EFC: How Your Expected Family Contribution Affects Financial Aid

Filling out the Free Application for Federal Student Aid (FAFSA) for the first time can feel overwhelming. One way to lessen this confusion is to learn how your FAFSA results are used to determine the federal financial aid you qualify for — such as understanding how your Expected Family Contribution (EFC) is calculated and what it means.

What does your EFC number mean on your FAFSA?

Your Expected Family Contribution is calculated based on your FAFSA information and is used by financial aid offices to determine how much federal financial aid you qualify for. Keep in mind that your EFC isn’t the amount of money your family will be expected to provide for your education or your exact federal financial aid amount — it’s simply part of the equation.

How is your EFC calculated? There are three formulas used to calculated EFC:

Formula A for dependent students
Formula B for independent students without dependents other than a spouse
Formula C for independent students with dependents other than a spouse

You can find the worksheets used to determine EFC on the Federal Student Aid Partner Connect website. Don’t worry — because you have to complete the FAFSA to get your official EFC anyway, you don’t have to figure out your EFC manually using the worksheets.

Once your EFC has been calculated, your school’s financial aid office will subtract it from your cost of attendance — this number is how much you qualify for in need-based aid. They’ll then subtract any need-based financial aid you’re awarded from your cost of attendance to determine what non-need-based aid you’re eligible for.

Keep in mind: Your school’s cost of attendance is based on several factors, including tuition, fees, room and board, books, supplies, transportation, and other basic living expenses.

Learn More: Federal Stafford Loans

What factors determine your EFC?

The information you provide in the FAFSA is used to determine your EFC. Here are a few of these factors as well as how they’re typically weighted in the calculation for dependent students:

Program	Weight	Excluded income
Student income	50%	$6,750
Parent income	22% to 44%	Varies based on the number of dependents and number of students in college
Student assets	20%	529 plans in student’s name before disbursement (disbursements and 529 plans in someone’s else name are considered student income)
Parent assets	2.6% to 5.64%	529 plans in parent’s name before disbursement (disbursements and 529 plans in someone’s else name are considered student income)

Keep in mind: If you’re an independent student, your parent’s income and assets won’t be considered for the EFC. This means you might qualify for more financial aid as an independent student than as a dependent student.

Check Out: 529 Plan: Invest in a College Savings Account Early

How much financial aid will you get based on your EFC?

This will mainly depend on your school’s cost of attendance: Your school’s financial aid office will subtract your EFC from the cost of attendance to determine your financial need. This number is also the maximum amount you can receive in need-based aid — though you might be able to get more in non-need-based aid.

Keep in mind that students who come from households with a low adjusted gross income (AGI) will generally have a lower EFC compared to students from wealthy families. This means low-income students will often be eligible for more financial aid.

For example: Say your EFC is $15,000 and your school’s cost of attendance is $40,000. With this EFC, your calculated financial need would be $25,000. But if you had a higher EFC of $30,000, your financial need would be only $10,000.

Need-based vs. non-need-based aid: what’s the difference?

There are two categories of federal financial aid — need-based and non-need-based aid. Learning the difference between the two can help you better understand your financial aid package and the role of your EFC.

Here’s how they work:

Need-based aid

You must have financial need as well as meet other requirements to qualify for need-based aid. To calculate your financial need, your school will subtract your EFC from your cost of attendance. Your financial need is also the maximum amount of need-based aid you can get.

For example: Say your school’s cost of attendance is $20,000 and your EFC is $8,000. In this case, your financial need would be $12,000 — this would also be the maximum you could get in need-based aid.

There are four types of need-based federal aid, including:

Federal Pell Grants: These are awarded to undergraduate students who demonstrate exceptional financial need. Unlike student loans, Pell Grants don’t have to be repaid.
FSEOG: The Federal Supplemental Educational Opportunity Grant (FSEOG) program is only offered by participating schools. You can check with your school’s financial aid office to see if the FSEOG is available to you.
Direct Subsidized Loans: These are available to undergraduate students with financial need. The government will cover the interest that accrues on these loans while you’re in school.
Federal Work-Study: Undergraduate and graduate students with financial need can get part-time jobs through this program.

