There can be major differences in EFC in areas such as home equity. In these situations, the student would be eligible for the maximum amount of federal financial aid but not necessarily aid from the school. The amount of federal aid is limited to a combination of grants and loans you have to repay. The second issue is that most schools considered need-based loans such as subsidized Federal Direct Loans as need-based aid because the government is paying for the interest while the student is in school.
Therefore, with the exception of a select few generously endowed institutions, the majority of colleges will expect students to take out the maximum amount allowed in federal student loans. College work-study programs often fall under the same situation. Because work-study is funded by the federal government and the school, many schools classify it as need-based financial aid although it is money the student must earn. Colleges are not allowed to consider subsidized loans, work-study, or loans of any kind for that matter when calculating average net price.
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Your household income is high For most students, a high household income will be the reason for a high EFC. You have a high-value business or farm Like other kinds of assets, a business or farm owned by your family can contribute to a higher EFC. You live in a low-tax state Because state taxes can contribute greatly to the cost of living, the EFC formula grants higher state tax allowances to families from states with higher tax rates. Next Steps If your student has been given a high EFC and any of these above circumstances apply to you or your family, you could now have an explanation for why.
Stephen Ngo. Stephen is a Boston-based digital marketing manager and data analyst. He graduated summa cum laude from Northeastern University with a B. Share This:. Edmit's advice helps you to be better off after graduation. Merit and financial aid estimates based on your student profile Earnings estimates and financial scores for your college and major Recommendations to save thousands on college.
Sign Up. Read More:. Regardless of you EFC number you can only project the amount of financial aid you will receive based upon the historical giving pattern of the respective school. If you have questions please fee free to contact me. Email: [email protected]. How to Maximize Financial Aid? Privacy Policy. Terms and Conditions Policy.
Refund Policy. Rankings or Student Engagement? Basic formula, total cost of attendance minus your EFC number equals your family financial need. What does your EFC number mean if it is not ? Pell Federal Educational Grants money that does not have to be paid back Federal Work-Study Program does not count as financial aid income for student Perkins Loans Subsidized Unsubsidized Stafford Loans You will see these programs in the financial aid award example below.
Perkins loans are campus-based meaning decisions are made the college you are attending.
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