What is Financial Aid?The word Financial Aid may confuse many individuals and consequence in many questions including: What is financial aid? How I would apply for it? Do I have to return it to? Is there any interest or surcharges included in it?
The Answer is:
Financial aid is merely a monetary assistance or help offered to students who are unable to meet their educational expenses. The aid is normally provided to the individuals by government agencies, individual schools, colleges, universities and other funding sources. There are several types of financial aid programs available even for online education courses.
These types of online educational programs include:
1. GrantsGrant is one type of financial aid. A grant can be defined as money given by the government to students in form of a gift. Qualifying students receive grants and these are not re-payable. However, the only condition that is imposed on a student is that they must maintain a minimum GPA (usually between 2.0 and 3.0 GPA) in order to qualify. The amount of grants depends on the severity of a student’s financial need, the greater the needs the more amounts a grant would accommodate. Students can apply for grants through their prospective colleges or at fafsa.ed.gov.
2. LoansAid for online education can also be borrowed through loans. All loans are re-payable with or without interest depending upon the type of qualifying loan. Students can apply for loans at fafsa.ed.gov, through their college financial aid office, or at their local bank. There are two types of loans that a student may qualify for in the form of financial aid, one is government loan and the other is private loan.
a. Government Loans – Government loans are also called a subsidized loan and are granted to students depending on their needs. A government loan only requires to payback the principal amount of the loan, while the interest is paid by the government on student`s behalf. The limit of the loan granted is set by the school, the students is enrolling in. In most cases, the loan is enough to cover tuition, books, traveling and other expenses. *Only U.S citizens can apply for government loans.
b. Private Loans – If the student applying for loan is not a citizen of United States then he can apply for private loans. In addition, students who get enrolled in non-authorized colleges are not eligible to receive any financial aid from governmental agencies. But all these students can apply for private loans from individual banks, if needed. To qualify for bank loans, students must establish sufficient credit, or co-sign with someone who has good credit. These loans generally consist of higher interest rates and fewer negotiable terms.
3. ScholarshipsScholarships is another way of financial aid that the student can take benefit of. A scholarship is merely an award based on good academic performance, talent, or other factors. The eligibility for a scholarship and amount of money is defined by the particular institute. The amount of the scholarship is not re-payable. Students can learn about individual scholarships from their schools' counseling office, website, or from online scholarship databases, such as fastweb.com, petersons.com, and scholarships.com.
a. Private Scholarships – In addition to the above mentioned scholarship programs, there are thousand of private organizations that offer scholarships to students. The eligibility for qualification may vary with the organizations. Some organizations offer scholarships to the winners of contests they support, while others support individuals who fit particular standards set by the organization.