Understanding Your Financial Aid Award Letter

Feb 26, 2019

Sometimes, it seems like the excitement surrounding college applications is sapped by the dread of financial aid. Not only do letters vary in language and structure, but they also determine one’s eligibility to attend school. It’s a daunting process. In order to alleviate the situation, we aim to clarify the process and bring some understanding to financial aid letters.

What Is FAFSA?

FAFSA stands for Free Application for Federal Student Aid. The information extracted from this application is used in conjunction with each school’s financial aid resources. Together, these entities determine each student’s eligibility for need-based financial aid, among other things.  

Understanding the Financial Aid Award Letter

Do not be discouraged. Understanding your financial aid award letter is not as scary as you may think. Letters include vital information about the cost of each school’s tuition, as well as the aid package you can expect to receive in your first year of attendance. We can break that down further into direct costs and Cost of Attendance (COA).

  • Direct costs include things like tuition, meal plans, and room and board. Charges like this are billed directly to students or their families.
  • Indirect costs include personal care items, transportation, different fees such as technology or loan.
  • COA refers to the entire cost of attendance.

Scholarships and grants, which can be found in this letter, are awards that are given out by state and federal governments. These awards are gifts, and therefore do not have to be paid back like a loan. Scholarships and grants are generally awarded for merit or are based on income.

To determine your Net Cost, or the amount that you owe the school after gifts, subtract the total number combined from scholarships and grants from the direct costs. This is what you will owe the school. It is entirely possible to apply for additional scholarships outside of the ones listed on a financial aid letter. If awarded, you can subtract these amounts from the direct costs as well.

Student Loans

They sound scary and super adult, but they don’t have to be. It’s best to know up front what a loan is, where you get one, and what is expected of you once you have one (or many).

A student/parent takes out a loan in order to pay the remaining cost of attendance (after scholarships and grants). The federal government offers loans at a much lower interest rate than private lenders. The exact amount the federal government allows to each person and school is stated in the letter. This is the amount of money a student can request for a loan. Financial aid letters cover three types of loans:

  • Subsidized loan — this type of loan interest is paid on the students behalf while they are in school. 
  • Unsubsidized loan — this type of loan does accrue interest.
  • Parent PLUS — a loan for parents that is also regulated by the federal government. Interest rates are higher for these loans, and parents are ultimately the ones who are legally bound to the loan.

If this is not enough to cover all the expenses, you may have to take out a private loan. Interest rates are higher, and they almost always involve a cosigner, who must demonstrate a near pristine credit history.

Work-Study Programs

WPU has a robust work-study programs that allow students to work on campus, while they are in school. If a student is awarded work-study program they are required to find a job to receive the funds.

Read Carefully

Not all letters are created equally. The information is all there, but they are not always structured the same. This can make comparisons difficult. Set up a table that lists the direct costs and COA for each school. Under each of those numbers, write the gifts and aids that bring down the price. Once you have your net price, and you have checked your loan amount, you will be able to see more clearly which schools are more expensive.

Pay Close Attention to Deadlines

Be mindful that letters come with deadlines for responses. You can say “no” to parts of the letter. To clarify, you might notice that you have qualified for federal work study, but you know this is impossible with your schedule. You can say “no” to this part of the letter. You might also see that your loan amount is more than you need to borrow. You can adjust this by contacting financial aid at your school and correcting the amount.

What Is a Financial Aid Gap?

The financial aid gap occurs when awards and financial aid do not match your needs. Many middle to lower class students fall into this category, where they are left with an amount that cannot be paid. Of course, this is not true for all institutions as some do pay 100% of financial aid to those who truly need it.

To learn more about financial aid, you can check out the FAFSA website.

It’s important to start researching and applying for outside scholarships early and often. There are various outside scholarship search engines students can utilize.  You can also check with your local government agencies, businesses, churches, and parents employers’ for scholarship opportunities that are available.

Have a question for us? Browse the WPU directory to find the department or person you wish to contact, or reach out to our financial aid team for all information. Learn more about WPU costs, scholarships, and financial aid here.  

Give Courageously to Peace

Thanks to the generosity of William Peace University supporters, current and future WPU students have access to the resources needed to learn through immersive experiences, build upon their courage and develop the confidence needed to turn passion into purpose.
Roses float in the campus fountain after an alumni event.
a student uses a laptop on a green bench at William Peace University

Give Now

Support future Pacer success. 


