Types of Financial Aid
Financial aid is any money a student receives to pay post-secondary educational expenses from a source other than his/her family.
Categories of Financial Aid
Financial aid can be divided into two main categories, need-based and non-need-based.
- Need-based: To receive need-based financial aid, a student must demonstrate that he needs
the money to pursue his education. Financial need is determined based upon financial information that is entered on the Free Application for Federal Student Aid (FAFSA). The Department of Education will produce a number called the Expected Family Contribution (EFC) which reflects the family’s ability to pay for higher education costs. The EFC calculation determines the student’s financial need.
- Non-need-based: Students who do not have demonstrated need resulting from the FAFSA Expected Family Contribution (EFC) calculation may still qualify for no-need aid.
Types of Financial Aid
Need-based and non-need-based financial aid is divided into three main categories.
- Scholarships and Grants: Scholarship and grants are often called “free” money or gift aid because a student does not have to repay these resources. Scholarships and grants are the most desirable type of financial aid. In most instances, students must have demonstrated need to qualify for scholarships and grants.
- Loans: Loans are a type of aid that the student or his parent must repay. Because loans have to be repaid, they are considered self-help resources. Repayment of student and parent loans usually begins after a student completes his education or drops below half-time status. There are two types of educational loan resources available. Federal direct loans and private education loans. Students should utilize federal direct student loan options before considering private education loan options. Federal Parent PLUS loans go into repayment as soon as the funds are fully disbursed to the college.
- Employment: Employment is also considered self-help aid because the student earns compensation (a paycheck) for work performed. Students who have demonstrated financial need may qualify for the Federal Work-Study program. Federal Work-Study Guidelines
Sources of Financial Aid
Financial aid comes from a variety of sources such as the federal government, the institution, and private organizations.
The federal government is the largest source of financial aid. The most common federal student aid programs are authorized by Title IV of the Higher Education Act of 1965 (HEA), as amended, and are known collectively as Title IV programs. Federal Student Aid, an office within the U.S. Department of Education, administers the programs. Financial aid from the federal government includes grants, loans and work-study. In order to receive federal student aid, students must complete the Free Application for Federal Student Aid (FAFSA) each academic year they are in attendance.
Institutional financial aid resources are funds available directly from the college. The types of institutional aid include merit awards and need-based scholarships and grants.
- Merit Awards: Carroll College offers merit scholarships to qualifying freshman and transfer students. Merit award eligibility is determined based upon the student’s academic ability. Merit award amounts are fixed based the term of entry and will not increase nor decrease for subsequent academic terms.
- Freshman Merit Awards: Freshman merit awards are determined based upon the student’s cumulative high school GPA and test scores from either ACT or SAT. Freshman student merit awards range from $12,000 to $19,000.
- Transfer Merit Awards: Transfer merit awards are determined based upon the student’s cumulative college GPA. Transfer student merit awards range from $10,000 to $14,000.
- Need-based scholarships and grants: Carroll College offers need-based scholarships and grants. Priority consideration is given to students who are admitted to Carroll and have submitted their FAFSA by December 1st. Carroll College merit scholarships, awards and need-based grants are often funded through the generosity of alumni and friends of the college. You may be notified in the fall of a specific donor’s name and then requested to write a thank you letter to the donor.
Private organizations often offer scholarship funds to students who are enrolled in college. For a listing of private scholarship announcements and resources, visit the scholarship section.