Free Grants for College: Applying Online

The available US Budget pertaining to grants for college has already been announced at a figure of $86.4 billion USD.

It should be understood that these grants – once approved and paid – are not loans and are not required to be paid back; neither does the applicant have to pay fees in advance for the application.

Having a poor credit rating or even someone who has suffered from bankruptcy may apply without penalty and in addition, it’s possible to receive more than one grant at the same time.

With the numbers of people without work hovering at high levels, the government wants to use this opportunity for those approaching entering the workforce or those looking to rejoin the workforce to increase their skill set and provide more competitive skills to boost the national economy.

The target is in particular to keep students in college for longer and guide them to leave college with a higher set of qualifications; extensive research has shown that accurate targeting of grants for college has resulted in significantly improved grades.

Preparing for Application

It is imperative to do research before preparing the application as there are a number of options that will be available for the applicant; the main categories where grants for college are available are Pell grants, refunds for low income students, tax credits, scholarships, Federal student loans and tuition reimbursement.

The applicant should also look to receive information from the college about the financial aid options available, tuition costs, career guidance and course schedules. This is important if the student wishes to combine study with work to plan an estimated timeline to graduation and achieve the college accreditation.

Typically, the US government agency will get the applicant to complete their profile, identify the area of study interest and set up a dialogue directly between the applicant and the colleges of interest.

Pell Grants for College

These grants are named after US Senator Claiborne Pell who introduced such grants for college in 1965.

Pell grants do not require repayment and are awarded on a financial need formula using a form called ‘Free Application for Federal Student Aid’. Pell grants are mainly targeted towards students from low income households.

In 2011, the maximum annual Pell grants available are capped at $5,800 and the amount available is linked to the general Consumer Price Index. As college and university fees have increased beyond the general rate of inflation, Pell grants cover an average of approximately 30% of these fees in recent years compared to 60% in 1990.

An applicant for a Pell grant must naturally demonstrate a financial need. In 2006, students whose family income was less than $20,000 per year accounted for 57% of the successful applicants of whom 35% attended public two-year colleges and 42% attended four-year colleges.

Only one Pell grant can be received by a student at one time. The Pell grants are paid to the students directly by the colleges they are attending and the payment is divided into semester, trimester or quarter based on the college terms. The payment is usually made by check and it is the college’s responsibility to receive the refunds from the government. While college grants in general have been cut in recent years, the budget for the Pell Grants has been protected.

• A Federal Pell Grant, unlike a loan, does not have to be repaid.
• The maximum Pell grant for the 2011-12 award year (July 1, 2011, to June 30, 2012) is $5,550.
• The amount depends on your financial need, costs to attend school, status as a full-time or part-time student, and plans to attend school for a full academic year or less.
• Learn more about Pell grants.
• To apply, complete the FAFSA.

Refunds for Low Income Students

A number of organizations have moved forward to assist cash strapped students in order to allow them to continue with their studies; the objective is to assist the student to gain access to their Earned Income Tax credit, these funds are available but navigating the procedure to secure them is complex.

In selecting an organization to assist with this, look for non-profit organizations which have good links with the college of your choice, oftentimes students are basically unaware that they are qualified for this category of grants for college tuition.

Tax Credits

As defined under the American Recovery and Reinvestment Act activated in 2009, this category gives more students and parents of the students the possibility to qualify as a form of Federal grants for college and is to be used to pay for college expenses with a maximum credit of $2,500 USD per student.

Tax credits can be claimed when evidence of payment for qualifying material is presented and full credit is available to individuals whose modified annual income is $80,000 or less or $160,000 modified annual income for married couples filing a joint return.

Scholarships

As one of the longest running college grants, mechanisms are important to check for the eligibility of the student applicant. Most of the times, scholarships are given by virtue of meritocracy. However, there are scholarships which focus as minority grants for college and reach out to the various minority groups which can include ethnic background, where the applicant lives or applicants with certain disabilities.

The first step is to check with the school what scholarships are available in the neighborhood; also this information can be found from the local chamber of Commerce as well as local minority organizations.

Time should be taken to understand how to present an application and naturally the selection criteria and number of free places available at the time of the application. There can be additional requirements of the applicant such as to complete community service and the required internment criteria.

Scholarships are normally highly coveted and therefore competition is high.

Money for College: Student Loans

If the student does not qualify for a college grant or the amount cannot cover the annual expenses, the alternative is to apply for a student loan. There are basically two options; on one hand the parents of the student make the application and on the other hand, the student files the application on his or her own behalf.

The key differences are that normally a student loan request from a parent or the parents will qualify for a larger loan, however the loan repayments will begin immediately. If the student applies for the loan, the repayment schedule will only begin after they have completed their studies.

It makes sense to research the options closely as there are numerous organizations that specifically specialize in student loans and the government itself offers loan facilities, particular attention should be paid to interest rates, insurance cover and if the repayment schedule is within the applicant’s budget.