Non-need-based aid

Unlike with need-based aid, your EFC doesn’t factor into your eligibility for non-need-based aid. Instead, your school’s financial aid office will subtract the financial aid you’ve been awarded so far (such as school-based aid and private scholarships) from your cost of attendance — this number is how much you qualify for in non-need-based aid.

For example: Say your cost of attendance is $20,000. If you’ve already received $12,000 in need-based aid, you might qualify for up to $8,000 in non-need-based aid.

There are three types of non-need-based aid, including:

Direct Unsubsidized Loans: These are available to both undergraduate and graduate students. Unlike with subsidized loans, you’re responsible for all of the interest that accrues on unsubsidized loans.
Direct PLUS Loans: There are two kinds of PLUS Loan — Grad PLUS Loans for graduate students and Parent PLUS Loans for parents who want to pay for their child’s education. The interest rates on these loans are higher compared to most other federal loans. PLUS Loans also require a credit check.
TEACH Grant: To be eligible for a Teacher Education Assistance for College and Higher Education (TEACH) Grant, you must agree to serve as a full-time, highly-qualified teacher at a low-income school or educational service agency for four years. Additionally, you must teach in a high-need field.

Learn More: Subsidized vs. Unsubsidized Student Loans: Know the Difference

How to appeal your EFC

After you submit the FAFSA, your school will send you a financial aid award letter detailing the financial aid you qualify for. However, if your financial situation changes, you might be able to appeal your EFC or get additional help from your school if your financial situation changes — for example, if you’re faced with a death in the family, a serious illness, job loss, or divorce.

If you’re ready to appeal your EFC, here’s what to do:

Contact the financial aid office. Some schools have specific funds set aside for students with an unexpected financial need or have resources to help you make up the difference between your family’s ability to pay and your education costs. Ask your school’s financial aid office what help is available for you.
Request more financial aid. This will also be done through the financial aid office. Make sure to include information on how your circumstances changed and how much additional aid you need.

Check Out: Student Loan Interest Calculator: Estimate Payments

The Student Aid Index will replace the EFC in 2023

As part of the FAFSA Simplification Act, the EFC will be replaced with the Student Aid Index (SAI) starting on July 1, 2023. The main reason for this change is to reduce the confusion surrounding the term “Expected Family Contribution” — this is often mistaken to mean either the amount your family has to come up with to support your education or the amount of federal aid you’ll get.

Updating this system is expected to help clear up these misunderstandings as well as highlight how this number is actually used — as a part of financial aid calculations.

In addition to changing the name, some of the ways that the SAI will change the current EFC system include:

Fewer questions: The FAFSA will have a maximum of 36 questions instead of the current 108 with the EFC system. Low-income families will have the fewest questions to answer.
Pell Grant eligibility: You’ll be able to see if you qualify for a Pell Grant before applying.
Suspension eliminations: Students will no longer need to answer questions regarding drug-related convictions or Selective Service System registration.
Asset information: In some cases, assets won’t be considered in financial aid calculations for low-income students and parents.
Range: With the EFC, the lowest number you can qualify for is $0. But with the SAI, the lowest number will be -$1,500 — which means you could receive more aid to cover other expenses outside of the school’s cost of attendance.
Special circumstances: Financial aid officers will have the power to adjust the cost of attendance or components of the SAI on a case-by-case basis. This means that students facing exceptional circumstances might be able to get more aid.

Consider private student loans to fill in the financial gaps

If your federal financial aid isn’t enough to cover your school costs, private student loans could help fill the gap. While private student loans don’t offer the same benefits and protections that federal student loans do, they can be an important part of paying for school.

Before taking out a private student loan, be sure to shop around and consider as many lenders as possible to find the right loan for you. Credible makes this easy — you can see your prequalified rates from our partner lenders in the table below in just two minutes.

