15. Need-Based Aid

Determined by responses on the Free Application for Federal Student Aid (FAFSA), which should be filed online by February 1 and must be filed again each year.

Expected Family Contribution (EFC)—How much the Federal formula calculates a student and parent(s) can pay for college

Types of Financial Aid

1. Grants—do not have to be repaid (“gift aid”); Pell increased by The College Cost Reduction and Access Act (CCRAA), recently passed by Congress and signed by President Bush.

Federal Pell Grant—If EFC is $0, (maximum) Pell Grant amount is $5,350/yr.—but, if EFC is $4,000 or higher, Pell Grant amount is $0/yr.

Academic Competitiveness Grant (ACG)—A student who completes a rigorous high school curriculum (defined as 4 yrs. English, 3 yrs. math, 3 yrs. science, 3 yrs. social studies, and 1 yr. of a foreign language) can receive an additional Pell grant amount.

Ohio College Opportunity Grant (OCOG)—If EFC is $0 (with a family income level of $75,000/yr.), OCOG is
$1,008/yr. at a public college or university
$2,256/yr. at a private, non-profit college or university
$0/yr. at a private, for profit (proprietary) institution

But, if EFC is $2,191, OCOG is $0.
Therefore, if EFC is 0, $5,350 Pell Grant + $1,008 OCOG = $6,358/yr.

2. Federal Work Study—In exchange for work in a campus job, a student gets paid, up to approximately $2,500/yr.

3. Federal Loans

Federal Stafford Loan—subsidized (current fixed interest rate is 5.6%, cut by CCRAA on 7/1/08 and, eventually, to 3.4% in July 2011) or unsubsidized (6.8%)

Federal Perkins Loan (current fixed interest rate is 5.0%)

Federal PLUS Loan (Parent Loans for Undergraduate Students)—Parents who qualify can borrow up to the total annual cost minus other aid received, with 10 yrs. to repay; current fixed interest rate is 7.9% (+ fee of up to 4% of loan)

Private Loans—at a higher (9.0+%), often variable, rate of interest