<p>To make this a short and sweet question...is the relationship between merit aid and fin aid the same at all colleges? One college indicated that our expected family contribution would remain the same no matter what my son brought to the table for scholarships. Now, the college he has decided on, indicates that might not be the case. So my question is which hypothetical scenario applies:</p>
<p>Tuition= $30,000
Merit aid = $15,000
EFC = $24,000
We pay $15,000</p>
<p>OR</p>
<p>Tuition = $30,000
Merit Aid = $15,000
EFC = $24,000
We pay $9000</p>
<p>I think Happymom misread the question because there is an answer…</p>
<p>Tuition = $30,000
Merit Aid = $15,000
EFC = $24,000
We pay $9000</p>
<p>that is not correct. In the above scenario, you’re trying to apply merit directly to your EFC. Schools aren’t going to do that AND then give you need based aid so that you only have to pay $9k. The school is going to use their merit scholarship and FIRST apply it to need.</p>
<p>It depends on the school. There are SOME schools that do allow a student to stack all kinds of aid up to the cost of attendance. However, in the scenario the OP posted…if the cost is $30k and they got $15k in merit…that would leave a balance of $15k to pay. Now…if the school added in additional aid, or the student got additional aid from elsewhere…schools that allow stacking would allow the student to garner aid up to the cost of attendance</p>
<p>In OP’s second scenario, the total of the merit & “we pay” is the same as the EFC. This leads to me think there may be some misunderstanding about the whole cost & EFC relationship.</p>
<p>Cost of Attendance (COA) is the cost of the school. COA-EFC=Need. In OP’s case, COA-EFC=30,000-24,000=6,000; Need-6,000. You “could” get up to $6,000 in need-based aid (assuming the school meets need). If OP’s child gets a merit scholarship of $15,000, the effect is that the family will be paying less than the EFC. There definitely would not be any need-based aid, since the merit is more than the Need. The school would most likely not give you $6,000 in need-based aid and then give a merit scholarship of $15,000 on top of that … because the merit means there is less need … in this case, it is 30,000-24,000-14,000=a negative number (or no remaining need to meet). Now, if the schools COSTS $30,000 the actual COA is probably more (add in estimates for books and personal expenses) - and if it’s just tuition, add in room & board - in this case, the COA will be higher & the student may still be able to get need-based aid.</p>
<p>That is correct, I meant COA. Wow I need to read these over again to get it all to sink in. One thing I do know is that the school will send its ED decision along with it’s merit package before it receives the Fin Aid info. So NBA is determined after merit aid is, but I know our basic EFC from doing Fin aid calcs.</p>
<p>Yes, Need Based Aid is determined AFTER merit scholarships are applied. Merit is applied to need, and then if there is STILL need, then you might get some need based aid.</p>
<p>It sounds like you have an unaffordable EFC. If so, then there are only a few ways to reduce that…</p>
<p>1) commute to a state school or CC where the total cost is below EFC.</p>
<p>2) Get enough merit so once it’s subtracted from COA, the result is below EFC</p>
<p>3) If after merit scholarships are applied, the “amount owed” is still unaffordable, then have your child take a $5500 unsub student loan.</p>
<p>Usually, ED schools send an estimated financial aid package allong with acceptance. The merit awards are usually given at the end of the year. Not to say that is the way it is always done. Perhaps these are guaranteed awards based on certain test scores, gpa and ED app. </p>
<p>Schools can do things in many different ways, so it’s difficult to cover all possibilities. Most of the time, any merit money you get is applied to your need package . If you get merit money that exceeds need, you do get to keep the excess. But need is just that–“need” and regardless of where you get the money to meet it, from your bank account, a job, or a merit award or winning the lottery, you no longer have it if there is money to cover it. Merit is usually money given regardless of need so that those with zero need can pocket it. Some schools do allow stacking of outside scholarships and allow some layering, but most all I have seen will not give their own need funds to a student when need is covered by some internal merit award. They integrate the awards. Federal money has to be integrated. You get an award, it does drop your need figure. That is by federal law.</p>
<p>You will have to talk to the financial aid office at the school. At public universities, merit aid will be applied first, and then need is taking into consideration. At private colleges, they can choose to use their own private money in whatever way they wish. We have found vastly different policies in talking with the FA staff at different schools - and we have spoken with them about very specific situations, so we know they handle them differently.</p>
<p>At one school, merit is applied first, and any merit aid you bring from outside will first be used to reduce any loans, and then will cut into any grants. Unless you have very little need, outside scholarships won’t really help you (except to shift you out of loans if they are park of your aid package).</p>
<p>At another school, institutional merit aid reduces your need, leaving your EFC unchanged, just like the first school. However, they allow you to apply outside scholarships toward your EFC. You did the work to “earn” that money, so you can apply it however you see fit, as long as it follows the guidelines of that scholarship (if it has restrictions).</p>
<p>At yet another school, they apply need based aid first (and meet full need), and then use institutional merit aid to reduce your EFC. Their belief is the merit aid isn’t really merit aid if it doesn’t do anything to change your situation. Otherwise, a student with very low EFC doesn’t really qualify for any merit based aid. They also usually guarantee a 4-year package, so that the 529 owned by the grandparents can be used the first year without messing up the EFC the following year because it is considered untaxed income.</p>
<p>Each school does indeed have its own policies, and those will be guided at least in part on the source of the aid, and even how they calculate need when awarding institutional grants, rather than federal aid.</p>