<p>If we receive outside scholarships, how are they factored into financial aid that a university might offer?</p>
<p>For example, if the total cost of the univ. is $50K, and I'm awarded 30K in financial aid, so that I need to therefore pay the rest (20K)...</p>
<p>*What happens if I win 5,000 in outside scholarships. Does that count for the EFC, meaning I now only need to pay 15K, or does the school decrease how much financial aid they're giving me (so that I still end up paying 20K)? *</p>
<p>It really varies, depending on the school. There are some schools, an increasing number, I would say, that allow the outside scholarship to come off the EFC. Then loans, and finally grant. You will need to check the financial aid sites, or call them, to determine the way this will go. I do know that pretty much all schools require that you report outside scholarships to them.</p>
<p>At the majority of schools, outside scholarships will NOT reduce your EFC. As SCM says, they will usually first be taken from your FA package, reducing loans and work study before grants. Check the website or call the colleges to find out what their policy is.</p>
<p>You need to check with the individual school to find out how they handle outside scholarships.</p>
<p>usually outside scholarships are applied in this order:</p>
<ol>
<li><p>they reduce the self help aid to the student (work study & student loans)</p></li>
<li><p>then they reduce the institutional aid (scholarsips and grant monies given directly by the college)</p></li>
<li><p>most outside colleges cannot be used to reduce your family's EFC.</p></li>
<li><p>some colleges will allow you to use your outside scholarship for a one-time purchase of a computer for school.</p></li>
</ol>
<p>If your school "gaps", meaning it does not mee 100% of your demonstrated need, you will have to find out from the school if you can use the outside scholarships to fill the gap.</p>
<p>Also remember that all scholarship $$ over the cost of tuition and fees is taxable income to the student.</p>