When seeking options to pay for college, using the FAFSA is a great option. The FAFSA, or the Free Application for Federal Student Aid, is a form for students and parents to complete. It assesses the student's financial need, based on their choice of educational institution, housing status, student and family income. The FAFSA will supply the student and family with funding options, including grants and loans. Once the form is completed and processed, the student will receive a notice that outlines their financial need, as determined by the program. This notice will include the student's Expected Family Contribution (EFC), which is the difference between the student's financial need and the amount of funding that state and loan agencies offer. The EFC is the amount that the student and their family are expected to pay.
If the student is a dependent on the parent's tax form, the family is expected to help. If the student is independent and not included as a dependent on the parent's tax form, the student is expected to pay the EFC.
Instructions
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1
Examine your notification from FAFSA. Locate your overall expected financial need. For example, it may state that your housing and tuition needs are $25,000.
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2
Review the grants and loan amounts. Should you accept all that are offered, you will receive the total amount. For example, in the state of California, if your Cal Grant is $2,500, another grant is $1,500 and the loan offers total $15,000, your offered funding amount is $19,000.
Each state has specific parameters and deadlines for grants and loans. These may vary from state to state. Review the specific rules and deadlines for your state.
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Locate your EFC amount. The EFC, or Estimated Family Contribution, determines how much the student and the family are required to pay, based on income and other factors. A low EFC number means you may be eligible for more financial aid than someone with a higher EFC number. This number is not the total cost for a year in college, but is an estimate of how much you and your family can afford to contribute.