FAFSA

FAFSA: What types of aid are available?

So, you read part 1 and part 2 of the FAFSA Series, but now you’re wondering: what types of financial aid are available? I’ve got you covered! In this post, I’m going to talk about the types of aid available from FAFSA and other sources.
The types of aid available from FAFSA are grants, scholarships, and loans. Some of these come directly from the federal government and some come from the state government. What’s the difference between a grant and a scholarship? Both are free money that does not need to be repaid; the true difference is about where the money comes from.
Regarding the FAFSA, grants come from the government. Grants for other purposes like research or volunteer work can come from both the government and private corporations or organizations.
Scholarships usually come from private corporations, businesses, non-profits, organizations or individuals. Sometimes scholarships come from the government. One example is the HOPE Scholarship. I have this scholarship from the State of Georgia, but the money comes from lottery sales in the state. Many states have similar programs, check to see if yours does!

 

Grants

As I mentioned above, grants are free money that does not need to be paid. Here are the different types of grants that you can get from applying to FAFSA:

  • Federal Pell Grant: This grant is usually only awarded to undergraduate students, but can be given to graduate students on occasion. It’s only available for up to six years of college. It’s only awarded to students who demonstrate financial need. If your parents died in Iraq or Afghanistan after 9/11, you may be eligible for a larger sum of this grant. You can read more about that here.
  • Federal Supplemental Educational Opportunity Grant: This grant is commonly referred to as the FSEOG. It’s awarded to undergraduates with exceptional financial need. I received this grant my freshman year. Then my dad got a slight raise and I lost it. I only got $250 a semester, but it’s possible to get anywhere from $100-$4000 a year. To qualify, you must be receiving the Federal Pell Grant. Not all schools participate. Check with your financial office to see if yours does.
  •  Teacher Education Assistance for Higher Education Grant: Also, called the TEACH Grant. There is an obligation with this grant. It’s given to students who plan to become teachers in a needed area, they must agree to work in a low-income area for a certain amount of time. The maximum amount per year is $4000. If you don’t fulfill your obligation, the government turns this into a loan. You do NOT have to be an undergraduate. For more information on this grant, click here.
  • Iraq and Afghanistan Service Grants: There is very specific criteria for this grant. You might be eligible if you meet all Federal Pell Grant eligibility but don’t qualify because your Expected Family Contribution is too. In addition, your parent or guardian must have been a member of the U.S. armed forceds who died in military service in Iraq or Afghanistan after 9/11. For more information, click here.

The above grants are the only ones offered by the Federal Government. However, many State Governments offer grants through FAFSA. I will cover state aid through FAFSA later in this series.

 

Scholarships

Scholarships are free money that does not need to be repaid. Now, you will not be given any scholarships from the Federal Government through FAFSA. However, some states have scholarships, like the HOPE Scholarship, that you will be eligible for by submitting FAFSA.

Don’t be disappointed yet! There are some scholarships offered by the government. And you do have to apply for FAFSA to be eligible. To apply for these scholarships, you must apply directly to them.

  • Benjamin A. Gilman Scholarship Program: This scholarship is only available to students who are receiving the Federal Pell Grant. It’s for students with financial need who want to study abroad. It’s worth $5000. Find out more here.
  • There’s a very large list here. They’re not all from the government but some are and most require you to be receiving aid from FAFSA.

 

Loans

The type of aid that everyone dreads, but many must use! Loans are money that is borrowed to students or their families to pay for school. They must be repaid and come with interest. Here are the different loans from the Federal Government through FAFSA:

  • Federal Direct Subsidized Loan: No loans are good, so avoid if you can! This loan is the better of the options from the government. It’s only available to students who demonstrate financial need, but the government pays all your interest while you are enrolled at least half-time in school. You start paying around 6 months after graduation. Only for undergraduates.
  • Federal Direct Unsubsidized Loan: Available for undergraduates, graduates and professionals. Interest accumulates while in school, but the same guidelines as the Subsidized loan.
  • Direct PLUS Loan: available to graduate students, professionals or parents of dependent students.
  • Direct Consolidation Loans: allows you to combine all your federal loans into one single loan from a single provider. Much better than having a bunch of different interest rates and payment dates.
  • The Perkins Federal Loan Program: The school is the lender. Available to undergrads and grads who demonstrate exceptional financial need.

 

For more information on federal loans, click here.

 

Sign up for emails on the sidebar so you don’t miss the next segment of the FAFSA Series. Leave a comment and tell me what your questions about FAFSA are and I’ll make sure to include them in the series.

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