Lender

Fixed (APR)

Loan Amounts

Min. Credit Score

4.8

Credible rating

3.69% - 15.28%

$2,001 to $400,000

Does not disclose

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Overview

While Ascent provides traditional student loans for undergraduate, graduate, and medical programs, it also stands out with some options that are uncommon among private student loan lenders. For example, its Outcomes-Based Loan, which doesn't require established credit or a cosigner, is available to juniors and seniors. When assessing your application, Ascent considers factors including your school, major, and GPA to determine if you're eligible.

Ascent also offers its Progressive Repayment plan to qualified borrowers. It allows you to begin with smaller payments at the start of the repayment term and then gradually pay more each month over time. If you borrow with a cosigner, they can be released after you make as few as 12 monthly payments. However, cosigners for loans for international students do not qualify.

pros

Doesn’t charge application fees or origination fees
Offers discounts of 0.25 to 1 percentage points when using automatic payment
Can get a 1% cash-back reward after you graduate
Grace periods from 9 months to 36 months

cons

May find lower interest rates with some competitors
International students don’t have option to release cosigners

Interest rates

Fixed or variable

Minimum credit score

Does not disclose

Minimum income

Does not disclose

Loan terms

5, 7, 10, 12, 15, or 20 years

Loan amounts

$2,001 minimum up to your school’s annual cost of attendance; lifetime limits of $200,000 for undergrads and $400,000 for graduates

Cosigner release

12 months

Eligibility

Must be a U.S. citizen or DACA student enrolled at least half time at an eligible institution. International students with a qualified cosigner may also qualify. Applicants who can’t meet financial, credit, or other requirements may qualify with a cosigner.

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4.8

Credible rating

3.99% - 15.61%

$1,000 to $350,000 (depending on degree)

720

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Overview

Citizens Bank offers private student loans for undergraduate and graduate students, as well as parents. With its multiyear approval option, you can apply for a loan once, and as long as you qualify, you won't need to reapply each year. This means you can secure loans for future academic years without multiple hard credit checks.

Citizens borrowers can also take advantage of interest rate discounts. If you or your cosigner has an account with Citizens Bank, you can reduce your rate by 0.25 percentage points. Another 0.25 percentage points can be shaved off by enrolling in automatic payments, giving you the chance to lower your rate by up to 0.5 percentage points.

pros

Multiyear approval lets you secure funding for future school years
You can reduce your rate by 0.5 percentage points with autopay and loyalty discounts
International students can apply with a qualified cosigner

cons

Fewer repayment terms to choose from than some other lenders
Long wait time for cosigner release
Parents can’t defer payments while student is in school

Interest rates

Fixed or variable

Minimum credit score

Does not disclose

Minimum income

Does not disclose

Loan terms

5, 10, or 15 years for student loans; 5 or 10 years for parent loans

Loan amounts

$1,000 minimum, up to a maximum of $225,000 for undergraduate and graduate degrees; $300,000 for MBA and law; and $225,000 or $400,000 for health care student loans, depending on the degree type

Cosigner release

36 months

Eligibility

Must be a U.S. citizen or permanent resident enrolled at least half-time in a degree-granting program at an eligible institution. International students can apply with a cosigner who’s a U.S. citizen or permanent resident.

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4.9

Credible rating

3.47% - 17.99%

$1,000 up to 100% of the school-certified cost of attendance

Does not disclose

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Overview

College Ave offers student loans for almost every type of degree program, with a range of repayment options, including a unique eight-year repayment term. Additionally, you can get extended grace periods of as long as 36 months on graduate, dental, and medical student loans.

It's also possible to get loan approval for multiple school years at one time. About 90% of undergraduates applying with a cosigner are approved for additional student loans. However, you must complete at least half of your repayment term before you can remove a cosigner for your loan. Some lenders allow cosigners to be released much sooner, after as few as one to two years of payments.

pros

Rate discount of one-quarter of a percentage point for using autopay
Does not charge origination or application fees
May qualify for multiyear approval
Grace periods between 9 and 36 months for graduate, MBA, law, dental, and medical school loans and 36 months

cons

Parents borrowers are required to pay at least the interest while the student is in school
Cosigners not eligible for release until at least half the repayment term of the loan is completed

Interest rates

Fixed or variable

Minimum credit score

Does not disclose

Minimum income

Does not disclose

Loan terms

5, 8, 10, or 15 years for most borrowers (law, dental, medical, and other health profession students have up to 20 years)

Loan amounts

$1,000 minimum up to your school’s annual cost of attendance; lifetime limits depend on your degree and credit profile

Cosigner release

Available after more than half of the scheduled repayment period has elapsed and other requirements are met

Eligibility

Must be a U.S. citizen or permanent resident at an eligible institution. International students with a Social Security number and a qualified cosigner may also qualify. Applicants who can’t meet financial, credit, or other requirements may qualify with a cosigner.

