This section of the page attempts to answer the question “What are my chances of getting a grant?” It therefore deals with the current reality of funding for the MEFV. We do not mean, however, to discourage you from applying for a grant. We only intend to be honest about what you can expect.
When considering the issuance of a grant, the MEFV considers the annual cost of the grant. That is, how much money we will have to raise each year to make the necessary payments to keep a grant recipient’s student loans current? To make this concrete, here is an example:
Jane Doe has three student loans with balances and payments as follows:
Her total outstanding loan balance is $38,000 with a monthly payment of $450. To keep these loans current, an annual payment of $5,400 is required. So if we give Miss Doe a grant, it will cost the MEFV $5,400 per year. Assuming Jane perseveres, MEFV will be responsible for that annual cost for the next 12 to 14 years.
For the last grant review period, the MEFV board of directors authorized $33,000 worth of annual cost for grant issuance. When the review board met, there were 22 applicants presenting a total annual grant cost of $61,594. All but three applicants presented an annual grant cost of less than $5,000.
If our fictional Miss Doe had applied in the last period and the review board had given her a grant, they would have had $27,600 left to issue more grants in that period. However, for the equivalent of $5,400, they could have issued grants to the first six applicants with the lowest annual grant costs.
As of the date of this writing (May 2010), the MEFV has 61 active grants outstanding with an annual cost of $120,500 Since the beginning of 2010, we have raised $56,597 for the payment of these grants and the issuance of more. We are very thankful to our donors for this level of support. However, we must be prudent about the allocation of funds to new grants.
At this current level of fundraising, it is unlikely that the board of directors will increase the yearly allotment of funds for the issuance of new grants. (In fact it could decrease, depending on how fundraising goes for the rest of the year.) Because the review board likes to help as many aspirants to religious life as possible, this means that your chances are better if your monthly payments are relatively low.
How low is low enough? We don’t specify that because the review board treats each application individually. There may be (and have been) compelling reasons to issue more expensive grants.
But in general, it’s a good idea to get your monthly payment as low as possible. Consolidation of loans doesn’t help and can make the situation worse. When several loans are consolidated, a lender will not allow designation of an excess payment to a particular loan. A real improvement can be made with aggressive pre-payment of loans. See the answer to “How best to apply loan overpayments?” for more information.