Finding financial aid for your college education can be confusing because there are many different types of assistance available. However, you can simplify your search for financial aid with a few easy definitions. A grant is any money provided by another source which you do not have to pay back. A scholarship is money given to you by an outside source for a specific quality or trait you have shown, such as a good grade point average or your membership in a certain group. A loan is money that you must pay back eventually, and often includes interest costs as well as principal.

Grants and scholarships are obviously preferable to loans if you are going to seek financial aid. You do not need to pay these monies back, and you can use them for a variety of educational purposes including tuition, books, and living expenses. However, not all grants or scholarships are available at all schools. If you decide on an online institution, some monies may not be available to help you pay for your education.

What Is The Pell Grant?

The Pell Grant is the “basic” government grant given to students who demonstrate financial need. Currently, the Pell Grant pays up to $5,500 toward tuition for qualified students, although the amount is based on several factors including family size and income.

If you qualify for a Pell Grant, it can help you pay your tuition fees and enable you to get a college education. However, your Pell Grant will not apply at every school. It is important to determine if the school which you wish to attend is eligible to receive Pell Grant funds.

Are Online Schools Eligible for Pell Grant Funds?

The deciding factor in Pell Grant eligibility is accreditation. Pell Grants will only be awarded to students at accredited universities or colleges. Students must also be working toward a bachelor’s degree; Pell Grants are not available for online masters or doctoral programs, even if they are accredited.

Accreditation is given by regional and national organizations. A school applies for and receives accreditation based on its curriculum, standards, and performance of its students on tests and other measures. Not all schools are accredited by every organization, but a school must meet basic accreditation requirements to be qualified to receive federal funding of any type, including Pell Grants for its students. The United States Department of Education provides a list of all schools that meet accreditation standards required for distribution of federal funds online.

How do I get a Pell Grant for an Online School?

In order to qualify for the Pell Grant, federally-backed student loans, or any other type of financial aid, you must complete a Free Application for Federal Student Aid or FAFSA. You can do this online or by visiting your school’s financial aid website for assistance.

The FAFSA will ask you to provide your most recent tax return information or that of your parents (for dependent students). Dependent students are students who receive the bulk of their financial support from their parents even if the parents are not paying for college. It is crucial that you fill out the FAFSA as accurately as possible. Aid awards made based on incorrect FAFSA information can be revoked, or you can be required to pay that money back. It is always best to be honest about your financial situation on the FAFSA.

Once you have submitted a FAFSA, you will receive a report that outlines your family’s expected financial contribution or EFC. This is the amount you or your family could theoretically pay toward your college. Of course, you may not have access to this money, but it must be considered in any award of aid made by the federal government.

Besides your EFC, you will also receive information about your eligibility for grants or loans. You may also be eligible for work-study or other programs to help offset the cost of your education. Of course, if you are attending a completely online school, this may not be as feasible for you as for a student who is attending an on-campus program. If you are awarded a Pell Grant, you will be told the amount in your EFC report.

How do I use Pell Grant Money at an Online School?

Pell Grant funds are not sent directly to you. Rather, they are sent to the school listed on your application for aid and applied toward tuition costs. If your costs do not equal the amount of the Pell Grant, the unused portion will be returned and not given to you. Pell Grant funds can never be used to pay personal expenses.

College financing can be a difficult maze to navigate however understanding how grants works is a critical piece of reducing your overall cost of a college education. Speak to you school’s student financial office, talk to friends and make sure to put in as much time as needed to qualify for grants available.