How to Pay for the University of Michigan: Aid and Student Loan Options

 September 24, 2020
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The University of Michigan is a top-ranked research institution with a competitive acceptance rate. If you’re lucky enough to be admitted to UMich, you may be wondering how to finance your education there. Luckily, there are plenty of options for University of Michigan student loans and other financial aid, such as scholarships and grants.

While the University of Michigan’s financial aid office will have detailed information to answer any questions you have, let’s take an overview of all your choices for student aid, specifically looking at…

What the University of Michigan costs

Before looking at your possible funding sources for UMich, let’s find out exactly how much money you need in the first place.

The chart below details the cost of attendance for in-state and out-of-state students for 2021-2021 at University of Michigan’s College of Literature, Science and the Arts. As noted on UMich’s website, tuition rates may vary depending on your specific college, residence classification, class standing, number of credit hours registered and term, so consider the numbers to be an estimate.

Keep in mind that if your family income is less than $65,000 and assets are below $50,000, University of Michigan will pay full undergraduate tuition and fees for up to four years, as long as you are an in-state student and are earning your first bachelor’s degree. That’s a financial aid bonanza, so be sure to take advantage of this if you qualify.

In-state lower division students (freshmen and sophomores) In-state upper-division students (juniors and seniors) Out-of-state lower division students Out-of-state upper division students
Tuition and fees $15,948 $17,948 $52,266 $55,928
Housing and meals $12,034 $12,034 $12,034 $12,034
Books and supplies $1,048 $1,048 $1,048 $1,048
Personal and misc. $2,454 $2,454 $2,454 $2,454
Total budget $31,484 $33,484 $66,698 $70,292

You can also use the university’s calculator to help you estimate your own cost of attendance and potential aid eligibility.

How to pay for the University of Michigan

Now that you have a sense of how much you’ll need to come up with, here’s a list of places to turn for the money. The first step, as with most colleges and universities, involves filling out the Free Application for Federal Student Aid (FAFSA), which will unlock many of the other options listed below.

Here are your funding sources for the University of Michigan, in the order you would (ideally) seek them:

  1. The Free Application for Federal Student Aid (FAFSA)
  2. Grants for University of Michigan students
  3. Scholarships for University of Michigan students
  4. Federal work-study
  5. Federal student loans
  6. Private student loans

The Free Application for Federal Student Aid (FAFSA)

Before you do anything related to paying for college, particularly if you are looking for federal loans and grants, fill out the FAFSA. This form compiles your financial information and sends it to the schools you designate. Each school’s financial aid office will then use that information to determine the aid for which you qualify.

Grants for University of Michigan students

Depending on certain factors, you could qualify for federal or University of Michigan-based grants. Like scholarships, grants are money you don’t need to repay.

The University of Michigan notes that for students with annual family income of $65,000 to $95,000 have an average of 91% of their tuition covered by scholarships and grants, meaning their average tuition is only $1,512 a year. For students with family incomes of $95,000 to $125,000 per year, an average of 55% of tuition is covered by scholarships and grants. This goes to 33% for students with family incomes of $125,000 to $150,000 and 27% for students with family incomes of $150,000 to $180,000.

Below you’ll find a list of grants that may be available to you as a University of Michigan student.

Federal grants

  • Federal Pell Grants: Undergrads with demonstrated financial need may be eligible for Pell Grants. The award amount can be as much as $6,345.
  • Federal Supplemental Educational Opportunity Grants (FSEOG): Students can earn up to $4,000 a year based on financial need.
  • TEACH Grant: The TEACH grant may provide up to $4,000 per year for full-time students working toward a teaching career and who plan to teach high-need subjects in low-income areas, although amounts may vary depending on circumstances including federal sequestration. Students with three-quarter enrollment status can receive up to $3,000, half-time students can receive up to $2,000 per year and students enrolled in less-than-half-time can receive up to $1,000.
  • Iraq and Afghanistan Service Grant: If your parent or guardian died while serving the military in Iraq or Afghanistan after the events of 9/11, you may be able to receive this grant.

University of Michigan need-based grants

  • Go Blue Grant: The grant amount varies based on need and availability of university funds. The grant is renewable, but you must apply and meet eligibility guidelines each year.
  • M-Pact: The grant amount varies based on need and is especially targeted toward the students with the lowest Expected Family Contribution on the FAFSA and Profile.
  • University of Michigan Grant: This award is for undergraduates pursuing their first bachelor’s degree. It’s available to students in the first 10 terms of enrollment, as long as the student is enrolled at least half time.
  • Perkins Replacement Grant: This is for students who would have qualified for the federal Perkins loan that no longer exists. Award amounts vary.
  • Provost’s Award: This grant is also geared toward students with the lowest Expected Family Contribution on the FAFSA and CSS Profile. Award amounts vary.
  • Victors Award: This award is available to students for up to 10 semesters. Students qualify based on their admissions and financial aid applications for their first year of attendance. Award amounts vary.
  • Child Care Subsidy Program: This award is for students with dependent children who are 12 and under or special-needs children who are 19 and younger. The subsidy helps provide money for licensed child care. The maximum award for one child as of the 2020-2021 school year is $3,028 per term, for two children it’s $4,439 and for three or more children it’s $5,852.

