How is fin-aid evaluated?

Hello there,

I am a student interested in getting financial aid for when I apply. However, I’m not sure if it is a realistic expectation. I am a white male living in a middle to upper-middle class neighborhood. We currently own 2 cars, one Honda, one Acura. We have a second house in another state, which we are currently renting. It will likely be for when my parents end up retiring. We can likely afford college (unless it’s like Harvey Mudd or something), but my parents are definitely looking for a way to pay less to get more. Is it possible to still get fin-aid, despite having a good financial situation on paper? What are the rules to evaluating a student for fin-aid?

It depends on the school, but having a second home is hits hard and the rent from it also goes against you. Much will also depend on your parents’ incomes.

Look for merit aid.

At any college, if your parents can afford to pay they will have to pay. Their only hope would be merit aid.

Each college has a net price calculator on its web site. You and your parents can try it for several of the colleges you may consider to see what financial aid, if any, they may offer. Each college can use its own methodology and may be generous or stingy.

It doesn’t matter what kind of neighborhood you live in and in most cases it doesn’t matter what kind of cars are owned. What does matter is the income of the parent(s) and the student, the value of any reportable assets that are owned, and how many members of the family there are and whether any siblings are in college.

Your EFC is primarily affected by your income with some adjustments for your assets. A second home is a major tappable asset for college. If your parents want to pay less then look for merit aid. It’s likely you’ll be (close to) full pay at any school that only provides need based aid.

Run the EFC estimator on the college board website to get a general idea what financial aid formulas think your family can afford. Most likely, the EFC will be higher than you expect, and your actual net price will be higher still at many schools.

The options are merit aid or just picking a school that has a lower sticker price, such as an in-state public.

Thanks for all the replies. Will look into the EFC estimator and merit scholarships.

The net price calculators are not particularly accurate when a family has a rental property.

The equity in that rental property will be an asset for financial aid purposes …and the rental income will be income.

As noted above…parent income is the primary driver in determining need based aid awards. And assets.

To be honest, if your parents already own a second home…it’s likely their income is a tad higher than need based aid would indicate.

Biggest question for you to know is the amount they are able and willing to pay for you to attend college.

I agree…look for merit awards that will not take your financial need into consideration.

How much are your parents willing to pay for your college? Could they use their rental income for that purpose?
What state do you live in? What are your stats?

Hello everyone,

Regarding stats:
94/100 GPA (4.0 according to College Board) UW
1420 PSAT last year (sophomore), realistically looking for NMSQT scholarship
Scoring 1520+ on Mock SATs at my SAT tutoring center
White male, upper middle class
Competitive school and district (vocational/magnet)
ECs are listed in other posts, so I won’t bother repeating.

My parents are willing to pay, but like anyone else, they are looking to pay less. They are capable of paying, but I know a lot of people who get financial aid and are in the same or better financial situation as my family.

Also, I have a friend, whose older brother has a friend (undergrad) working in undergraduate admissions at a competitive school. My friend’s brother said that when people apply for fin-aid, the admissions people would literally be instructed to make two separate piles for fin-aid requesters and non-fin-aid requesters. He said this was done to give priority to the people who would pay more (as colleges are a business after all). Is this true, or just a myth?

This is called need-aware admissions. Some schools do it (and are upfront about it), but at the schools that do practice need-aware admissions, there are differences as to how aggressively it is implemented. Schools that are need-blind for admissions do not consider financial need when the application for admission is reviewed and acted on.

So…if I’m reading the above post correctly…you have completed your sophomore year in HS, and have not yet taken the PSAT that will determine national merit status, and have not take the SAT or ACT at all. Your parents are willing to pay for college.

And you have friends who have gotten financial aid with the “same” financial situation as you.

  1. It will be much easier and more helpful to have your actual SAT or ACT scores...as well as your junior year PSAT score. Right now you are giving us "I hope" stats.
  2. Your need based financial aid will be based on your parent income...and assets. It is very possible that your friends got merit aid, and not need based aid. OR maybe their incomes aren't as high as you think they are.

Rule one…don’t count other people’s money.

  1. You won't be attending college until 2019? Right? Keep in mind...policies on awarding financial aid both need based and merit based DO change. What is happening now at any college could very well change by the time you are ready to apply. So...if you do a net price calculator now...it's very possible it will NOT be accurate for a fall 2019 admission.
  2. And again...that second house...and rent will definitelynaffect need based aid possibilities for you. And remember this too....some Profile schools use a portion of primary home equity in their calculations as well.
  3. Are your parents self employed? Do they own a business?
  4. Look at your state of residence. Most likely, that will be the most affordable for your family. Many state flagship universities have honors programs and some offer aid to high achieving students.

