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Financial Aid 101

How Your Financial Aid Offer
is Determined

University of Denver Financial Aid

We get many questions about how financial aid offers and amounts are determined. While the process is admittedly complicated, we hope this email will help you understand the basics of DU's financial aid eligibility policies.

Merit Scholarships
You are automatically considered for merit scholarships when you apply for admission to DU. This means your FAFSA and CSS Profile are not used to determine your eligibility, and you will be notified in your admission letter if you are awarded a merit scholarship. The amount you receive is determined by your admission application. If your academic profile is near our average, you are potentially eligible for a scholarship.

Important note for music majors: Students applying to the Lamont School of Music are holistically considered for a comprehensive scholarship (ranging from $1,000 to full tuition) that takes talent, academic merit, and financial need into consideration. This means students who are awarded a music scholarship are not eligible to receive an admission merit scholarship or any institutional need-based grants.

Need-Based Aid
You must have financial need to be eligible for need-based aid. So how exactly is financial need calculated? To explain, we need to first examine your Expected Family Contribution (EFC).

What is my Expected Family Contribution?
Your Expected Family Contribution (EFC) is a measure of your family's financial strength and an estimate of how much of your family's financial resources should be available to help pay for your education. It is not intended to represent a minimum or maximum dollar amount that you and your family are required to pay DU. Instead, it's a number we use as a benchmark to determine eligibility for need-based aid.

How is my EFC calculated?
Your EFC is determined from the data you provide on your financial aid application. Family income is only one of several factors involved. Other important factors include the number of members in your household, the number of other siblings attending college, and financial assets. If you submit both the FAFSA and CSS Profile, you will have two EFCs: one calculated using Federal Methodology and one calculated using Institutional Methodology.

  • Federal Methodology (FM): This formula is used to determine eligibility for all federal aid, including Pell Grants, Direct loans, work-study, and Colorado state aid. Your FM EFC is determined using the data provided on your FAFSA. This EFC calculation excludes some forms of income and expenses and eliminates some assets from consideration. Once you submit the FAFSA, you can see your FM Expected Family Contribution by logging into your FAFSA and viewing your Student Aid Report.
  • Institutional Methodology (IM): Many colleges and universities that offer institutional scholarship funds use some variation of Institutional Methodology as established by the College Board. DU uses it to determine your eligibility for institutional aid, such as the DU Educational Grant. Your IM EFC is calculated using the data provided on your CSS Profile. This EFC calculation excludes certain losses and includes several income and asset factors not considered through the FM formula (such as tax-deferred income and equity in the home). We believe that, in most instances, this method more accurately determines a family's ability to pay for college.

How is "financial need" determined?
Your financial need is calculated by subtracting your Expected Family Contribution from your total cost of attendance.

Cost of Attendance - EFC = Financial Need

How does this impact my financial aid offer?
Once we know your financial need, we can determine your eligibility for need-based aid. An important thing to remember is that the total amount of your need-based aid cannot exceed your financial need.

DU Need-Based Aid:
The University of Denver is not able to meet the full demonstrated need of all students who apply for financial aid. However, we do meet a portion of financial need with institutional need-based aid—namely, the DU Educational Grant (DUEG). The amount of DUEG funding you may be eligible to receive is tied to your merit scholarship. In other words, the more financial need you demonstrate and the higher your merit scholarship, the more you will receive in a DU Educational Grant.

Federal Need-Based Aid:

  • Federal and State Grants: This type of aid—which includes the Federal Pell Grant, the Federal Supplemental Educational Opportunity Grant (SEOG), and the Colorado Student Grant—is offered to students who have a very low FM EFC.
  • Work-Study: While there is no maximum EFC to be considered for work-study, you must still have financial need after other need-based aid has been added to your financial aid offer (remember that the total amount of need-based aid cannot exceed your financial need). However, since funding is so limited, work-study is offered through a lottery system. Therefore, not everyone who would otherwise be eligible is offered work-study.
  • Direct Subsidized Loan: If you still have financial need after the other types of need-based aid have been added to your financial aid offer, you will be offered a Direct Subsidized loan for up to $3,500.

Non-Need-Based Aid

  • Direct Unsubsidized Loan: All students who submit the FAFSA will be offered a Direct Unsubsidized Loan since this loan does not require financial need.
  • Parent PLUS Loan: Although it will not be automatically included in your financial aid offer, the Parent PLUS Loan is a credit-based loan that does not require financial need. It cannot exceed your total cost of attendance, however.

That's it for this week! We hope this email has helped shed some light on what can be a very confusing process.

Want to review past Financial Aid 101 emails? Check out the archives!

Up next week: Comparing Financial Aid Offers


We're here to help you.

Send us an email at
or call us at (303) 871-4020

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