Written by: Financial Aid Sense
It is a very exciting time in the life of the high school senior when the college acceptance letters start to come in! Excitement mounts and the process begins of deciding which college offer to accept. On the heels of the college admission letters come the financial aid award letters, providing the student has completed the FAFSA and any other required financial aid requirements. College financing is an integral part of the decision of where to attend college.
If you have met all financial aid application requirements, the Financial Aid Office will provide a “financial aid award letter” to eligible students. The letter will either be included in the same package as the offer of admission, or it will come under separate cover following the offer of admission. As soon as the aid offers come in , the time has come to get out your magnifying glass and compare award letters ~ NOT just the total amount of aid offered, but the specific details of each and every financial aid award offered!
An award letter includes an offer of financial assistance, which can come in the form of grants, scholarships, loans, and work programs. Be sure to keep in mind that grants and scholarships are free money and consequently the most sought-after financial aid option. Although grants and scholarships are free sources of financial aid, the reality is that loans are a big piece of the financial aid pie. Student loan terms vary greatly between loan programs, thus it is important to understand the type of loans that are being offered. Remember! Loans need to be paid back, thus it is important to understand the specific terms of each type of loan offered. Some colleges will include PLUS Loans (Parent Loan for Undergraduate Students) on the award letter, even though they are not a guaranteed source of aid until after a parent passes a credit check. It is very important to carefully review award letters to be sure you understand what you are being offered and the terms of each individual financial aid program.
When receiving the award letter, you should review it very carefully and note the amount of financial aid awarded as well as the terms of each of the individual awards offered. Pay close attention to the Cost of Attendance (COA) and whether the student was awarded to full need, or if there is a gap in the funding. Award letter totals may also vary greatly between colleges. Students may not receive equal amounts of financial aid or even the same mix of financial aid programs. It is important to carefully review award letters and ask the financial aid office to clarify any details that are not clear. It’s important to know that each college sets its own qualifications and criteria for merit based aid and that scholarship levels vary greatly from one college to another. It is also essential to note that merit scholarships may or may not be renewable or their continuation may be based on maintaining a certain grade point average (GPA), so be sure to take note of the specific award criterion if receiving a merit award. When formulating an overall financial plan, it is important to understand the particulars of any merit awards. It would be a huge disappointment, and financial setback, if a student planned on a merit award for four years, and then found out that the merit aid was only available for the first year.
The award letter may list additional documents that are required for finalizing the financial aid award. Submit any requested documentation by the stated deadline so that your award can be finalized. In addition, Financial Aid Offices typically require that you accept the awarded aid (or decline it if you don’t want it in the case of loan or work options) by either signing a copy of the award letter and returning it to the Financial Aid Office via mail or fax or accepting the awards via an online portal (at those colleges that use an online process). Keep in mind that even after you accept the awards, you can make changes if needed. For example, a student may decide that they do not need to borrow a student loan; even after signing the award letter the student can reduce the loan amount or cancel the loan by contacting the Financial Aid Office.
This article points out a few items to thinks about when reviewing financial aid award letters individually and in relation to each other. Be sure to understand the aid that is being offered and the terms of each program. If you have any questions at all or wish to ask for additional aid sources, be sure to touch base with the Financial Aid Office.
For solid information about financial aid and the college financing process, check out the newly updated Financial Aid Sense! See what our readers are saying about Financial Aid Sense. This financial aid book also includes a section devoted to financial aid award letters and how best to compare them so you know exactly what you are getting in the college aid package.