Question about private scholarships

swimcatsmom
Sun, 21 Dec 2008 13:13:17 +0000

Scholarships generally reduce your need. If a school is meeting your full need then an outside scholarship would reduce your financial aid awards. If they are not meeting your full need, as calculated by the COA less your EFC, then the scholarship should be able to be used to cover the GAP. It cannot generally be used to reduce the EFC.

For instance if the school costs $20,000 and your EFC is $8,000 then your ‘need’ is $12,000. If you have merit awards of $5,000 then your need is reduced to $7,000. If you are awarded $7,000 of need based aid then your full need is met. If you got an outside scholarship of $1,000 it would reduce your ‘need’ by $1,000 (not your EFC) so they would generally reduce your need based award to $6,000 to reflect this (usually loans and WS are reduced before grants).

However if they had only awarded you $5,000 in need based aid then you would have $2,000 in unmet need. A scholarship of $1,000 should be able to be used toward the $2,000 unmet need.

It is always best to ask your school for their specific policies.

Personal and business debt is not taken into account by FAFSA. However, if your family has a large amount of out of pocket medical expenses because of your Mom’s health problems you can ask for a special circumstances adjustment to reflect this. You file FAFSA with your actual income and assets. Then you contact the school financial aid office and explain the circumstances. You will be asked to provide detailed supporting documentation of medical bills. If they approve an adjustment they can go into your FAFSA and reduce the income to reflect this. (note - they can adjust it - you cannot). Then FAFSA will produce a new EFC. We did this a couple of years ago when we had over $10,000 in medical bills and it reduced out EFC by $2-3,000.

finaid has some information here
[FinAid | Professional Judgment | Special Circumstances](http://www.finaid.org/educators/pj/specialcircumstances.phtml)

[FinAid | Professional Judgment | Medical and Dental Expenses](http://www.finaid.org/educators/pj/medical.phtml)