Frequently asked questions about financial aid in NC

The College Foundation of North Carolina provides many resources to help students and families choose the right college and get financial aid. Here are some of the most frequently asked questions about financial aid, according to CFNC:

What is student financial aid?

Financial aid is money from federal, state, and private sources used to pay college costs. There are two general types of aid: gift aid and self-help aid.

Gift aid: The two types of gift aid are grants and scholarships. Generally grants and scholarships are the same thing – aid given to a student for which the student does not have to work or have an obligation to repay.

Self-help aid: There are also two kinds of self-help aid – loans and employment:

• Loans – money used to pay current expenses with an obligation for repayment at some future time, usually with interest
• Employment – part time campus or off-campus job

There are multiple sources of financial aid awards. Some examples are:

• State programs
• Federal programs
• College and university programs
• Local, regional, and national private programs (foundations, clubs, organizations)

What is student financial aid based on?

There are different qualifications for various financial aid programs: "merit," "need" and other criteria.

• Merit based: Financial aid based on special talents, achievements or skills of a student. Examples of merit-based awards are academic, drama, music and athletic scholarships.
• Need-based: Financial aid based on the difference between the total cost of attending a specific college program and a family's ability to pay that cost as calculated using standard formulas.
• Other based: Financial aid based on neither merit nor need. Examples include grants based on state residence, jobs, campus work, parent loans, some student loans.

What are college costs?

College costs vary widely. Most of the difference is in tuition and fees, which are lower at public institutions because the state subsidizes in-state residents. Other costs are much the same at public or private institutions. Costs that are generally considered are:

• Tuition
• Required fees
• Room
• Meals
• Books and supplies
• Personal expenses
• Transportation

What about need-based grants, loans, and employment?

Most available financial aid is need-based. Need-based aid is seldom all gift aid; often it is a combination called a "package" of gift, loan and work; sometimes it is offered in the form of loans and/or work only. Your family is responsible for costs to the extent of its ability to pay college costs. The purpose of need-based aid is to provide access to college and choice of a college. Every year there is a new determination of eligibility for need-based aid, annual applications are required.

How do I apply for student financial aid?

File the Free Application for Federal Student Aid (FAFSA).

• FAFSA application – As the name states, the form is free; you should not have to pay anyone to complete the form.
• Required annually for all types of need-based state and federal aid (file as soon as possible after Jan. 1 of the senior year in high school and each year thereafter).
• Applications processed centrally by a federal processor.
• Application results sent to institutions listed by student on FAFSA and to the state agency.
• Student Aid Report sent to student to confirm data.

Other forms may also be required by the college or university of your choice (check with each college). Among these forms are:

• Their own institutional applications for need-based aid
• College Scholarship Service PROFILE (a national form used by some colleges and universities for awarding their own need-based student financial aid funds)
• Specific college merit scholarship applications (often with fall deadlines, so apply early)
• Scholarship applications from sources outside the college or university (foundations, clubs, etc.) can be important also. Find out about these "outside scholarships" by using resources including:
  • High school counselor's office
  • Fraternal, civic and church groups in your area
  • Free Internet scholarship searches. You should never have to pay for scholarships or scholarship searches. Note that some search engines will sell/share your personal information with other "partners."

Are there some tips for applying for student financial aid?

• Be sure to complete all required forms by deadlines.
• Complete all questions accurately; estimate if necessary to meet early deadlines.
• Don't wait until you are admitted to file the FAFSA.
• Keep a photocopy of all documents for your records.

How is eligibility for need-based aid determined?