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4.4

Credible rating

4.24% - 14.02%

$1,000 to $99,999 annually $180,000 aggregate limit)

Does not disclose

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Overview

pros

Multiyear approval lets you secure funding for future school years
You can reduce your rate by 0.5 percentage points with autopay and loyalty discounts
International students can apply with a qualified cosigner
Offers parent student loans

cons

Fewer repayment terms to choose from than some other lenders
Long wait time for cosigner release
Parents can’t defer payments while student is in school

Interest rates

Fixed or variable

Minimum credit score

Does not disclose

Minimum income

Does not disclose

Loan terms

7, 10, or 15 years

Loan amounts

$1,000 to $99,999 per year (lifetime limit of $180,000)

Cosigner release

36 months

Eligibility

Must be a U.S. citizen or permanent resident at an eligible institution. You must also meet Custom Choice’s underwriting criteria for income and credit, or apply with a cosigner who does. Eligible noncitizens such as DACA residents can also qualify by applying with a cosigner who’s a U.S. citizen or permanent resident.

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4.6

Credible rating

4.80% - 8.54%

$1,001 up to 100% of school certified cost of attendance

670

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on Credible’s website

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Overview

INvested is an Indiana company that offers affordable student loans exclusively to state residents. Loans are available to Indiana students and parents who can meet income and credit requirements, or who have an eligible cosigner. Borrowers can borrow as little as $1,001 or as much as the school-certified cost of attendance minus other aid.

INvested provides detailed information on eligibility so borrowers can quickly determine whether to apply for a loan — however, there’s no option to prequalify with a soft credit check. Cosigner release is also available after just 12 on-time payments, considerably shorter than many other lenders.

pros

Low minimum borrowing limits
Autopay discount of 0.25 percentage points
Short cosigner release requirements
Transparent qualification requirements

cons

Loans are available only to Indiana residents
No prequalification option to view your rates
No loan options for international students

Interest rates

Fixed or variable

Minimum credit score

670

Minimum income

Does not disclose

Loan terms

5, 10, or 15 years

Loan amounts

$1,001 minimum, up to the school certified cost of attendance

Cosigner release

12 months

Eligibility

Loans are available to Indiana residents only. Borrowers must have a FICO score of 670 or higher, a 30% maximum debt-to-income ratio or minimum monthly income of $3,333, continuous employment over two years, and no major collections or defaults in recent years. Borrowers who do not meet income or credit requirements can apply with a cosigner.

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3.1

Credible rating

5.75% - 8.95%

$1,500 up to school’s certified cost of attendance less aid

670

Check Rates

on Credible’s website

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Overview

Massachusetts Educational Financing Authority (MEFA) offers student loans to borrowers with good credit. However, you won't be able to see your potential rate before applying.

The lender doesn't charge any fees and its rates are competitive, though MEFA only offers two repayment terms. You can add a cosigner to your loan if you're unable to qualify, but only one repayment plan allows you to release your cosigner.

pros

Doesn’t charge any fees
Low maximum rate compared with some lenders
Can borrow up to the school-certified cost of attendance

cons

No discounts for borrowers
Limited repayment terms
No prequalification available

Interest rates

Fixed

Minimum credit score

670

Minimum income

Does not disclose

Loan terms

10 or 15 years

Loan amounts

$1,500 minimum up to school-certified cost of attendance

Cosigner release

48 months

Eligibility

Must be a U.S. citizen or permanent resident, enrolled at least half time at a degree-granting, nonprofit institution, and must maintain satisfactory academic progress. Must have no history of default on an education loan and no history of bankruptcy or foreclosure in the past 60 months. Applicants who can’t meet the minimum credit and income requirements may apply with a cosigner.

