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College Financial Aid: How to Negotiate for a Bigger Scholarship

Go to the grocery store, and the price is the price. Apples are $2 a pound this week, and you won’t get anywhere arguing about that. Go to a car dealer, on the other hand, and the sticker price is just the beginning of a conversation.

College financial aid is more like a car dealership than a grocery store. It is possible to negotiate a better deal. In fact, the practice is becoming such a common part of the college admissions process that there are now companies focusing on helping families navigate the negotiation. A Sallie Mae survey last fall found that more than a quarter of families asked for more financial help.

Asking never hurts, but it can certainly help more if you know what you’re doing. Here’s how to prepare for a successful negotiation.

Understand how financial aid works

Before you ask for more money, it’s important to understand how college aid works. Colleges and universities give two types of financial aid. First is need-based aid, which is based on the results of the Free Application for Federal Student Aid (FAFSA) and the College Scholarship Service (CSS) profile. Most US colleges use the FAFSA to help determine how much a family can afford to pay for college. Some other schools, typically at the more expensive end of the educational market, also use the CSS profile for the same purpose.

After determining need-based aid, most colleges also award what’s called merit aid. Perhaps the applicant shows particular academic promise, or has a unique talent in music or sports. Or perhaps the student is simply eligible for common college tuition discounts. Regardless, think of merit aid as an added incentive colleges can give to students they’d like to enroll in particular.

Regardless of the type of aid you want to raise, “appeal money is first come, first served,” says David Haas, a financial planner in Franklin Lakes, New Jersey. Therefore, if you are going to use the aid for the school year that begins in the fall of 2021, do it now.

How to get more help based on need

Need-based aid is just that: colleges award it when you demonstrate that your financial circumstances would make it difficult to pay a student’s educational expenses. To get more, you will need to show that your need has increased.

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“If something wasn’t disclosed on your financial aid forms and it can show that you have a special circumstance and need more money, then by all means write a letter explaining your special circumstances,” says James Shagawat, a financial planner in Paramus, New Jersey. Job loss, the death of a family member, or a medical diagnosis that has changed a family’s financial situation are examples of instances where an appeal might help.

Applications for extra help based on need must detail your change in circumstances and the effect that change has had on your family’s finances. If you can, include proof: a letter from your doctor, a layoff notice, or a death certificate, for example. Because need-based aid depends on the parent’s finances, parents must write the letter requesting more need-based aid, unless the student is an established adult or an emancipated minor. Send it to the financial aid office.

How to Increase Merit Aid

To apply for extra merit aid, start with multiple financial aid offers from similar schools. In this case, “similar” means requiring analogous grades and test scores, having similar acceptance rates, or ranking in the top 20 on major college ranking lists, says Haas. Set aside the highest financial aid offer, then ask other schools if they can match it.

That is what Catherine Valega is doing. Valega, the mother of a high school senior, lives in Winchester, Massachusetts, where her daughter is still deciding which school she will go to. Financial aid is a big part of that decision, she says.

“My daughter got into four or five schools that she’s excited about, and some of the aid packages are juicier than others,” says Valega. She asks everyone if they can match or beat the main offer.

“She has excellent grades, lots of activities, and a bilingual, multicultural family,” Valega says of her daughter. “If your child is an attractive candidate for the schools, ask her. You don’t get what you don’t ask for.”

To support her request, Valega’s daughter is sending copies of offer-aid letters from other schools. “You can’t make up the numbers,” she says.

Unlike questions about need-based aid, requests for more merit aid must come from the student. Send them to the admissions office.

It is also possible to apply for more merit aid for a student who only has one financial aid offer, although it is not as likely to be successful.

“You have to give them an excuse to give you more money,” says Haas. Perhaps an academically gifted student has won academic awards that the university does not yet know about, or a talented actor has won a leading role in a play. Tell it to the university.

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Tips to improve your chances of success with any type of financial aid

Some tips are always applicable, no matter what kind of help you would like to increase.

  • Use the correct terms. Yes, you are negotiating, but “appeal” is the word to use in your conversations with colleges.
  • The lyrics are good. In-person appointments are better, if you can get one. The student and parent must attend.
  • Be honest, enthusiastic and very polite. Your student would love to attend the school in question. You’re just asking the university to make it more possible. Don’t make demands or say that the college would be lucky if your student attended.
  • Ask for a specific amount. “The more specific you can be, the better,” says Matthew Smartt, a financial planner in Belmont, Michigan. “There is a fine line between being specific and being greedy, and where that line is depends on the situation. Use other offers as a reference.” For example, if you have help offers of $25,000, $29,000, and $33,000, you can receive all three offers up to $33,000, but you probably won’t take any of them to get a $60,000 help offer.
  • Follow up. If you don’t get a response within a week or so, check with the university. But if the answer is no, don’t become a pest. “The chance that they’ll get to something after they’ve said no is close to zero,” says Haas. “The only way I can imagine it is if there is any significant new information.”

The worst that can happen if you ask for more help is that a university refuses. “They’re not going to rescind the admission offer or give you less help than you had to start with,” says Smartt.

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