University of Virginia

Grants vs. Loans

Financial aid award letters are coming in soon, and it is important that you read them carefully. Aid comes in different forms. The total amount of the aid package is less significant than the mix of grants vs. loans. Packages heavy on grants are what you want.

There is no standard form to the award letters, so they can be difficult to compare from school to school. Be sure to double check the Cost of Attendance (COA) for each school, and look at the individual components to confirm they are accurate for your family (items like personal expenses and transportation for example.) You can find COA information on the school’s website or on

When looking at the award, identify the amount for grants, work-study, and need-based loans. See if non need-based loans are included in the letter. Write down the amount for each category.

Here’s a tip: when you subtract the amount of the grants, work-study and need-based loans from the COA, you should be close to your Expected Family Contribution.

The letters can be confusion, so if you are not clear on what the college is offering, have your son or daughter pick up the phone and call the aid office. Ask them to explain the package, specifically the amount of grants vs. loans. Your student will get a better understanding of how this process works and so will you.

If you have any questions, we’re here to help.