Become a Corporate Partner

Find out how your organization can collaborate with Peace.


Whether you’re hoping to attend WPU or hosting an event, you’re welcome to visit WPU! 

Wedding at WPU
Phantom in downtown Raleigh

Conferences and Events

Host your conference, event, or wedding at WPU.

Location and Directions

Get directions, our address, a campus map, and hotel discount information.


Learn about WPU and all it has to offer so you can guide your students to the best fit for their next step. 

Admissions Info

Meet and connect with our Admissions team.

Schedule a Visit

Learn about our processes and schedule a visit.


Our success as an institution has always been rooted in the strength of our community. As an integral part of that community, we invite alumni to stay informed and connected. 

Alumni outside at WPU
Roses float in the campus fountain after an alumni event.
Building at WPU

Get Involved

Stay connected to Peace.


Contribute to the success of future Pacers.

General Info

Read about alumni benefits.


Families are an integral part of a student’s path to WPU. Find answers to your questions here. 

Two WPU students work together on a project during class

Student Success: Why Choose WPU?

Learn about the value of an education at WPU.

Billing and Due Dates

Questions about your student’s enrollment or billing? Start here.

Current Students

Already a Pacer? Here’s your quick path to information, links, and other useful stuff.

Group of students talking
Students high-fiving each other

Current Students

Missing something? Can’t find a link? Start here.

Current Parents and Families

Is your student a Pacer? Here’s where to get information and contacts.

Future Students

Welcome to William Peace University! We offer programs for both traditional undergraduate students and online/hybrid classes through our School of Professional Studies. Find your path to WPU here.

Three WPU students walk through a brick archway on campus.
Three students discuss their work during class.
Older gentleman at a computer

First Time in College

Your WPU education will help you build practical skills for your future.

Transfer Students

Transfer up to 90 credit hours from any institution. 

Working Professionals

Enhance your existing career.

A WPU student works on a video game in the new esports and gaming lab on campus.
Woman in army green typing at computer
Two female international students


If you previously attended WPU and are ready to return, start here. 


Learn more about how to apply the GI bill.

International Students

Find out how to attend WPU.


WPU has a long history as one of the city’s oldest universities. Find out more about our institution in the heart of downtown Raleigh. 

2023 Student Showcase
Staff Pumpkin Painting


Through 160 years, William Peace University has evolved to meet the changing needs of the students we serve.


William Peace University is a small, private institution located in downtown Raleigh, NC.

Work at WPU

Join our team and see why William Peace University was voted one of the Triangle’s Best Places to Work!

DEI Staff
Design Rendering of WPU

Contact Us

Contact the University

Diversity, Equity, and Inclusion

Learn about DEI at WPU.

Mission, Vision, and Values

Learn about WPU core tenets. 

Student Life

Whether you want to know more about on-campus events or see our residence halls, get a sense of what life is like as a student at WPU.

WPU Student on bouncy slide
A WPU student sits with his friends while eating at Belk dining hall.
WPU Safety Officer

Clubs, Activities and Events

Discover what’s fun at WPU.

Housing & Dining

When people say that WPU “feels like home,” we think that’s the ultimate compliment.

Safety & Security

The Office of Public Safety is committed to providing a community-friendly approach to enhancing campus safety for students, faculty and staff.

Dining room at Peace
A WPU student sits with his friends while eating at Belk dining hall.
Health and wellness at WPU


Cheer on your Pacers at their next home game.

Student Support Services

Find out how the WPU team supports the whole you.

Health and Wellness

Learn about physical and mental health services available to students.


WPU offers a mix of more than 30 degree programs and additional minors. Our courses are four credit hours each, and every course features immersive learning experiences.

A student in WPU's online School of Professional Studies works on her homework.
2023 Internship Showcase

Immersive Learning

Find out about WPU’s unique approach to learning.

Center for Student Success

Peer tutoring, a first-year success program, and an internship program are just part of why Pacers succeed. 


Start here to find out how to apply, visit, and learn more about WPU.

Before you apply:

Admissions team
students walking on campus
A student reviews scholarship and payment information in the financial aid office.

Connect with an Admission Couneslor

They’ll be your guide through the process.

Visit Campus

Get a feel for campus life.

Understand Costs

Find out about Financial aid and other options to pay for college.