Once you have completed the FAFSA and understand what your Estimated Family Contribution (EFC) is, it is time to determine what type and how much Financial Aid you may need based on the schools you are admitted to. Schools are required to send out a Financial Aid Award Letter to you once you have filled out the FAFSA, but these Award Letters are often hard to understand and thus, hard to fully interpret the cost of attending that college or professional school. In July of 2012 the Obama Administration released what a “model” financial aid award letter should look like so we will dissect each section as many schools are expected to follow the model for the 2013-2014 school year . The 5 key points, according to the new “model” award letter include:
- Total Tuition cost for the year you are applying for
- Financial Aid options being used that clearly define Grants, scholarships and other aid
- Total net cost after, which is the total tuition cost after scholarships and grants have been deducted
- Schools vital factors as it relates to default, graduation and median debt rates
- Potential monthly payments after a student graduates based on averages
As you can see the Financial Aid Award letter will detail out exactly what you are eligible to receive in Financial Aid from that school as well as some other very good
indicators. To see an example of what an Award Letter may look like, please check out our Award Letter sample.