Standard formulas compute a parent's contribution and a student's contribution. To be considered for FEDERAL and some STATE financial aid, you must meet the following criteria:

• Complete and submit the Free Application for Federal Student Aid (FAFSA)
• Be a U.S. citizen or eligible non-citizen
• Have a valid Social Security number
• Be enrolled at least ½ time in an eligible program and working toward a degree or certificate (may be eligible for only Federal Pell Grant if less and ½ time student)
• Have a high school diploma or General Education Development (GED) Certificate, or pass a test approved by the U.S. Department of Education
• Make satisfactory academic progress
• Register with the Selective Service, if required (males only)

To receive STATE student aid from North Carolina, you must:

• Be a legal North Carolina resident for tuition purposes
• Attend an eligible institution in North Carolina
• Fill out applications specific to the state (while most state programs require only the FAFSA as the application, state scholarship-loans have their own separate applications). Use our financial aid search to find programs of interest to you.

To receive institutional and other need-based aid, be sure to check the specific requirements of the institution or program.

What are major sources of financial aid?

There are many sources of aid – state programs, federal programs, colleges and university programs, local and other programs. Some are need-based, some are merit-based, and some are based on other factors.

Major state programs for North Carolinians:

• Grants/scholarships
• Education Lottery Scholarship
• UNC System Need-Based Grant
• NC Community College System Grant and Loan
• NC Legislative Tuition Grant
• State Contractual Scholarship
• NC Student Incentive Grant
• Scholarship-Loans
• Nurse Scholars Program
• Nurse Education Scholarship Loan
• NC Teaching Fellows Scholarship
• Prospective Teacher Scholarship Loan
• Health, Science and Mathematics Student Loan
• Principal Fellows Program

Major federal programs:

• Grants
• Federal Pell Grant
• Federal Supplemental Grant (FSEOG)
• Academic Competitiveness Grant
• Jobs and Loans
• Federal Work Study
• Federal Perkins Loan
• Federal Direct Student Loan Program

College-sponsored aid opportunities are plentiful, but these opportunities vary widely from college to college. To find out just what opportunities may be available for you, review college websites and catalogs (sometimes called bulletins) or contact the school's financial aid office. Many colleges and universities offer both need-based and merit-based financial aid, including:

• Grants and scholarships
• Alternative parent and student loans
• Student employment

Local and government organizations are another good source of scholarships. Your school counselor or public library will have information on local financial aid opportunities. Examples of groups that may offer this type of scholarship include:

• Churches
• Civic groups
• Parents' employers
• Veterans' Administration
• Vocational Rehabilitation Services
• ROTC Scholarships
• Robert C. Byrd Honors Scholarship Program

What is a financial aid package?

A Financial Aid Package represents the best efforts of the college or university financial aid office to meet a student's demonstrated need or to offer other suggestions for available aid. Some colleges are able to meet full demonstrated need, but some cannot.

Colleges communicate aid options to the student by an "award notice" that lists programs of aid and amounts available. Financial aid packages generally include a combination of gift and self-help. The proportion of gift and self-help will vary by college or university and sometimes by other factors as well. The package may be adjusted if/when other resources are awarded to the student.

What if I have special circumstances or want more aid?

Significant change in your family can lead to changes in financial aid. Let the college financial aid office know about changes such as:

• Unemployment of a parent
• Death in the family
• Change in parents' marital status
• Major non-discretionary expenses such as medical bills

Be prepared to provide documentation of any change. Adjustments to aid awards – especially need-based awards – are not made based on "negotiations" but on changed circumstances and new information.

How do I compare financial aid packages from different colleges?

Ask yourself these questions in evaluating financial aid offers:

• With the aid offered to me, can I afford to attend my first choice college or university? Remember, the goal of aid is to provide access and choice, not to lure you to a college you don't really want to attend.
• Is there a commitment from the financial aid office to continue the aid after the first year of college? Under what terms and conditions? What are my responsibilities in securing continuation (application deadlines, grade point average, etc.)?
• Is the amount of the loan and/or work reasonable? How many hours of weekly work does the award imply?
• Can I afford the monthly payments on a loan once I have graduated?
• Are there other options available to me at my first choice college or university? If the aid offer is not sufficient to enable you to attend your first choice, ask the aid office at that college or university if they can suggest other options for financing your education.

If you would like more information about choosing a college and getting financial aid, visit the College Foundation of North Carolina's website.