It really depends on the school. Schools with larger endowments can provide students with more scholarship and grant money that they will not have to repay. Schools can also choose to offer a student more money than determined by FAFSA. In your case, they may choose to offer a little more than half your child's tuition in their package. The criteria for such aid is usually high school GPA and financial need. Federal student loans and work-study can be offered in combination with the grant/scholarship money, but in most cases, some sort of loans are entailed in this package. This is why it is so important to apply for scholarships. Federally-reported outside scholarships decrease the federal student loans in a financial aid package first.