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Avoiding Scholarship Displacement

Students and parents, this post is to help you keep every local scholarship dollar awarded. The over-arching message is: communicate with your school’s finance office and understand their offer to you. Make sure all additional scholarships are added to your school’s financial aid package, and follow through when bills arrive.

Scholarship displacement is when a college or university reduces a student’s financial assistance by the amount of a new, “private” scholarship, rather than adding the new scholarship to the student’s aid package.

If you receive one or more “private” scholarships (that is, a scholarship from anyone other than your college), we urge you to make sure that your awards are added to the aid that your college promises you. None of your local scholarships—including any Community Foundation scholarships—should be replacing or reducing the grants or scholarships you were offered by your college. 

Here are our tips on how to avoid scholarship displacement:

  1. Read your financial aid letters. Once you’ve been accepted by a college or university, if you apply for financial aid, you should receive a financial aid offer letter from each school. Your aid package may include a mix of loans, work study, grants (including a Pell Grant), and other scholarships. Keep these financial aid letters, read them, and understand them.
  1. Choose your college according to your aid package, and how they would handle any local scholarships you receive. Once you have picked your top two or three schools, talk to them about the aid they have offered you. Call the financial aid offices and ask them how they’d apply any local scholarships you receive to the financial aid package that they have offered you.  Make sure you understand every single part of your aid package:
    • What’s a loan, and what’s not a loan.
      • You want your scholarships to remove the loans (and work study) off your package, or “unmet need”
    • What’s guaranteed to renew, and what’s not guaranteed.
        • What are the renewal conditions (e.g., GPA, particular major, enrollment status)?
        •  Are they guaranteed across all four years of college?

Take notes during your call. Get that person’s name and number. You may want to base your final college selection not only on the aid they have offered you, but on how they will treat any local scholarships you receive.

  1. If you receive a local scholarship, make sure it is ADDED to your school’s financial aid. Once you have selected your school and receive your first bill/statement, make sure that it shows all the local scholarships you were awarded. Then, make sure that your local scholarships are used to reduce your loans, work study, or any unmet need. Compare your bill to your original financial aid offer letter, and make sure and make sure your scholarship was applied against your loans or work study or “unmet need.” Check that none of the scholarships or grants from your college were reduced due to local scholarships. Call them back if you have doubts about this or if they if they do reduce your scholarships or grants, and politely ask them to fix it. For example, they can spread out your local scholarships over several semesters or years to ensure that you benefit from every dollar you earn.

With a little extra care at the front end, you can ensure all of your hard-earned scholarship awards actually give you the full benefits you deserve.

College Senior Christian Eberhard: “Apply Now for More Security, and for Future Schooling and Career Options”

Christian Eberhard (FFHS Class of 2017) will graduate from American University this spring with a bachelor’s degree in Physics. He has been helped with a renewable scholarship, the Sawyer Scholarship, which provided $5,000 per year for each of his four years; a total of $20,000. Christian also received a $1,000 Outer Banks Association of Realtors scholarship for his freshman year. In addition to his Applied Physics studies, Christian runs workshops for students on the use of 3D printers, laser cutters, and other technical machines. His love for the arts continues, and he’s making short films and doing comedy sketches in his free time.

“Applying and receiving a multi-year scholarship has been a tremendous help in my academic career. It has allowed me to venture out of North Carolina in pursuit of higher education… out of state schooling has given rise to incredible experiences and relationships, domestic and international, that I might not have had before. Also, because of this scholarship, I have been able to take out significantly fewer loans, resulting in less hesitation about future schooling/career options and more security.”

The Sawyer Scholarship provides needs-based scholarships to Dare County, Currituck County, and Ocracoke graduates. This scholarship is renewable for up to four years, so long as the student maintains full-time enrollment and a 2.7 GPA. The Sawyer Scholarship is just one of 55 scholarship funds at Outer Banks Community Foundation; this spring, one application will allow students to apply for as many scholarships as they wish.

High school students, our scholarship application process is open through March 20. Here is the link:

Parents, Outer Banks Community Foundation has awarded more than $2 million in nearly 2,000 scholarships to deserving students since 1983. Scholarship funds started generations ago are still making gifts today, and will continue supporting local students, far, far into the future. Scholarship funds can be named in your honor, in the honor of a loved one, or for a cause or career you care about. We invite you to make your mark, by making a lasting gift, such as new scholarship fund, donor-advised fund, or other fund. New funds can be activated now, or in the future by bequest. Call us if you would like more information.