Institutional aid is offered to students by the schools they plan to attend. Colleges may offer their own loans, but more often institutional aid is given in the form of grants and scholarships to students who either demonstrate financial need or qualify academically. This money does not need to be repaid. Students who receive these grants and scholarships are usually notified of their awards by their colleges in their financial aid letter. Students may be asked to send thank-you notes to their sponsors, if they are still living, as a courtesy.


What is institutional aid?

Institutional aid is financial aid offered by the school you plan to attend and is only available to incoming and current students. This type of aid may be need-based or merit-based. Some schools offer more institutional aid opportunities than others, depending on the size of the pool from which they can draw money. Schools may include your institutional aid offer in your financial aid letter, which should arrive with or around the same time as your offer of acceptance. If you wish to learn more about institutional aid opportunities, contact the financial aid office at your prospective schools.

While some institutional aid may come directly from your school, other grants and scholarships are endowed by individuals and administered by your college. These individuals are frequently alumni or have other connections to the institution and want to make college accessible to future students. For named grants and scholarships that have living sponsors, you may be asked to write a thank-you note or a letter explaining how the funds made your education possible.

What is the difference between a need-blind and a need-aware school?

There are two types of colleges when it comes to admissions decisions and their relation to financial need: need-blind and need-aware. Need-blind schools do not factor in a student’s ability to pay for tuition when making the decision on whether to admit the student. Schools ideally would meet all financial need when creating a financial aid package (through a combination of federal aid and institutional aid), but some need-blind schools only partially meet financial need, and others only meet the financial need of U.S. applicants.

A need-aware school considers a student’s financial need when making admissions decisions. Typically schools admit a large percentage of incoming freshmen on a need-blind basis, and then the remaining students are considered on a need-aware basis. Neither tactic is necessarily better or worse than the other, but when applying for college, you should be aware of each school’s admissions policy. Consider the following:

  • Need-blind schools will not consider your financial need at all. This means that you may end up with a smaller financial aid package than would make attending a certain school feasible.
  • If you are a marginal student, meaning that you would be accepted toward the end of the applicant pool, and you are applying to a need-aware institution, you may be rejected because of your need for a large financial aid package. The need-aware policy can favor wealthy marginal students over low-income marginal students.
  • Some schools have a “no loans” policy for low-income students with high levels of financial need. If admitted to one of these schools, you will receive a financial aid package in which grants and scholarships take the place of loans. Other schools have a policy that caps the amount of loans that low-income students can take out, leading to less debt upon graduation.

How do I apply for institutional aid?

  • Fill out the FAFSA. It is free to file, and you need to do this to receive federal financial aid. You can request that your FAFSA results be sent to certain schools who will use your information to determine your total financial aid package. The FAFSA becomes available on October 1 each year. Learn more here.
  • Find out if you need to submit the CSS Profile. This is a College Board application for nonfederal financial aid. Over 300 institutions require students to submit both the FAFSA and the CSS Profile before they will calculate financial aid awards.
    • Submitting the CSS Profile is not free, but there are fee waivers for low-income students.
    • The CSS Profile requires roughly the same information as the FAFSA, plus payment.
    • The initial payment allows you to submit your CSS Profile results to one school. You must pay additional fees if you want multiple schools to receive your report.
    • The CSS Profile for the next school year becomes available online on October 1 of the current year.
    • It usually takes between 45 minutes and two hours to complete.
    • Click here to access the College Board’s CSS Profile website.
  • Talk to the financial aid office. You should inquire with your school’s financial aid office to learn whether you must fill out supplementary forms besides the FAFSA and/or the CSS Profile. Institutional aid opportunities may have specialized requirements, such as writing an essay or undergoing an interview. Some may only be open to transfer students or upperclassmen.
  • Know deadlines and requirements. The financial aid deadlines put out by a school may not be the same as the deadline to file the FAFSA or apply for admission. Be sure you pay attention to deadlines so that you can be eligible for the most aid possible.

What do I do after I fill out my application?

After you fill out and submit your applications to your prospective schools, you begin the waiting game. Often students are evaluated for both merit- and need-based aid at the same time. If you are accepted to a certain school, you may learn about your financial aid package with your acceptance letter. Not only do you get to open mail that says you’ve gotten into a college or university, but you may also be immediately notified that you’ve received a scholarship or a grant. Getting mail has never been more exciting!

Page last updated: 08/2017