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Negotiation and Professional Judgment


Negotiation refers to the idea that you can haggle with the financial aid office to get a better financial aid package. Very few schools do negotiation, and those that do, do so only according to set policies. Colleges are not car dealerships, where bluff and bluster will get you a better deal. You cannot play one school off another, to get them in a bidding war for a student. Students are effectively commodities, with very little bargaining power. .

On the other hand, colleges do have the authority to make adjustments to a student's financial aid package in cases involving unusual circumstances through a process known as Professional Judgment.

First, make sure you understand how to evaluate financial aid award letters.

Understanding the Process

Regardless of whether you call it negotiation or professional judgment, it is important to understand how the process works in order to maximize the amount of student aid. FinAid has an extensive section devoted to the topic of professional judgment from the perspective of the financial aid administrator. Here are some of the key points:

  • Congress delegated the authority to college financial aid administrators to make adjustments when there are special circumstances.
  • Special circumstances are anything that differentiates the family's finances from those of other families, especially anything beyond the family's control.
  • Special circumstances can also be anything about the family's finances during the prior tax year that is not reflective of the finances in the upcoming award year.
  • Examples of special circumstances include an actual or anticipated job loss or salary reduction, death of a wage earner, high unreimbursed medical bills, unusually high child care costs, private elementary and secondary school tuition, parents themselves enrolled in college, unusual capital gains and other one-time events.
  • The decision of the financial aid administrator is final. There is no appeal to the college president nor to the US Department of Education.
  • Professional judgment is driven by documentation. It is best to provide the financial aid administrator with documentation of the unusual circumstances from a neutral third party. The US Department of Education audits the universities very frequently, and if a professional judgment case is not supported with documentation and clear reasoning about the relationship between the unusual circumstances and ability to pay, the school will have to repay the aid to the federal government.
  • Financial aid administrators are not allowed to change the family's expected family contribution directly. Instead, they can change the inputs to the formula.
  • It pays to be polite. Trying to argue with the financial aid administrator or to intimidate the financial aid administrator will backfire.
  • Most people who become financial aid administrators get involved because they like helping people. They are not the enemy.
  • Don't gripe about how hard it is to make ends meet on your salary. Most financial aid administrators earn less than the families they serve. You will get a better response by acting professionally.
  • Sympathy only comes into play when the financial aid administrator is trying to decide whether to allow an adjustment for the special circumstances, like something over which you had no control.
  • Most financial aid administrators will not make an adjustment when they feel that the family is trying to game the system.
  • The extenuating circumstances and their impact on your finances is the driving factor, not how much you ask for. In fact, it is a bad idea to ask for a specific amount.
  • The family has the primary responsibility for paying for college. The government and the college only step in when the family's ability to pay falls short. The focus of need analysis is on ability to pay, not willingness to pay. Even with professional judgment, the amount the government expects the family to contribute will be painful for most families.

How to Ask for Professional Judgment

Professional judgment is initiated by the family writing a letter to the financial aid administrator at the school asking for a "Professional Judgment Review". At some schools this is called a "Special Circumstances Review". The letter should summarize the unusual circumstances and include copies of the documentation. The letter should be short and stick to the facts, instead of burying them in a long-winded plea for help. The financial aid administrator may ask for additional information and additional documentation.

Do not include the letter with your original FAFSA application, as it will be discarded. The letter should be sent separately to the student's college.

Some people who promote the idea that you can negotiate with colleges recommend that the student and not the parents contact the school. The reasoning is that the student is the one seeking help, not the parents, and it is harder to say no to a student who desperately wants to be able to attend the college. Unfortunately, although this probably doesn't hurt, it doesn't help either. The negotiation process with colleges is driven by documentation of special circumstances, not emotional appeals.

Schools that Negotiate

An unpublished survey of 1,492 colleges conducted by the National Association of Student Financial Aid Administrators and the College Board found that only 1% of public colleges and 2% of private colleges frequently or always adjust financial aid packages to reflect other college's offers. The survey also found that 5% of public colleges and 10% of private colleges adjusted financial aid packages in response to the family's stated inability to pay.

This indicates that although very few schools "negotiate", there are nevertheless a handful that do. Most of those that do use a rigid policy to determine when they will match other school's financial aid offers. Usually the schools will only match offers from a limited number of schools that the college considers to be its peers, i.e. similar quality schools for which the college competes for students.

If you want to try negotiating with a school, present a better offer from a competing college and indicate that you will matriculate at the school if they will match the other school's offer. If the school is one of the few that matches other institution's offers, they will ask for a copy of the other school's award letter. They will compare it with their own financial aid package, and also the costs and student budget at each school.

The schools that will match offers from competing schools are open about the practice and encourage the students to submit competing offers. For example, Carnegie Mellon University is famous for its willingness to reconsider its original offer. This doesn't mean you'll necessarily get a better offer after the second review, just that they are willing (some say eager) to take a second look in response to new information, including better offers from their competition.


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