EFC question and ED and promises to meet need

<p>I would seem like it would be safe to apply ED to a school that guarantees ED students to meet their need. However, when I used the financial aid calculator for a particular school that my daughter wants to apply for, the EFC there is higher than it was for any place else. I guess they could say they "met need" because they did give enough in aid to cover what is beyond their EFC, but they set a higher EFC than any other school. I know this is just the financial aid calculator, so it could be wrong. But the other part on "meet need" issue is that it seems schools that claim to meet need, are putting in tons of loans, including parent loans and unguaranteed loans, within the financial aid.</p>

<p>I am kind of wondering if perhaps it is a bad idea to not apply to any place early decision if financial aid is a concern, even if the school claims to "meet need?"</p>

<p>Schools have varying formulas they use when computing the awarding of their institutional aid. To be blunt…it is THEIR money and they can choose how they determine the awarding of need based aid. All schools that guarantee to meet full need for ALL students require the Profile on addition to the FAFSA (with the exception of Princeton which had its own form). The Profile takes a much more in depth view of your finances. Parents here have reported need based financial aid awards that vary by thousands of dollars. If financial aid is a significant consideration, you want to be able to compare awards. Also some schools will reconsider an award if you have another from a peer school…something you cannot do if you apply ED.
based a</p>

<p>In general, it is not a good idea to apply ED if you have financial concerns. Some schools have no-loan policies for everyone or for various income brackets, but other schools, like you suggested, may pile on loans to “meet” the EFC they calculate, which could be higher than you expect. Unless you are very well read on the school’s loan policies and such and know exactly what to expect in terms of aid, ED is probably not for the best.</p>

<p>We’ve had some lively discussions on this board about ED. I’ll tell you straight out that I am not a proponent of ED for those students who are from families who are asking for financial aid, and for whom cost is an issue. I suggest that you look for some of the thread and read the arguments.</p>

<p>It’s easy to say that if you can’t afford the cost, you can just turn down the offer, but to me, the term “afford” is often a fuzzy one. For a family whose budget is very tight, the differences between other offers and the ED one could be substantial, but they are not going to know this when they are looking at the one package in a vacuum. A family for whom making the numbers work is going to be very difficult, is stuck between giving up this bird in hand that may well be the best that will happen for that type of school or just somehow making it work, with a very painful “somehow”. </p>

<p>Two very respected veteran members of this board whose children have gone through the selective school process have reported that there can be huge differences in financial aid packages among schools that say the use the same methodology and are peer schools. They also report that by bringing up differences in the awards, schools will sometimes ante up more. When you are talking about differences in like schools all that say they meet full need that can come up to $10K in cost differentials, that’s more than $40K a year which is a big difference in the life of some families. </p>

<p>There have been some cases where the situation has been carefully studied and a lot of prep work has been done, and a dollar amount decided upon for a school that is clearly a first choice. One dad who did such research, came to the conclusion that CMU was by far the best school for his son, and by asking for their pre read, and learning about their financial aid policies (CMU is not a full need guaranteed school EXCEPT for ED applicants), this parent after reading about the drawbacks and pitfalls, came to the conclusion that if his son got into CMU ED and the cost was under $X, it would be worth it for him to go there, never mind that he might get more elsewhere or even more from CMU with offers to compare. That parent knew what he was going into and made that decision understanding that he might be giving up money, but that it was going to be worth it to him, as long as the cost was below $X.</p>

<p>So if a family can come to a point as the Dad above, ED may be a way to go even if you do need financial aid. If your family is set on a certain amount that is doable and understands that it may not be the optimal package, but getting the early admit is where the cost is, that 's one thing. Many families do not operate that way.</p>

<p>You have to understand that meeting full need means different ways of handling Stafford loans, work study and other self help, and even PELL. There may be mandatory student contributions, and the treatment of outside scholarships may come into play. When every one undestands that the only criterion that is important is that the $X price point is met, and that the student will decline an ED offer if the cost falls over that price, then ED might be a way to go.</p>

<p>I don’t like it because most of us, myself included, have a hard time making these decisions without a comparative basis. It would be about impossible for me to let go of an ED offer with my kid’s puppy dog eyes looking at me and the push to end the whole process right there, even if the cost is really more than what I should be paying. The whole momentum of the process would be too much for me, and for most kids, I daresay. For those parents who have the discipline to stand firm and have budgets that can be so reduced to a dollar figure, it’s one thing. For others of us, I don’t think ED s a good idea.</p>

<p>When the schools say they “meet need,” they are saying they meet the need they think you have, based on a formula which only they have and which they do not share (although you can ask them specific questions about your financials). Most schools that meet need include federal student loans (not Parent loans) as part of their aid. The general advice is not to apply ED if financial aid is important because, even if the school comes back with a package that you can afford, you are not in a position to compare packages. It is possible to do so successfully, however, if your financial picture is rather simple and if you are applying to a very generous school. By rather simple, I mean a family that is low-income, not self-employed, doe not have a stepparent/ non-custodial parent/ trust, no private school tuition payments, no significant assets and nothing unusual in their financials. By very generous, I mean ivies and very top lacs.</p>

<p>Only for meets-need-with-no-loans colleges. And then I would say only if they have their own online calculator to get an estimate ahead of time and only if your family finances are pretty simple – no significant assets, 2nd properties, business income, investments, etc.</p>

<p>We did it and it worked out great for us, but our finances could not be simpler and the school has excellent FA without loans.</p>

<p>Different schools have different ways of calculating need. Some go by the FAFSA EFC determination, while others also use College Board’s CSS profile (which typically makes your EFC higher.)</p>