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4.3

Credible rating

3.49% - 15.49%

$1,000 up to 100% of school-certified cost of attendance

Does not disclose

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Overview

Sallie Mae offers the Smart Option Student Loan for undergraduate students and a suite of loans for graduate students. You can borrow up to your school-certified cost of attendance and apply just once annually to get the funds you need for the entire academic year. Plus, applying for a Smart Option Student Loan with a cosigner may help you get a better rate.

Through Sallie Mae, you can find a variety of loans designed for specific needs, including loans for MBA programs, law school, medical school, and health profession programs.

pros

Can borrow up to school-certified cost of attendance
No prepayment or origination fees
Loans available to noncitizens with an eligible cosigner
Cosigner release after 12 on-time payments

cons

No parent loan options
No option to check your rates through prequalification
Loan terms not disclosed until after you apply

Interest rates

Fixed or variable

Minimum credit score

Does not disclose

Minimum income

Does not disclose

Loan terms

10 to 15 years for the Smart Option Student Loan; 15 years for law school, MBA, and graduate school loans; 20 years for medical school loans

Loan amounts

$1,000 up to school-certified cost of attendance. Student must be listed as the borrower, and a parent may cosign.

Cosigner release

After you graduate, make 12 one-time principal and interest payments, and meet certain credit requirements

Eligibility

Must be a U.S. citizen or permanent resident enrolled in an eligible program. Noncitizens residing and attending school in the U.S. may qualify by applying with a creditworthy cosigner, who must be a U.S. citizen or permanent resident, and providing an unexpired government-issued photo ID.

Read full review

4.84.8

Credible rating

Fixed (APR)

3.69% - 15.28%

Loan Amounts

$2,001 to $400,000

Min. Credit Score

Does not disclose

Check Rates

on Credible’s website

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Overview

pros

Doesn’t charge application fees or origination fees
Offers discounts of 0.25 to 1 percentage points when using automatic payment
Can get a 1% cash-back reward after you graduate
Grace periods from 9 months to 36 months

cons

May find lower interest rates with some competitors
International students don’t have option to release cosigners

Interest rates

Fixed or variable

Minimum credit score

Does not disclose

Minimum income

Does not disclose

Loan terms

5, 7, 10, 12, 15, or 20 years

Loan amounts

$2,001 minimum up to your school’s annual cost of attendance; lifetime limits of $200,000 for undergrads and $400,000 for graduates

Cosigner release

12 months

Eligibility

Read full review

4.84.8

Credible rating

Fixed (APR)

3.99% - 15.61%

Loan Amounts

$1,000 to $350,000 (depending on degree)

Min. Credit Score

720

Check Rates

on Credible’s website

View Details

Overview

pros

Multiyear approval lets you secure funding for future school years
You can reduce your rate by 0.5 percentage points with autopay and loyalty discounts
International students can apply with a qualified cosigner

cons

Fewer repayment terms to choose from than some other lenders
Long wait time for cosigner release
Parents can’t defer payments while student is in school

Interest rates

Fixed or variable

Minimum credit score

Does not disclose

Minimum income

Does not disclose

Loan terms

5, 10, or 15 years for student loans; 5 or 10 years for parent loans

Loan amounts

$1,000 minimum, up to a maximum of $225,000 for undergraduate and graduate degrees; $300,000 for MBA and law; and $225,000 or $400,000 for health care student loans, depending on the degree type

Cosigner release

36 months

Eligibility

Read full review

4.94.9

Credible rating

Fixed (APR)

3.47% - 17.99%

Loan Amounts

$1,000 up to 100% of the school-certified cost of attendance

Min. Credit Score

Does not disclose

Check Rates

on Credible’s website

View Details

Overview

pros

Rate discount of one-quarter of a percentage point for using autopay
Does not charge origination or application fees
May qualify for multiyear approval
Grace periods between 9 and 36 months for graduate, MBA, law, dental, and medical school loans and 36 months

cons

Parents borrowers are required to pay at least the interest while the student is in school
Cosigners not eligible for release until at least half the repayment term of the loan is completed

