Back in February when the FAFSA form was completed, the U.S. State Department of Education provided the family with an index called the Expected Family Contribution (EFC). This amount tells colleges how much a family can afford to pay for the cost of attendance--tuition, room, board, and fees. With this information, colleges formulated a financial aid package comprised of scholarships, grants, work-study, and loans, to come as close to meeting this need as possible.
To illustrate, for a family with an EFC of $2,000, the college offers the family a combination of aid resources to meet this need, withstanding $2,000 in the most ideal scenario. Some colleges are able to meet 100% of financial need, while others do a poor job. A competitive financial aid package is one that covers at least 90% of the family's financial need. When college aid offers are below this range, I advise families to begin the negotiation process.
For help comparing aid packages, visit HESC's College Financial Aid Award Letter Comparison Tool .
Negotiating a better financial aid deal is as simple as drafting a letter to colleges explaining why the student is deserving of more financial aid. This may seem like an outrageous concept to some, but for excellent students with many school offers, colleges will be willing to work out a better package.
The most effective letters are one guided by these strategies --
Play one college off the other. In the college application process, I highly recommend students choose schools known for offering competitive financial aid packages, even if there's no intention of attending the school, if competing colleges are on the student's list. Why this makes sense is because an acceptance, along with a competitive financial aid package can be used to leverage additional aid from the more favored school.
Last year I worked with a student who was accepted into both SUNY Binghamton and Syracuse. His top choice was Binghamton, but Syracuse offered him more financial aid. We sent a letter to Binghamton, outlining aid provided by Syracuse line-by-line. Within a week, Binghamton responded with a new award letter that topped Syracuse's gift. Immediately the student accepted Binghamton's offer.
Know aid sources and their limits. There are limits to how much grant money is provided to each individual student. For instance, a student with a family EFC of 0 is often awarded upwards to $5,635 in Pell Grant dollars. It is worth spending some time researching grant and loan limits, and checking with the financial aid office that given the family's particular EFC, the maximum amount possible has been awarded.
Explanation of hardship. While this has become a less effective haggling strategy, some colleges still respond to lengthy letters about family changes that affect the EFC after the FAFSA has been submitted with the previous year's information. If a major change has occurred in the family's financial situation, an appeal letter may be submitted to the financial aid office. Examples include change in income, a change in marital status or major medical expenses. In addition to the letter, documentation supporting the new circumstance will be required as an attachment.
Upon receipt of the letter, the financial aid office reviews the appeal and supporting documentation. Once a decision has been made, the family can expect a letter of explanation along with an updated award letter if a change has been made in the student's favor.
If no additional aid has been granted to cover the financial gap, other alternatives are applying for additional scholarships, enrolling in the school's tuition payment plan program, and applying for private loans.
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