State of Michigan non-needs-based grants

  • Children of Veterans Tuition Grant: Eligible students must be the child of a veteran who died or was permanently injured while serving, or was listed as MIA. The grant provides up to $1,400 for part-time, $2,100 for three-quarters time or $2,800 for full-time students, or the amount equal to the student’s eligible tuition in that academic year, whichever is less.
  • Michigan Indian Tuition Waiver: Eligible student must be at least one-quarter North American Indian and member of a federally recognized tribe. Both criteria would have to be certified by the Tribal Enrollment Department. The grant offers full tuition for a year and is renewable depending on state funding.
  • Michigan National Guard State Tuition Assistance Program: Students must be active in the National Guard. Award is up to $6,000 for the academic year.

Scholarships for University of Michigan students

Your application for admission to the University of Michigan also will be your application for a variety of scholarships at the school, including those issued by individual departments. You should also complete the CSS Profile if you want to be considered for need-based scholarships from the school.

University of Michigan scholarships include:

  • Enrollment Scholarships: The four-year Fairfax, Tappan and Presidential scholarships are part of the automatic scholarship program for which you only have to enroll to potentially qualify. You’ll find out if you receive one of these scholarships when you receive your information packet from the financial aid office at UMich.
  • Invitational Scholarships: Invited students will receive a preapproval for the High-Achieving Involved Leader (HAIL) scholarship. This award offers four years of tuition and mandatory fees and is targeted to high-achieving, low-income students from Michigan. The Michigan Alumni Scholarship is another invitational scholarship offered to just-admitted students from select northern Michigan counties that are underrepresented at UMich’s Ann Arbor campus. This is a one-time $2,500 award.
  • Partner Program Scholarships: These include the Detroit Promise Scholarship for four years of tuition and mandatory fees, the Posse STEM scholarship (also four years of tuition and fees) and the Wolverine Pathways Scholarship, which provides four years of tuition and fees for students who complete the Wolverine Pathways program.
  • Stamps Scholarship Program: This is a prestigious merit scholarship award for first-year undergraduates, and it pays the student’s full cost of attendance for four years. This award goes to students who are considered leaders in both their academic and community pursuits.

There are many other departmental and other scholarships offered through the University of Michigan, and quite a few of them do not require an application. You can go here to explore the multiple options available and to view several instructional videos from the University of Michigan, including tips on writing a great scholarship essay, completing scholarship applications and getting letters of recommendation.

Federal work-study

The federal work-study program provides funds for part-time student employment. Federal money set aside though the program pays a portion of wages so employers can afford to hire more students.

You can go here to explore work-study and other job opportunities at the University of Michigan.

Federal student loans

After exhausting grant and scholarship opportunities, you may consider taking out federal student loans. These loans come with a number of perks, including:

  • Income-driven repayment: If you have a low income after graduation, you might qualify for a repayment plan based on your earnings, allowing you to make manageable payments without falling behind.
  • Deferment and forbearance: With federal student loans, you might qualify for deferment and forbearance if you run into economic hardship.
  • Fixed interest rates: Federal loan interest rates are set each year, and remain fixed for the term of the loan.
  • No credit check: For most federal loans, you don’t have to go through a credit check to qualify.
  • Potential for federal loan forgiveness: Programs such as Public Service Loan Forgiveness (PSLF)and forgiveness while on income-driven repayment plans, as well as access to state-level forgiveness programs, can provide a way to discharge some of your federal debt.

Options for federal loans include:

  • Direct subsidized loans: These are need-based loans available to undergrads. The government covers interest charges while you’re in school, during your grace period and during any periods of deferment.
  • Direct unsubsidized loans: Undergraduate and graduate students are eligible for direct unsubsidized loans, regardless of their financial need. You’ll pay interest while loans are deferred, including while you’re still in school.
  • Direct PLUS loans: Graduate students and parents can qualify for PLUS Loans, but unlike with other direct loan programs, you can’t have bad credit. Interest isn’t subsidized on these loans.
  • Direct consolidation loans: These loans allow you to combine all your federal loans into one loan with one servicer.

There are annual and aggregate limits on federal loans, which you can find in our report on this topic.

Private student loans

Students can get private student loans from banks, credit unions and online lenders. Unlike most federal loans, private lenders will usually take your credit and financial profile into account.

There aren’t as many borrower protections or repayment options with private loans as with federal loans, so you’ll probably want to use up your federal loans first. But that said, private lenders may offer some perks of their own. For example, you may be able to defer payments until after you leave school, or put your loans into forbearance during financial hardship. It’s also possible you may be able to get better interest rate terms than with federal loans, particularly if you have stellar credit.

Here is a list of some great private student loan lenders to start your search.

Final thoughts on financing your University of Michigan education

While paying for your education at the University of Michigan may be challenging, careful research can help you find your best aid. Be sure to max out your grants and scholarships first, as you may not have to pay them back. Then you can aim to find the most affordable loans.

You should also know that the scholarships and grants listed above are not even close to your only options. You may qualify for any number of grants or scholarships available to students all over the US. You may even be able to secure a scholarship for demonstrating an unusual talent, such as duck calling.

To turbocharge your search, try some of these 10 scholarship tools that can help you find money for college.

Rebecca Stropoli contributed to this report.

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