Schools have different formulas…even ones that meet full need. Things that can affect this…
Primary Home Equity- this is factored into financial aid at schools using the Profile. Some schools use none, some use a capped amount. Some schools use a higher capped amount.
Business owner/expenses- for self employed or business owners, some deductions allowed by the IRS are added back in as income for financial aid purposes.
Assets- this includes a LOT of things...real estate other than your primary home, investments, bank accounts,,etc.
Retirement contributions. Remember, the amount you contribute to pretax retirement accounts is added back in as incime for that year when need based aid is calculated.
Income thresholds for aid- some forms of need based aid have a very specific income threshold. If you exceed that by even a small amount, you won't get that aid. This is also true at some schools when it comes to packaging loans. For incomes under a certain amount, no Dorect Loans are included. But if you exceed that income threshold, loans are included.
And lastly...don't compare your finances to others. First, you probably don't have the full picture unless these folks are sharing all of their tax and financial documents with you. Second...it doesn't matter what someone else might be getting. All that really matters is what YOU get.
Right, I get all that and your comments here and on other threads have been very helpful in understanding how the formulas work and how they vary.
My starting question was different however - whether there are relatively consistent differences among meet-need schools in aid generosity. The starting point for that question is the misconception among many students/parents (and mine, not long ago) that most students will get very similar packages from “100% meet-need” schools - not so.
But relative to your point #5 above on loans: If a NPC from school #1 gives an output that includes NO loans, and school #2 gives an output that includes the standard $5,500 student loan, does that mean that school #1 formula has determined the student is ineligible for the loans, or simply that the school is intentionally providing a more “generous” no-loan aid package?
And the corollary, if the answer might be the latter, then is it theoretically feasible to go back to the school (later, if accepted and if the financial aid package reflects the original NPC results) and say great, but I do need that subsidized student loan ALSO? (or will the school then say well, if you’re willing to take a loan, we’ll just give you the loan and reduce your grant?)
OP- this isn’t how you “go back to the school”. There are some schools which will not negotiate your package- period full stop. In the absence of a material change in your finances (which does happen of course- and then every college will want to hear from you) the fact that another college gave you a better deal is of zero interest to them. There are other schools which will only take another look if your “better offer” comes from a peer institution/better institution (don’t expect Brandeis to sharpen their pencil if you got a better deal from Stonehill or Hofstra- they will not consider those “peer institutions”).
And it goes without saying but I’ll say it anyway- you may be able to have a candid discussion with the college your kid really, really really wants to attend but is just unaffordable. So the purpose of the discussion is to make it affordable. But you aren’t going to have time (and the financial aid officers will catch on very quickly) to open an auction on your kids behalf where basically you are inviting them all to bid for the pleasure of your kids attendance. The window between acceptances and commitment is rarely long enough to allow you to conduct a protracted negotiation with more than one school.
Even though most folks don’t believe me. But these discussions aren’t a thirty second phone call of 'Sure- we’ll give you 10 grand to make it worth your while thanks for letting us know you’d like more money".
All U.S. citizens and those in certain noncitizen categories are eligible for federal student loans. Financial need will only determine how much of the loan, if any, is subsidized.
Edited to add: and the determination of subsidized/non-subsidized is based on the FAFSA formula; it is not a decision made by each school.
ALL students completing a FAFSA are eligible to take out the Direct Loans, regardless of income.
Some schools do NOT package these loans in their need based aid awards per their policies for awarding financial aid. Some schools do include these Direct Loans as part of the financial aid package to the student.
“So, if the school didn’t package the loans, you’re free to take them on top of their financial aid package.”
That’s what I was roundabout asking, thanks. I assume you’re talking about direct loans, but does that also apply to the Perkins loans? I understand with direct loans the Dept of Education is the lender, but with Perkins the school is the lender, and they are not universally available.
I suppose with interest rates being low, some past benefits of Perkins aren’t so much now, except there are other benefits such as partial cancellation from serving in Peace Corps (possibly elsewhere) that could also be considered. I’m drifting off topic though, and should do some searching for more relevant threads on the loans … next step.
Perkins loans are awarded by the school. You don’t get to choose whether you get them…or not. The colleges have limited funding for the Perkins Loans. They are awarded on a first come, first serve basis, to the lower income applicants.
If the Perkins Loan is not in your financial aid package, you can’t just sign up for one. It’s not a loan available to everyone.
But everyone can take the Direct Loan. I think there might be one restriction. If you get a full need based award from your school…and owe nothing additional including personal expenses…you might not be able to take the Direct Loan. I don’t think it’s given if it would make your aid in excess of,the cost of attendance.
For unknown reason, all D1’s schools came in with virtually the same aid. I think the gross difference was about $125. The minor differences were that one allocated a slightly higher work study, but smaller contribution from student summer earnings (something like that.)
This was before NPCs. Fyi, not all schools rolled out their calculators at the same time.
If a college counts home equity, do not overstate that value. It’s not what the best neighbor home sold for, what you hope yours is worth, or the tax assessment.
Does anyone have a collective view of schools that are consistently bad with need-based aid and which are really good? I know from reading here that Columbia is considered great and Boston College is considered stingy, but are there any other outliers? Thanks
@londondad when you say BC is “stingy” what do you mean? Their NPC looks pretty good for our numbers…do you think that the FA package won’t match the NPC?
BC is “stingy” if you have a lot of equity. If you rent an apartment, BC isn’t.
To know how assets affect things, run the NPC with your current equity, and then with equity 1/3 that.
Not from personal experience, but if you read some of threads here, there are quite a lot of comments about “surprises” when students get their financial aid package from BC.