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Want to know a secret? Most students are eligible for some type of financial aid – even if they come from middle to upper-class families or are returning to college later in life. The biggest single requirement for financial aid eligibility is merely part-time enrollment in an accredited degree program. Another common requirement is U.S. citizenship or permanent residency. After that, eligibility for financial aid is generally determined by the individual program requirements.
Grants are one type of financial aid. They may be awarded by federal or local governments, or by the educational institution. Grants typically do not have to be repaid. One of the most common grants available to students is the federal Pell Grant. To apply for a Pell Grant, you must submit a FAFSA (Free Application for Federal Student Aid). Pell Grants are awarded to students based on their demonstrated financial need. Students are ineligible for Pell Grants if they are in default on any federal education loans.
Scholarships are another type of financial aid. Your eligibility to apply for a scholarship will depend on the individual scholarship’s requirements. Some scholarships are only available to women, minority groups or athletes for example. While some scholarship awards may be made based on demonstrated financial need, others are given for outstanding achievement or community service.
Federal Perkins Loans are another type of federal financial aid. Unlike a Pell Grant, a Perkins Loan must be repaid. These loans offer low interest rates and a repayment period of ten years. Federal Perkins Loans are typically awarded to students with a high level of demonstrated financial need. Students are ineligible for Perkins Loans if they owe a refund on a grant or are in default on another federal education loan. Students must also maintain registration compliance with the Selective Service and make satisfactory academic progress each semester.
Subsidized and Unsubsidized Stafford Loans are another type of federal financial aid many students may qualify for. As with the other federal financial aid programs, students will lose eligibility if they are in default on other federal education loans or owe a refund on a grant. Subsidized Stafford Loans are awarded based on financial need. The government pays the interest on your loan while you are enrolled in school. Unsubsidized Stafford Loans are not based on financial need. Interest accrues while you are in school, but you can defer payment until graduation.
PLUS Loans are available for parents of qualifying students and to graduate and professional students who do not qualify for need-based financial aid.
All federal financial aid eligibility is determined through completion of the FAFSA. Because gathering the required documentation and submitting the form can take time, it is recommended that you begin the process as soon as possible to ensure receiving the greatest financial aid award you may be eligible for.
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