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4 Important Reasons to Avoid Early Decision If You Need Financial Aid

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Content was accurate at the time of publication.

Although applying early decision (ED) lets you learn about your admissions decision early, it comes with a catch: If you’re accepted, you must attend the school. This binding agreement presents problems for students who need financial aid.

If you’re looking to compare financial aid packages from multiple colleges, this early admission approach might not be for you. Consider these drawbacks before deciding which admissions deadline is best for you.

1. You can’t compare financial aid packages when you apply early decision

When you choose ED, you apply to just one college for early decision in the fall. You agree to attend that school if you get in, plus you typically receive your admissions decision in December. Instead of stressing out about college decisions in the spring, you could already know you got into your dream school.

However, you won’t get the chance to compare financial aid packages with this approach.

“The most important drawback — and this is especially important for students who really are depending on financial aid to afford schools — is that they don’t have the ability to compare offers when they apply early decision,” said college admissions consultant Anna Ren.

You’ll have just one offer, and you’ll have to take it or leave it. If the financial aid package falls short, you’ll need to either take out student loans or break your binding agreement and choose not to attend that school. Fortunately, students can usually turn down an ED offer if the financial aid is insufficient.

“If the net cost of the college is completely unaffordable, you can ask the admissions committee to release you,” said Shirag Shemmassian, founder of Shemmassian Academic Consulting. “Colleges are typically gracious about this.”

But once you turn down admission, your offer disappears. You’ll never get to see how the financial aid from your dream school compares with that from the other colleges on your list.

2. You might not get merit-based scholarships

If you have your heart set on a particular school, applying early decision is one way to show your enthusiasm. With this approach, you’re making an agreement to attend if you get in.

Since colleges want students to accept offers of admission, they might prefer ED applicants for this reason. But colleges don’t have as much incentive to award merit-based scholarships to ED applicants.

“The conventional wisdom is that students who need to get the best financial aid package possible shouldn’t apply early decision,” said Michelle Kretzschmar, founder of DIY College Rankings.

“And this is pretty much true, particularly for merit aid,” she added. “If a college knows you really want to attend, they have no reason to offer any incentive (or discount, because that’s what it really is) to attend.”

Aaron Rose, president of Mavin Learning Resources, echoed this sentiment. “Most colleges use merit aid to attract great students, and it is not necessary for colleges to offer merit aid to students applying ED, as they have already committed to attend if accepted,” Rose said.

When you commit to a school through early decision, you might reduce your chances of getting a merit-based scholarship.

3. You might still be waiting to hear from scholarship organizations

Along with financial aid, you’re probably pursuing scholarships to help lower your college costs. The problem is some scholarship organizations don’t notify students of their awards until the spring of their senior year.

With ED, you must accept a school’s offer well in advance of the typical May 1 decision day. For low-income students, this deadline might be too rushed to make a decision on college.

If you’re relying on scholarship money to pay for college, applying early decision might not be a smart financial move.

4. The applicant pool could be more competitive

Statistics show that ED applicants are accepted at a higher rate than regular decision ones. According to Inside Higher Ed, Harvard accepted 14.9% of its early decision applicants to the class of 2020, as opposed to just 3.4% of its regular decision applicants.

However, the ED pool tends to include highly qualified candidates who can put together solid applications in the fall of senior year.

“The applicant pool is much more competitive,” said Pam Andrews, founder of The Scholarship Shark. “Because the early decision process has the most competitive applicants, it is harder to make an application stand out.”

If you’re rushing to apply, you’re probably better off waiting for a later deadline. Although applying ED can work in your favor, it could also hurt you if you send off a subpar application just to meet an early deadline.

Is applying early decision right for you?

Most experts agree that ED offers higher odds of getting accepted into a school. But applying early decision also prevents you from comparing multiple financial aid packages.

If you’re interested in applying early decision, make sure these four statements are true for you:

  • You’re prepared to apply. ED deadlines typically fall in November. If your essay, recommendation letters or test scores would be stronger in a month or two, you’re probably better off waiting for regular decision.
  • You’re confident about your dream school. Since early decision is binding, you must feel sure you want to attend the college you apply to. If you’re uncertain, apply early action or regular decision instead.
  • You’ve done your financial aid homework. Even if you can’t compare financial aid offers, you can estimate your financial aid package. Use a college’s net price calculator or the federal FAFSA4caster tool to predict your need-based aid. But remember, this tool doesn’t consider any merit-based aid you could get.
  • You’re prepared to apply elsewhere if your financial aid package falls short. Even though early decision is binding, you can turn down the offer if the financial aid is insufficient. Make sure you’re prepared to send off other applications, just in case.

Although it’s easy to get your heart set on a specific college, don’t forget about financial aid. In the end, your dream school shouldn’t just give you an amazing education — it should also help you avoid major student loan debt.

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