Is There a Better Offer Available? You Will Never Know if You Don’t Ask.
You may be very happy with the financial aid offer you’ve received from the colleges to which you’ve applied so you may be asking yourself, “Why negotiate?” The simplest argument for appealing your financial aid offer is that doing so is one way to ensure that you are receiving the best possible financial aid packages from the colleges. If that isn’t reason enough, here are 4 real world cases for negotiating.
Four Reasons You May Want to Negotiate Your Financial Aid Offer
- Schools Can Make Mistakes
- Schools May Under-Award
- Some Colleges Will Compete with Other Schools
- Extenuating Family Circumstances
Schools Can Make Mistakes
Schools are run by people, and while they make every effort to process all those applications error-free, sometimes people make mistakes. If a mistake is made in your situation, you want to be able to identify the error and know how to work with the university to correct it.
A student’s mother called Scott to let him know that her son’s first choice school had returned their financial offer and it was not near what they had hoped. Somehow, it was off what Scott and the family had projected by an unbelievable 100%. Scott is no math whiz, but this made no sense. He worked with the family to draft an appeal letter which they emailed to the school and followed-up with a phone call. Turns out the financial aid office had switched the student’s social security number with another applicant. The correction was made, the financial offer reworked and the student’s final aid package ultimately came in within 3% of Scott’s projections.
Schools May Under-Award
Frankly, it is our opinion that some schools have a policy of low-balling you. These schools will only offer as much as they think will get the average student to their school and you may have to work to get the maximum offer available to you.
Some Colleges Will Compete with Other Schools
It can be a very fun situation when schools start competing for you. An instance comes to mind of a student who had applied to two schools in Iowa, Waldorf and Wartburg. Unbeknownst to us at the time, these two schools have a very competitive history with one another.
One afternoon, the financial aid officer from Wartburg called the student and says he noticed on her FAFSA that she had applied to Waldorf. He asks if she would send him Waldorf’s financial aid offer when it came in the mail. She agreed and when Waldorf’s offer showed up later that week, she faxed it off to Wartburg. Wartburg’s immediate response was “we can beat that by $500 a year,” and he sent the improved financial offer letter to the client. Well, we’re no dummies, so we immediately forwarded Wartburg’s letter to Waldorf. Waldorf said, “Well, we can beat that by $500 per year,” and the next award letter arrived.
We carried on with this exercise and increased the student’s aid offers by over $2,000 per year. Then she decided to go to Drake University.
REMEMBER: All of the colleges you list on your FAFSA application will see the other schools you have listed on the form. You want to make certain they see a list of competitive schools on the FAFSA form with strong financial track records. If you only apply to one or two colleges, then the financial aid officers will know they have the upper-hand. If they have no competition, you are not likely to get a good offer.
Extenuating Family Circumstances
Sometimes the numbers don’t tell the whole story and unfortunately, the FAFSA only looks at the numbers. Things like layoffs or job changes can impact your financial situation and be cause for reconsideration of your financial aid offer by the colleges to which you’ve applied.
For example, say your father changed jobs last year and took a significant pay cut in doing so. To ensure the monthly paycheck covered all the bills, he withdrew a chunk of money from his 401(k) to pay off some outstanding debt. To FAFSA, the withdrawal from the 401(k) looks like income. So now instead of a $68,000 annual salary, FAFSA believes your dad made $104,000. This can have a huge negative impact on your eligibility for financial aid.