number of “socio-ec” admits (read: needing lots of aid) as it happened. The school clearly had a target - they had a budget, and they were going to meet it - ensuring that the number of low-income students accepted would not be too low, or too high. Under such circumstances, there is absolutely no reason to offer an admissions advantage to low-income students in the ED round, when they have the opportunity to compare them all in the RD round (unless they are a recruited athlete, or an all-world oboe player). By accepting lots of full-pay applicants in the ED round, the admissions department at any of these schools provides itself with increased flexibility in RD, while at the same time burnishing its yield rates.</p>

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<p>Harvard’s financial is still based on need. They are just more willing to acknowledge that a family with an annual income of under $180,000 and a normal amount of assets “needs” aid in order to afford a sticker price of $50,000 per year.</p>

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<p>“We no longer require students to take out loans, and parents of financial aid recipients are asked to contribute on average from zero to ten percent of their annual income, with no contribution expected for families with incomes of under $60,000. Those parents with annual incomes of between $120,000 and $180,000 are asked to contribute an average ten percent of their income, with a declining percentage — from ten to zero — for parents with annual incomes between $120,000 and $60,000.”</p>

<p>Even if a student with a family income of $60k can afford to pay something, they won’t. How is that “needs-based”? (It’s terrific, but it explicitly does NOT take account of differences in need.) And students with a family income of $179k can usually afford to pay far more than $17.9k a year - how is that “needs-based”? If you were to compare that with other schools offering “100%-of-need”, you’d quickly find out they aren’t even in the same ball park, no less playing field.</p>

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<p>I’m familiar with Harvard’s financial aid policy. Harvard isn’t the only school that waives tuition for a family making under $60,000 per year. If a family makes under $60,000 per year it doesn’t sound to me like they can afford to contribute anything towards tuition. Our income is in the $120,000 - $180,000 range, that is before taxes, and I can tell you that contributing 10% of that amount towards out daughter’s tuition is about what we can afford to do. I should know, I pay our bills.</p>

<p>The initiative about Harvard’s financial aid policy goes on to say that the reason they implemented the change was because they realized that middle class families weren’t even allowing their kids to apply to private schools, and for those that did the tuition came at great personal sacrifice for their family. Harvard came up with their estimate of 10% of a families gross income because that is what they felt that a middle class family needs to send their kid to their school.</p>

<p>I realize other schools don’t have Harvard’s endowment and so they simply can’t offer this kind of financial aid. But I tend to think Harvard’s assessment of what a middle class family needs is about right.</p>