i've been told that each year FAFSA rewards you more money in your aid package. does this mean they give you

Question

access to more loans or do they really give you more FREE money?

Answer 1

Well, technically, the FAFSA doesn't give you any money. FAFSA simply determines your financial need based on information about you and your family. At the end, it gives you an Expected Family Contribution (EFC) value. That is what the government determines your family can afford to pay for college. Colleges then shapes the financial aid package around that number. Let's say that your EFC is $10,000, and your tuition is $30,000. Your school could ask you to pay the $10,000, and then give you a package of various types of loans, grants, and scholarships--all with varying amounts. Keep in mind that some schools are more generous with grants and scholarships (which you don't have to pay back) than other.

Now, as for the FAFSA "rewards" increasing every year-- It is possible that you receive a smaller award from one year to another. If your parents get a raise or a new job that pays more money, then it is likely that your expected family contribution will also increase, which means that you will end up paying more than the previous year. That raise could also make you ineligible for various scholarships and grants.

Answer 2

FAFSA doesn't give you free money unless you qualify due to financial need. If you have loans, each year your FAFSA loan amount goes up - Freshman and Soph year are much lower than junior and senior loan limits. So your parents have to take out less in "parent plus."

Answer 3

I don't know about every year, but there are additional grants that are contingent to gpa and the major your in. In addition the loan amounts for freshmen and sophomore are going up, maybe for 07-08, but the cap is still the same.

Answer 4

It doesn't mean that it's "free" it may be in the form of a loan. There is also a cap of how much they will give you per year.