I’d like to clarify terms that colleges use…
If a school with a $67,000 COA offers a 40K scholarship, 5K stafford loan 2 K work study and $20,000 parents plus loan to a family Will that school claim that they met 100% of the family’s needs? For this example say the EFC was 10,000
Is the answer different if the EFC was $1,000 ?
Is this your FAFSA EFC?
Does the school use the CSS profile or their own form to determine how they distribute institutional aid
Does the school promise to meet 100% demonstrated need.
What is the EFC according to your award letter. Remember the only thing that the FAFSA does is determine your eligibility for federal aid. If you have a FAFSA EFC of $1000, then there will be a pell grant in your financial aid package.
Keep in mind that most FAFSA only schools do not meet 100% demonstrated need.
What the school has given you is your net price, which s 20k and is offering you a PLUS loan as a way of paying for it. If you can cover the 20k, then you will not need the loan
Parent PLUS loan is not need-based, and it is not aid that is directly awarded to the student … it is a resource available to assist the family in paying for college. So no, it is not considered a part of the awarding package that meets need if a school says it meets 100% of demonstrated need.
@sybbie719 is correct, though, in stating that the school determines need according to its own policies.
@kelsmom thanks that is the answer I was looking for,
@sybbie719 that’s a good way to look at it (btw these were not our numbers, just a general question of terminology)
So if a family sees Parents Plus Loan on their award - the school has not met 100% of that family’s need.
I don’t want families to be confused (or fooled) when they get that letter
It’s not correct to say that if a family sees Parents Plus Loan on their award - the school has not met 100% of that family’s need. The Parent PLUS loan is available to the family to pay their EFC. Many schools include it because they want the parents to know that it is an option.
Need based aid is based on the following premise:
Cost of attendance -EFC = demonstrated need
If COA ( 67,000)- EFC (10, 000) = demonstrated need $57,000
package is $40k scholarship and 2k work study there is a $9.5k gap (meaning the school did not meet 100% demonstrated need)
The net price will be 24.5K (this is how much money will actually need to be paid to the school)
The school will offer the student a 5.5k stafford loan (where 3.5k wll be subsidized) and a 20k loan because the net price to the family after the stafford loan is 19.5K (10k from their EFC and 9.5 K from the Gap)
It is not a need met if there is parent plus loan. UUIC put the whole family need gap of OOS in Parent Plus Loan and obviously they are a need met school.
As mentioned above, this is not necessarily true. A school that meets full need may include on the financial aid offer information about Parent Plus loans as an option available to help pay the EFC portion.
Example of what I have seen:
COA = $65k
School calculated EFC = $30k
Need = $35k
Financial aid package:
School grants = $28.5k
Federal direct loan = $5.5k
Federal work study = $1k
Suggested Parent Plus loan to assist with EFC = amount up to $30k
But if the school meets 100% need, costs are 65k and EFC is 15k they’re not supposed to ‘package’ parent PLUS loans for the 50k need they’re supposed to meet.
If a school meets 100% demo stated need they can still offer a parent plus loan to pay the EFC
I am not seeing anywhere that UIC promises to meet need, @billcsho . But … if they offer the gap between grants/scholarships/FWS/loans as Parent PLUS, all they are doing is informing parents that they can borrow that amount in the form of a PLUS loan.
@kelsmom I did not say UIC, or UIUC actually, is need met. I am saying schools like UIUC that do not meet need would put Parent Plus Loan in the aid package to fill it the gap. So parent plus loan is not a mean for meeting need.
Yes, it depends where “parent plus” is presented on the package: if presented AFTER “net costs” to pay the EFC, it’s a proposition to the parents in case they need it athough their EFC indicates they should be able to pay for it.
However a 100% meet need school should NOT package a parent plus loans to make it appear as if “net costs” are 100% covered.
At a 100% need met school, Parent PLUS loans can be used for EFC but not to cover “need”. If need is 50K and EFC is 15K, the parents plus loans can be offered as part of the 15K (EFC) not package within the 50K needed. If the university offers 35K grants/scholarships, 5.5K loans, then they didn’t meet 100% need, they gapped by about 10K; providing a 10K parent plus loan to cover the gap does not constitute “meeting 100% need”.
