What is Financial Aid EFC Score 00000?

Your EFC Number Demonstrates Exceptional Financial Need

How Do You Interpret Your EFC Score?

First, if your adjusted gross income is below $24,000 for the 2013 base year, you have an automatic EFC 00000. Important, this does not mean you pay nothing for college, read further to understand why.

Secondly, if your income is below $50,000 you qualify for the “simplified needs test” which means both the parent’s and student’s assets are not counted in the EFC calculation.

Colleges use your EFC number to determine your financial aid need compared to other applicants that will be attending their school.

The lower your EFC score the greater your financial need.

Basic formula, total cost of attendance minus your EFC number equals your family financial need.

When your score is o0000 colleges consider your financial aid need “exceptional” and often times use  the term “full-need student” (not to be confused with “need met” by each college explained below).

What does your EFC number mean if it is not 00000?

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[Strategy Alert]: As referenced above, your EFC number is subtracted from the total cost of attendance of each school to arrive at a financial need number. However most schools do not meet 100% of  your financial  need number when they provide you with a financial aid award.

Learn about what financial need  met  means and how your EFC number integrates into a percentage formula.

Even families with an EFC of Zero can end up with a funding gap. Say the school only meets 70% of financial need, that means as a general guideline the family will be probably responsible for 30% of the total cost of attendance.

Note, when the school values the student they might meet 100% of  financial need, or 90% so again these are just guidelines but great “student positioning” with the right school can yield 100% offers. But at the same time the school may choose to provide a very low percentage of financial need.

If you have an EFC of $20,000, the college meets 70% of financial need, this leaves you with 30% of unmet need (Example, total cost $40,000 less EFC equals financial need of $20,000 times  30% unmet need $6,000.

So your theoretical out of pocket costs would  be your EFC $20,000 plus unmet need of $6,000 equals $26,000.

Unfortunately the actual financial aid awards can vary because the average need met is an average number for the student population (incoming freshman and upperclassmen) at the school.

EFC Families 00000 Eligible for Federal Aid Programs

These applicants are eligible to receive “needs based financial aid” and can qualify for certain favorable federal educational assistance programs.

  • Pell Federal Educational Grants (money that does  not  have to be  paid back)
  • Federal Work-Study Program (does not count as financial aid income for student)
  • Perkins Loans
  • Subsidized | Unsubsidized Stafford Loans

You will see these programs in the financial aid award example below.

Financial Aid Award EFC 00000 Family Flagship State School
Award  Financial Aid Description
Loans
Subsidized Direct Loan $3,500
Federal  Perkins Loan $2,000
Unsubsidized Direct Loan $6,000
Total Loans $11,500
Grants School $4,000
Federal Pell Grant $5,645
Total Grants $9,645
Scholarship Student Won $2,000
Federal Work Study $2,000
Total $4,000
Total Cost of Attendance +$43,500
Less Total Financial  Aid Award         -$25,145
Unmet Need”  “Funding Gap $18,355

 

Graduation Cap Black with Black Tassel[Strategy Alert]t: The above family contacted us after they lost their initial appeal. They joined our  Coaching Program where we prepared their appeal. The family received an additional $9,500, $6,000 was College Free money – grants. In addition, this school only meets 65% of  financial  need and this award is  heavy in loans. The family was totally unaware of this need met percentage assuming with a zero EFC their out-of-pocket costs would  be minimal.

 Your School Must Be Title IV Eligible to Receive Pell Grants

Most schools are but some are not so you need to check this out.

An EFC of 0000 would qualify for up to the 20130-2014 maximum of $5,645.

Pell Grant Award Amounts 2014-2015 by EFC and Cost of Tuition

Federal Pell Grant Award Chart 2014-2015

Pell Grants are awarded based upon;

  • Financial Need Expected Family Contribution Number
  • Enrollment Status
  • Cost of Attendance (If this is lower than $5,645 then you will not receive the full amount even though your EFC 0000 would qualify because the grant is only eligible up to the total cost of attendance until the maximum is reached).

What Are Perkins Loans?

Loans that have a favorable interest of 5% when compared to other alternatives.
Perkins loans are campus-based meaning decisions are  made  the college you are attending.
Here  some other points of  clarity;
  • Available for students with exceptional  financial need (EFC 0 qualifies),
  • No interest rate is charged while the student is in school at least half-time,
  • Repayment starts 9 months after graduation.
  • Available for both undergraduate and graduate study,
  • Maximum loan amount per year / aggregate maximum undergraduate $5,500/$27,500 and graduate, $8,000/$60,000.

You Will Be Offered Stafford Loans – You Don’t Have to Accept

You will be guaranteed a Stafford Loan; it will probably be a subsidized Stafford that provides better loan provisions up to the maximums listed below.

Stafford Loan eligibility differs from Pell Grant as you only have to be enrolled or plan to be enrolled half-time.

First Year $5,500 ($3,500 subsidized/$2,000 unsubsidized)
Second Year $6,500 ($4,500 subsidized/$2,000 unsubsidized)
Third Year Beyond $7,500 ($5,500 subsidized/$2,000 unsubsidized

Apply As Early Each Year As You Can Before Priority Aid Deadline

Each year in college you will be required to submit your Financial Aid Application (some privates also require CSS Profile). It is important to determine if there are any early deadlines for the CSS Profile.

For CSS Profile make sure you file before the schools Priority Aid Deadline date which is the day the college starts building financial aid packages.

Best Practice for the FAFSA is to file as soon after January 1 as possible so you are at the front of the line. Schools process incoming freshman packages first then move on to upper returning students.

Once your FAFSA is processed you will receive a Student Aid Report that shows your processed EFC number.

An asterisk will appear next to your EFC number if you are selected verification.

There are EFC codes inside the the SAR Report some will require action on your part to correct mistakes/incorrect information.

State Funded and Institutional Funded Financial Aid

You may also be eligible for funds directly from your school. Regardless of you EFC number you can only project the amount of financial aid you will receive based upon the historical giving pattern of the respective school.

If you have questions please fee free to contact me.
Email: jimkuhner@CollegeSelectionStrategy.com