For low-income students (approx. 20k income), does Michigan usually make loans a part of the financial package, or is it all just grants/work-study?
If your family is only pulling 20K, your chances of getting solid funding…are excellent. You would likely get very generous grants. This might help you figure out what kind of aid to expect: http://admissions.umich.edu/costs-aid/michigan-residents/family-profiles
Loans will be part of your package, but they will be subsidized. I doubt they will exceed $3500 your first year. The remainder will be grants.