I think you and your parents should approach this from the opposite direction. Figure out what your family is willing and able to pay then work backwards from there to determine your safeties, matches and reaches. For a student from an upper middle class family there are essentially two ways to lower the cost of your education. First, choose lower cost schools. These will typically be your instate public universities. Second, is merit scholarships. This normally means being in the top 25% or higher in a less selective school (what “less selective” means depends on just how high your stats are). Financial aid (need based aid) will be unlikely given your circumstances unless you attend an expensive school which may offer some grant aid or perhaps you have siblings attending college at the same time. Even in those cases the only way to be sure is to apply and receive a financial aid package.

Attempting to figure out just what you will pay in advance of receiving a financial aid package from a university is difficult at best. NPCs range from reasonably accurate to useless depending on ones situation. It’s more difficult when you own a business or property. Merit aid can either be guaranteed given certain qualifications (ie. Alabama) or competitive. Most schools seem to have competitive merit aid which makes it difficult to determine just what you will be awarded. Good luck.

Great amount of information! @thumper1 I’m not counting people’s money. My mother works for the tech department at a university medical hospital (not self-employed), but my father is self-employed. He started working in real estate a few years ago, which explains the 2nd house. I am leaving HS by June 2019 (as you mentioned), so there is definitely room for policies to change before I graduate. I am probably going to look more towards merit-based scholarships, because as I see it, our assets work against us for need-based.

Your assets don’t work against you. Your assets give you the ability to be able to afford college. Count yourself as very fortunate in life.

Is your mother a university employee? If so, she may have some tuition exchange benefits. Look into those too.

The very top schools provide needs-based aid exclusively. Their formulae are complex and can vary significantly. Your parents types of assets, and source(s) of income, are not weighed the same way at all of the schools. These schools use the CSS Profile application, but some schools ask for certain supplemental questions that other schools don’t.

Back when my pups were applying to multiple top schools, it was interesting to me that some of the schools wanted to know the make/model/purchase date of our vehicles, while other schools did not care. The reasoning given by one FA director was they didn’t want student/parents to “shelter” money in a Lamborghini or collectible car, and then appear to be as “needy” as other students.

Since OP’s question in the post title was very broad, and others in different situations may read this later, I thought this would be helpful. @BelknapPoint noted in #4 that in most cases it doesn’t matter what kind of cars are owned - which is generally true. While there are some situations where the cars owned might make a big difference, especially between two schools, for the cars OP describes, I can’t see them mattering.

OP, try to remember the following when it comes to other people’s financial situation - their situation does not affect you. Depending on your family situation - if you have 7 younger siblings, as well as other twin/triplet siblings that will be in college the same time as you - you might expect a lot more aid than other families with the same income. Once you change one of the many variables in the FA formula, the amount of aid can / will change a lot. So worry about your own situation only - don’t spend any energy wondering if you only had a couple more younger siblings you’d get better aid - because those are things you cannot change.

You have the stats to indicate you may be on track to be competitive for some of the need-based aid schools - but since you describe yourself as coming from “upper-middle class”, most of these schools would expect your family to contribute a sizeable amount, because you can afford it.

There are people who will use legit strategies to maximize their FA application - but it inevitably boils down to making choices that are somewhat unique to their own situation. Some folks will say get in or out of real estate, some will postpone an inheritance, or ask living grandparents to hold off on relatively sizeable gifts to the student until senior year of college, etc. There are plenty of students who have deferred or accelerated a marriage, because of the financial aid implications.

OP, you should be commended on your achievements to date, and especially for being concerned about how much your family will be expected to shell out. I get the impression that despite your family’s financial success, you may not have yet had the family discussion about not just how much they can afford, but how much they are willing to contribute. Don’t be surprised if your parents are still learning about their own options at this point (as some things have changed a lot since they went to college), and they are still forming the strategy that will best fit their situation. Talking to them about this process is both a learning opportunity for you, and an opportunity for them to see you more as a young adult and less like a child. You are getting ready to make an important decision, by getting information first, and considering the impact on others as well as yourself.

Best of luck to you.

Thank you everyone for replying. All of my questions were answered, and I will continue to look into other stuff that I should do with family discussions and financial evaluation. If I said that my assets work against me, I probably phrased it the wrong way. I am very blessed to have grown up in a family that does not need to live paycheck to paycheck or on government benefits. I acknowledge my situation with complete thankfulness. Sorry if I came off as arrogant or ungrateful. Also, I recall somebody mentioning something about siblings - I am an only child so that doesn’t matter. All I am trying to say is that my situation works against me for financial aid. Lastly, someone asked about university benefits. I do get 20 or 25% (forget exactly what) at my mother’s school. However, I don’t have legacy at any schools - my parents both went to college overseas and they have no intention of going back.