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Minnesota State University, Mankato

Minnesota State University, Mankato

Types of Financial Aid

Page address: http://www.mnsu.edu/campushub/fafsant/descriptions/

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For the 2014-2015 School Year

Minnesota State Mankato
School Code: 002360


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There are four major types of student financial aid programs available to students who submit a FAFSA application and have eligibility.

| Grants | Scholarships | Workstudy | Loans |

Grants

Grants, also often referred to as gift aid, are funding sources that students are not required to repay.  Grants are considered NEED-based and eligibility for Federal Grant programs and most State Grant programs is based on the family’s (student and parent) income.  The Federal Pell Grant program is the most well-known grant program currently available to students.  Most states have grant programs as well.  Some grant funding may be limited, therefore eligible students are often required to respond to the financial aid office deadlines to maintain their eligibility for those grant funds.  Contact the financial aid office at your institution for more information about the different grant programs they offer.

Scholarships

Generally, scholarships are funding sources that do not have to be repaid.  However, there are some scholarship donors that provide very "low-interest loans" to students that may or may not require repayment.  Most scholarship funding is provided by resources that are not part of the Federal and State financial aid programs, for example, institutional funds or funds from outside sources like civic groups or corporate organizations.  Most scholarships from outside sources do not require a student to fill out the FAFSA. 

Students are always encouraged to seek out scholarship funding from these different sources.  Scholarships assist students in financing their education, they provide networking opportunities for students and are positive additions to a student’s resume.  Because scholarship funds contribute to the student’s educational funding, and require no repayment, all scholarship funding must be added to the student’s financial aid award eligibility.  Always contact the financial aid office if the student is receiving a scholarship from an outside source to prevent the student from repaying all or a portion of their student financial aid. 

There are several resources that can help students find scholarship funding.  Students should check with their High School Guidance Counselor, the college’s Admission’s Office, Office of Financial Aid, the department they plan to major, civic groups such as the Kiwana’s Club and/or Elk’s Lodge, etc.  Students may also access scholarship information on the internet.  One of the best scholarship search engines is located at www.fastweb.com

MSU College and Department Scholarships

Scholarships and Resources Websites

NOTE: There are several companies that offer scholarship search assistance to students and parents.  A number of the companies that claim to assist students and families in obtaining scholarships and other financial aid have been labeled as scams.  A good rule of thumb, if the company requires a payment for it’s services, it is generally not worth the money.  There are plenty of free resources available to students.  For more information about scholarship scams visit www.finaid.org

Work-Study

Work-study programs (Federal and State) provide funding for students through employment.  Work-study is considered a NEED-based program.  Most work-study positions are located on campus, some off-campus sites are also available.  Some institutions place students in positions, other institutions require students search and interview for work-study positions.  Contact the financial aid office at your institution to find out more about how eligible students are placed in work-study positions.

Students gain more than income from most work-study experiences.  Research shows that students who participate in work-study and other on-campus employment achieve higher grades, feel more involved in the institutions and are able to network with other students, faculty and staff.  Students will also have a work experience to include on their resume.  Minnesota State University, Mankato Student Financial Service matches student's skills and experience with jobs.

Loan Programs

The Federal Direct Subsidized and Unsubsidized loans are low-interest, educational loans guaranteed by the Federal Government.  The Subsidized Federal Direct Loan is considered a NEED-based loan; therefore, the federal government pays the interest on the loan while the student is in school.  The Unsubsidized Federal Direct Loan is considered a Non-NEED-based loan.  The Unsubsidized Federal Direct Loan may be awarded (depending on institutional policy) to students who did not have a demonstrated NEED, or whose NEED portion of their budget has been met, but still have room in their overall Cost of Attendance for more funding and have remaining Federal Direct Loan eligibility.  Because the Unsubsidized Federal Direct Loan is considered a Non-NEED based loan, the federal government DOES NOT pay the interest while the student is in school.  It is the student’s responsibility to pay accrued interest while in school, or choose the option to capitalize the interest.

The following are examples of student financial aid awards:


The first example is for a student with an EFC* of 2050.
 

Cost of Attendance (COA)  13,182
Estimated Family Contribution (EFC) - 2,050
NEED 11,132

For this example, the student is a first-time entering freshman, Dependent status, Minnesota resident.
*Based on a parent contribution of $1500, student contribution $550.

Based on the student’s COA - EFC = NEED, the student would be awarded the following:
 

Federal Pell Grant 1,500
MN State Grant 1,680
Non-Institutional Scholarship 1,000
Work-Study 1,475
Subsidized Federal Direct Loan 2,625
Total Need Based Aid  8,280

The Pell Grant and MN State Grant do not have to be repaid.  The Non-institutional Scholarship came from a funding source outside of the institution.  This student invested time and energy into researching and applying for additional educational funding through scholarship, and it paid off by $1,000.  In order for the student to fully benefit from the work-study funding available, he/she will be required to work the number of hours designated for this award.  Wages and the placement process for work-study varies from institution to institution.  The Federal Direct Loan program has annual limits for dependent and independent students based on their grade classification.  The maximum Federal Direct Subsidized and/or Unsubsidized funding for a dependent freshman student is $2,625.00

This award package provides $8,280.00 in Student Financial Aid funding.  To meet the total Cost of Attendance of $13,182, the family will need to contribute $4,902.  If the family is unable to contribute the funds out-of-pocket, there are other educational loan funding sources families can access to help cover those costs.  Contact your institution’s financial aid office for more information on other loan funding resources (i.e. PLUS Loan, Alternative Loans) or visit the loan section of this MSU Student Financial Services Website.

Also, always keep in mind, the Cost of Attendance usually includes indirect educational costs such as transportation, laundry, etc.  Students and their families should take a close look at the type of expenses the student is going to have before taking out loan funding.  A student who plans on living at home may not require as much funding for housing expenses.  The indirect costs portion of the COA is something that can, to a certain extent be controlled by the student.  Budgeting for an education is critical.


The second example is for a student with an EFC of 10,000.
 

Cost of Attendance (COA) 13,182
Estimated Family Contribution - 10,000
NEED 3,182

For this example, the student is a first-time entering freshman, Dependent status, Minnesota resident.

Based on the student’s COA - EFC = NEED, the student would be awarded the following: 

Non-institutional scholarship 1,000
Subsidized Stafford Loan 2,182
Unsubsidized Stafford Loan 443
Total Student Financial Aid 3,625

The Non-institutional Scholarship came from a funding source outside of the institution.  This student invested time and energy into researching and applying for additional educational funding through scholarship, and it paid off by $1,000. 

The Federal Stafford Loan program has annual limits for dependent and independent students based on their grade classification.  The maximum Stafford Subsidized and/or Unsubsidized funding for a dependent freshman student is $2625.00.  For this example, the student was awarded a combination of Subsidized and Unsubsidized funds to equal $2625.

This award package provides $3,625 in Student Financial Aid funding.  To meet the total Cost of Attendance of $13,182 after the financial aid award of $3,625 is deducted, the family will need to contribute $9,557, as part of the EFC is covered by the Unsubsidized Stafford.  If the family is unable to contribute the funds out-of-pocket, there are other educational loan funding sources families can access to help cover those costs.  Contact your institution’s financial aid office for more information on other loan funding resources (i.e. PLUS Loan, Alternative Loans) or visit the loan section of this MSU Student Financial Services Website.

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