April 14, 2016

The Art of Negotiating Your Financial Aid Offer

Many families don’t realize that the financial aid offers their student receives are just that, offers. You have the option to either accept or deny an offer, and you can also contact the school to negotiate something better.

There are a few different strategies or opportunities you can capitalize on in order to request additional aid for your student. In any case, you’ll want to make sure you collect all the information you need ahead of time, and contact the admissions office through phone, email and even send a snail mail. Be professional and courteous to the school representative.

Your financial aid offers are not set in stone. Find out if you can appeal your offer.

Before beginning, look at your offers, and ask yourself the following questions:

Are your sources of aid mostly grants, or mostly loans?

Sometimes a source of aid is not clear. If the college uses terms or acronyms you don’t understand, contact them to be sure a source of aid you think is a grant isn’t actually a loan.

Even if the school has met your student’s full financial need the offer could likely be stuffed with loans with very little gift aid such as grants and scholarships. Although loans are considered part of an “aid” package, they are not truly aid from the college, it’s just a payment your student makes after they graduate (and after a significant amount of interest has been added to the principle!)

Don’t hesitate to contact the college to point out to them the undesirability of your financial aid offer. Ask for some of the loans to be replaced with grants or scholarships.

Is your financial need being covered?

The gap between the total cost of attendance and your EFC (Estimated Family Contribution) is what is known as your financial need. Colleges are supposed to meet all of your financial need, but sometimes the financial aid offer falls short (known as gapping), or sometimes they do meet your need but mainly through loans.

If there is a significant gap between what the school is offering and your EFC you have an opportunity to request additional aid from the college to make it affordable for your student to attend.

Has your financial situation changed?

When you fill out the FAFSA you are using last year’s data to report your financial circumstance. There are limited opportunities for you to signify a change in circumstances such as a job loss, significant medical expenses, or some other event that has reduced your ability to pay for college. Typically you will have to report such changes to the college at a later point to see if they can adjust your Expected Family Contribution to more accurately reflect your current ability to pay.

Is this school still the best choice for your student?

Students should never make their choice based on price alone. If the school doesn’t offer the major they are interested in or has dismal graduation rates a hefty financial aid package won’t make it a better deal.

Are there hidden costs to consider?

Traveling far away? High transfer rate? Consider some of the hidden costs associated with a school that isn’t always reflected in the financial aid offer.

How to Appeal Your Financial Aid

Start Early: Try to get the appeals process in place as early as you can. The admissions office has an incentive to work with you early in the game as it shows your student is heavily interested in the school and will likely attend if you can reach an offer that is acceptable.

Ask the School to Match an Offer: One successful strategy is to ask the school to match an offer from another institution. “College B has given us a financial aid package with $1,500 more in scholarship aid. But we would much rather attend your school. Can you match this offer?”

Offer Additional Information: Scholarships are not always awarded based on grades. Many colleges keep scholarship money in reserve to distribute to students who they believe would be a good fit for their school. Offer additional information about your student that demonstrates why they would be a wonderful addition to the school. They may be eligible for a scholarship that rewards volunteer work, unusual talents or abilities.

Be Ready to Provide Proof: The school will probably ask for proof of a change in financial circumstances if that is what you are reporting. Be ready to send financial statements or copies of bills to the school in order to back up your story.

Want more? Use College Cost Cutter to analyze and compare all of your college offers, and get all the data you need to appeal your financial aid package.

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