Admissions Academy Blog

Financial Aid Terms to Know

•  Posted by Sarah Ziegler on January 15th, 2008 in Admissions
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FAFSA – The Free Application for Federal Student Aid (FAFSA) is required by all public and private colleges and universities for need-based aid. The FAFSA is available after January 1st from http://www.fafsa.ed.gov.

CSS Profile – The College Scholarship Service PROFILE is required by many private colleges to determine eligibility for an institution’s own grants, loans, and scholarships. The PROFILE determines financial need differently than the FAFSA, taking into account factors such as whether your family owns a home. The PROFILE is available each fall from https://profileonline.collegeboard.com/index.jsp.

Expected Family Contribution (EFC) – EFC is the amount of money that parents and students are expected to be able to contribute to the cost of a college education. The EFC depends on a number of factors, including the student’s dependency status, family size, number of family members in college, taxable and nontaxable income, and assets.

Parent Loans for Undergraduate Students (PLUS) – Federal PLUS loans are available to parents of dependent undergraduate students. Parents may borrow up to the full cost of their son/daughter’s education, minus the amount of other aid received.

Subsidized Loan – A federal loan for which the government pays the interest while a student is in school or during any deferment periods. Subsidized loans are awarded based on financial need.

Unsubsidized Loan – A federal loan for which the student is responsible for the interest, not the principal, even while the student is in school. Unsubsidized loans are may or may not be based on financial need.

CAL Grants – CAL Grants are need-based aid, up to $9,700 a year, that can be used at any qualifying California college, university or career or technical school.

Work-Study – Federal work-study is a form of need-based aid to support undergraduate students who wish to work part-time in college.

Need-Blind – Some private colleges (e.g. Amherst, Cal Tech, Middlebury, MIT, Pomona, Stanford, and more) use a need-blind admissions process, meaning that the school will make an offer of admission to a student without considering the student’s financial situation. There is no admissions advantage or disadvantage in applying for aid.

Families can visit the new http://www.fafsa4caster.ed.gov to start the financial aid planning process even before the FAFSA is available. Get an early estimate of eligibility for federal aid, become familiar with different types of aid, and complete preliminary FAFSA information that can later be transferred to the official FAFSA application.

For a comprehensive guide to financial aid, including special circumstances such as divorce and financial aid, visit http://www.finaid.org.

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