This is completely not true. MIT doesn’t give merit awards at all…so a merit award at any other school is not going to matter to MIT. In addition, IF MIT were to consider another college’s award, it would need to be a peer school…and I doubt MIT views UMD as a peer school.
To the OP…you have the opportunity to graduate from undergraduate school with $0 in debt. It appears that your family will need to incur $20,000 a year in debt…at least…for you to attend MIT.
You already say your parent has reduced income right now. In these uncertain financial times, that full ride to UMD is terrific.