Interest rates

Fixed or variable

Minimum credit score

Does not disclose

Minimum income

Does not disclose

Loan terms

5, 8, 10, or 15 years for most borrowers (law, dental, medical, and other health profession students have up to 20 years)

Loan amounts

$1,000 minimum up to your school’s annual cost of attendance; lifetime limits depend on your degree and credit profile

Cosigner release

Available after more than half of the scheduled repayment period has elapsed and other requirements are met

Eligibility

Read full review

4.44.4

Credible rating

Fixed (APR)

4.24% - 14.02%

Loan Amounts

$1,000 to $99,999 annually $180,000 aggregate limit)

Min. Credit Score

Does not disclose

Check Rates

on Credible’s website

View Details

Overview

pros

Multiyear approval lets you secure funding for future school years
You can reduce your rate by 0.5 percentage points with autopay and loyalty discounts
International students can apply with a qualified cosigner
Offers parent student loans

cons

Fewer repayment terms to choose from than some other lenders
Long wait time for cosigner release
Parents can’t defer payments while student is in school

Interest rates

Fixed or variable

Minimum credit score

Does not disclose

Minimum income

Does not disclose

Loan terms

7, 10, or 15 years

Loan amounts

$1,000 to $99,999 per year (lifetime limit of $180,000)

Cosigner release

36 months

Eligibility

Read full review

4.64.6

Credible rating

Fixed (APR)

4.80% - 8.54%

Loan Amounts

$1,001 up to 100% of school certified cost of attendance

Min. Credit Score

670

Check Rates

on Credible’s website

View Details

Overview

pros

Low minimum borrowing limits
Autopay discount of 0.25 percentage points
Short cosigner release requirements
Transparent qualification requirements

cons

Loans are available only to Indiana residents
No prequalification option to view your rates
No loan options for international students

Interest rates

Fixed or variable

Minimum credit score

670

Minimum income

Does not disclose

Loan terms

5, 10, or 15 years

Loan amounts

$1,001 minimum, up to the school certified cost of attendance

Cosigner release

12 months

Eligibility

Read full review

3.13.1

Credible rating

Fixed (APR)

5.75% - 8.95%

Loan Amounts

$1,500 up to school’s certified cost of attendance less aid

Min. Credit Score

670

Check Rates

on Credible’s website

View Details

Overview

Massachusetts Educational Financing Authority (MEFA) offers student loans to borrowers with good credit. However, you won't be able to see your potential rate before applying.

pros

Doesn’t charge any fees
Low maximum rate compared with some lenders
Can borrow up to the school-certified cost of attendance

cons

No discounts for borrowers
Limited repayment terms
No prequalification available

Interest rates

Fixed

Minimum credit score

670

Minimum income

Does not disclose

Loan terms

10 or 15 years

Loan amounts

$1,500 minimum up to school-certified cost of attendance

Cosigner release

48 months

Eligibility

Read full review

4.34.3

Credible rating

Fixed (APR)

3.49% - 15.49%

Loan Amounts

$1,000 up to 100% of school-certified cost of attendance

Min. Credit Score

Does not disclose

Check Rates

on Credible’s website

View Details

Overview

pros

Can borrow up to school-certified cost of attendance
No prepayment or origination fees
Loans available to noncitizens with an eligible cosigner
Cosigner release after 12 on-time payments

cons

No parent loan options
No option to check your rates through prequalification
Loan terms not disclosed until after you apply

Interest rates

Fixed or variable

Minimum credit score

Does not disclose

Minimum income

Does not disclose

Loan terms

10 to 15 years for the Smart Option Student Loan; 15 years for law school, MBA, and graduate school loans; 20 years for medical school loans

Loan amounts

$1,000 up to school-certified cost of attendance. Student must be listed as the borrower, and a parent may cosign.

Cosigner release

After you graduate, make 12 one-time principal and interest payments, and meet certain credit requirements

Eligibility

Read full review

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