Student financial aid in the United States

[1] In the United States, grants come from a wide range of government departments, colleges, universities or public and private trusts.

Some private need-based awards are confusingly called scholarships and require the results of a FAFSA (the family's EFC).

The school determines how much can be borrowed based on the cost of attendance and adjust for any other financial aid the student is receiving.

This loan allows parents to borrow up to the total cost of attendance, minus any other financial aid the student receives.

These loans typically have much higher interest rates, have fewer repayment/deferment options, cannot be discharged through bankruptcy, and are not supervised by any agency.

Some private need-based awards are confusingly called scholarships and require the results of a FAFSA (the family's EFC).

Scholarships can be awarded based on merit, financial need, student characteristics (such as gender, race, religion, family and medical history, and the like), creativity, career field, college, and athletic ability, among other categories.

To qualify for need-based aid a student must have a significant amount of financial need, which is determined by the federal government based on the FAFSA.

Using the information submitted on the FAFSA, the U.S. Department of Education calculates a figure called the Expected Family Contribution (EFC).

In 1996, public higher education institutions gave students with high SAT scores and a low family income $1,255 in need-based grants.

That is, when planning for the next academic year, a school will know its current and projected costs as well as each student's ability to pay after receiving state and federal grants.

According to the Center for College Affordability and Productivity (CCAP), "If the federal or state authorities increase financial support per student, the institution has the opportunity to capture part or all of that increased ability to pay by reducing institutional grants and/or raising their charges for tuition, fees, room, or board."

Importantly, it also notes that "the exception to this general pattern is modest aid targeted at only low-income students, like the Pell grant."

The center uses data about net proceeds (tuition plus room, board and other fees) as a percentage of median income to show that financial aid practices have not been effective in decreasing prices in an effort to increase access.

In that same time, productivity has declined in the form of lighter teaching loads for professors and increased expenditures on administrative staff.

Merit-based scholarships are typically awarded for outstanding academic achievements and maximum SAT or ACT scores.

With the yearly rising cost of tuition, room and board, and fees among schools across the nation, low-income students are finding it harder to pay for their education.

Statistics do show results of studies performed from 1992–2000 that the increase in financial aid awarded was based entirely on merit.

[28][29] Financial Aid for European Students can be looked by using Noopolis, a database in Italy run by CNR (the Italian equivalent of the US's National Science Foundation).

There are also U.S. Educational Advising Centers throughout the world that assist prospective students by answering the questions they have about studying in the United States.

To make higher education costs more transparent before a student actually applies to college, federal law requires all post-secondary institutions receiving Title IV funds (federal funds for student aid) to post net price calculators on their websites by October 29, 2011.

"The law defines estimated net price as the difference between an institution's average total Price of Attendance (the sum of tuition and fees, room and board, books and supplies, and other expenses including personal expenses and transportation for first-time, full-time undergraduate students who receive aid) and the institution's median need- and merit-based grant aid awarded.

Mary Sapp, Ph.D., assistant vice president for planning and institutional research at the University of Miami, served as the panel's chair.

[34] A report issued by The Institute for College Access and Success, ""Adding it all up 2012: are net price calculators easy to find, use and compare?"

[35] In "Adding it all up," the authors state, "this report takes a more in-depth look at the net price calculators from 50 randomly selected colleges.

While we found some positive practices that were not evident at the time of our previous report, net price calculators are still not reliably easy for prospective college students and their families to find, use, and compare.

"[35] After the requirement came into effect, Abigail Seldin and Whitney Haring-Smith launched the free website College Abacus, which hosted a system that would allow students to enter their personal information once, and then use and compare net prices of multiple schools.

In 2022, Williams College became the first institution of higher education in the United States to eliminate both loans and work-study contributions from their financial aid programs.

Most students prefer no-loan financial aid as a way to relieve the amount of debt they are in after college The following colleges and universities offer such no-loan financial aid packages as of March 2008: Some universities have opted to have a "loan cap" program, which is a maximum loan — either per year or for four years combined — designed to reduce the cost of attendance for low-income and middle-class students.

In a time when colleges are low on financial funds, it is difficult to maintain need-blind admissions because schools cannot meet the full needs of the poor students that they admit.