Financial Aid

Financial Aid

Are you ready to test your knowledge about financial aid? This ten-question multiple-choice quiz will explore different student loan options and how they work. After completing all ten questions, click "Grade Me!" at the end of the quiz to see how you did.

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When going through the financial aid qualification process, "EFC" stands for?
The Expected Family Contribution (EFC) is a formula established under Federal law that is used to measure your family's financial health for purposes of awarding financial aid. EFC uses your family's taxable and nontaxable income, accumulated assets, and benefits (such as unemployment or Social Security) as part of the EFC calculation.

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The application used by nearly all colleges and universities to determine eligibility for federal, state, and college-sponsored financial aid is known as ___________.
FAFSA or the Free Application for Student Financial Aid is used by nearly every college and university in making financial aid decisions. FAFSA has gone through reviews and updates since its inception; The Higher Education Amendments of 1992 created it. FAFSA merged the previously used Pell Grant Formula with the Congressional Methodology to yield the Federal Methodology (FM).

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Which of the following are NOT advantages of Federal student loans over private student loans?
Congress sets up the interest rates on Federal student loans and is the same for all students receiving either subsidized on unsubsidized student loans. Rates will be different for subsidized versus unsubsidized loans, with subsidized loans being awarded based on financial need. There are also other rate structures for undergraduate and graduate loans. Credit checks are not required. Federal loan rates finish in the spring so that they can qualify for the upcoming award year. Each loan has a fixed interest rate for the loan's life and offers different and flexible repayment methods. It is possible to consolidate multiple loans into a single loan for repayment.

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Which of the following type of student loans is subsidized by the federal government?
Stafford and Perkins student loans are the two main types of federal student loans. They're often awarded to students at the same time and have a few similarities. Eligible undergraduate and graduate students who are enrolled at least half-time qualify for Stafford Loans. Subsidized Stafford Loans are awarded based on financial need, and the federal government pays the interest which accrues. Eligible students without regard to their economic condition qualify for Unsubsidized Stafford Loans; however, they are responsible for paying all interest. Full- or half-time undergraduate and graduate students, based on financial need, qualify for Perkins Loans. The loans depend on the school you are attending and are repaid to the school. The interest rate on these loans varies, and the repayment term is generally ten years.

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Which of the following types of Federal financial aid does not have repayment requirements?
A Federal Pell Grant, unlike a loan, does not have to be repaid. Pell Grants usually are awarded only to undergraduate students who have not earned a bachelor´s or a professional degree. Grant amounts can change annually and are based on your financial need, cost of attendance, full-time or part-time student status, and ​your plans to attend school for a full academic year or less. Both Perkins Loans and Stafford Loans are Federal loan programs that require repayment.

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What is the current aggregate total Stafford loan limit for unsubsidized loans for dependent undergraduate students?
There are limits on the amount of subsidized and unsubsidized loans that undergraduate students can receive for undergraduate and graduate study. These are aggregate loan limits. The current limit is $31,000, with no more than $23,000 of subsidized loans. If the total loan amount you receive throughout your education reaches the aggregate loan limit, you cannot receive additional loans.

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What is the maximum amount that can be borrowed annually by a parent of a dependent undergraduate student under the Direct PLUS loan program?
The annual maximum loan amount a parent can borrow is their child's cost of attendance minus other financial aid. For example, if the child's cost of attendance is $6,000, and he or she receives $4,000 in other financial aid, the parent can borrow up to $2,000 in PLUS Loans.

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The Federal Work-Study Program may result in your student being employed by which following types of employers?
The Federal Work-Study Program provides part-time jobs for undergraduate and graduate students who have demonstrated financial need. It allows them to earn money to help pay education expenses. The program encourages community service work and work related to the student’s course of study. On-campus and off-campus opportunities are frequently provided. On-campus options are usually offered by the school, while private nonprofit organizations or public agencies usually offer off-campus opportunities. All work performed under the Work-Study program must be in the public interest.

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A great place to look for scholarship opportunities would be?
US News & World Reports list five best places to look for financial aid. Those include your school, local library, employers, and free online scholarship searches. Additionally, community organizations such as the Boy Scouts or Girl Scouts and 4-H Clubs often offer scholarship programs, as do your local bank or credit union.

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Which of the following types of student loan repayment terms would result in you paying the least?
For all loan programs, interest is paid or accrues based on the outstanding loan balance and interest rate. The quicker you lower that loan balance, the less interest you'll pay over the term of the loan. Shorter-term loans with the same interest rate will cost less than longer-term loans because your loan balance will decrease more rapidly.

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