Some universities have been doing that - pretending that they didn’t gap the student because they packaged a Parent PLUS loan ON TOP OF the EFC! And that is not what “100% need” means.
That being said, neither UIUC nor UIC promise to meet need. (IN fact Illinois is infamous for its public universities being both very expensive to its instate residents and poor financial aid). UChicago does meet need and is very generous though. Not sure which university is being discussed.
@MYOS1634 , schools that promise to meet need have their own formulas for determining unmet need. They may recalculate the family contribution (so it may be higher than the FAFSA EFC), and they may throw in a summer earnings expectation. Once they have determined unmet need in their own terms, then they will offer aid to meet that unmet need … Parent PLUS is not used in this case to meet unmet need … not for a school that pledges to meet need.
Not all schools that meet need pledge to meet need for all students. A state school that meets need may meet need for in state tuition, but not for out of state. Not all schools that meet need do so for students who file financial aid paperwork after the priority deadline. And some schools have policies such as covering the average cost of tuition with a combination of EFC+grants/scholarships … which is different than meeting need. It’s important to know what “meets need” means for that particular school.
^I know that - they’re not supposed to indeed. But some schools falsely claim to meet 100% need but in reality package the Parent PLUS loans as part of the “aid that meets need”. They also often send confusing financial aid letters.
These are NOT the famous “100% need” schools that are often listed, but smaller colleges that try to make their packages look better. (I am not sure about the names now and don’t want to name the wrong colleges that pulled that trick on unsuspecting families, except to say they were NOT the famous 100% need colleges.)
I would actually be interested in knowing names of actual colleges that you know for a fact have done this. It is not in line with ethical standards of financial aid. It is one thing to say that it is something schools are doing … another to cite specific examples that this is actually happening. I don’t mean to be argumentative, but I hear this complaint every year & have yet to learn the name of a school that actually does this.
I do feel that the Parent PLUS loan needs to be properly explained in the school’s award information. However, even when the school does the right thing, people don’t always pay attention. My cousin’s son goes to a state school & has a Parent PLUS loan from this school. I know for a fact that the school presents the Parent PLUS loan option in an honest manner … yet my cousin ignored the information presented to him & insists the loan is his son’s responsibility. The alternative would be not to present this option & assume the parent will find the information on their own. That’s not a fair alternative, IMHO.
@MYOS1634 that’s exactly the point of this thread. A warning to parents new at all of this.
Also - when doing research in collegedata I see that some schools that do NOT offer to meet 100% need report meeting 100% need in s small percentage of cases. I was wondering if that might be accomplished by offering a parents plus loan.
Parent Plus loans are PARENT loans.
They are not part of student need based aid. As noted above…they are offered…to everyone who files a FAFSA.
@jerseyparents: no, almost colleges that don’t “meet need” are free to and often do offer excellent packages to students that represent an institutional need (sport, high stats, etc) as long as their endowment allows them to.
@thumper1: some unscrupulous colleges package the Parent PLUS loans in the “financial aid package” to make it look like they met the student’s full need. Parents who aren’t used to this can be fooled. Honest actors don’t do that and the true “100% need” colleges from the famous list don’t do that but small colleges desperate to attract students do.
First, the confusion over what EFC is. Just per the Fafsa isn’t “it.” You need the individual college to run their calculation. So in OP’s first question, a Fafsa EFC of 10k might be well less than what the college thinks the family can pay. That’s really the first concern. If a 67k school offers 42k, the family needs to come up with 25k (or roughly 20k, if you do the 5.5k Student loan.)
So if the School calculated your family portion at 20k, then yes, they may see this 42k plus Student loan as meeting “full need.” 42 + 5.5 + 20k from the family. Then, they’ve technically met need. Then, if you need it, the Parent loan is available.
In contrast, if the School says your Family contribution is 10k, but we’ll give you 42k and you can take the Student loan, but that’s it, they’ve left you an additional 10k to come up with. Just saying PP loan isn’t the generosity of the college. It’s not 100% met.
If you fit the constraints of the Net Price Calculator, you can see what the package components may be, or close.