Federal Financial Aid for Students in the USA
Studies are one of the most important investments in a life of an average American. Unfortunately, many young people cannot afford to pay for their education. The good news is that, for last ten years an average financial aid per student has changed, in favor of student.
There are a lot of financial aid sources to support students and their families during their education. Generally, they are three accessible forms of financial aid for students. The first one is scholarship, which is a non-returnable support. The others are: take a loan and get a job, often subsidized by the federal government.
Not so long ago, the most common form of financial support were scholarships, but nowadays are loans, which is about 60% of the total money intended for that purpose.
Federal Government Scholarships
There are a few federal scholarships programs, mainly for undergraduate students. The most known one is Pell Grant. The amount of money, that student gets, depends on family annual income and the total costs of studies at the given university or school. The second program is SEOG (Federal Supplemental Educational Opportunity Grant). This one is granted to students who have the lowest annual income. They can get from $100 to $40000 per year, in order to cover educational expenses.
Federal Student Loans
Federal student loans constitute about 60% of the money for the financial student aid programs. They are divided into two groups, those which are subsidized by government and those which are not.
In the first one, the government covers the repayment of interest until the studies are finished by a student.
In the second one, the interest is assessed from the moment when the loan has been granted.
The best federal program, from a student’s point of view, is Federal Perkins Loan. The interest rate is just about 5% per year. They are granted to undergraduate students and those who already have their degree. For the first one the amount of money is about $3000 a year (maximum $15000), others get $5000 per each year of studies (with the maximum of $30000).
The most common federal loan program is Stafford Loan, which can be granted to any students on any educational level. In case of the low family annual income they are subsidized by government. They can also be non-subsidized loans, which are granted on the basis of the student’s application, regardless of the student’s family income.
Federal government also gives loans to student’s parents. The interest rate is changeable, however, cannot be higher than 9%.
Procedures of Granting Federal Financial Loans
Criteria of granting federal financial loads are rather complex.
The federal financial backing can be given to anyone who is a citizen of the USA or who has the status of ‘eligible noncitizen’. Within this group are permanent residents, refugees, those who possess the status of indefinite parole or humanitarian parole, or people who managed to cross a border before 1st April 1980 as a conditional entrant. Unfortunately, those who have just submitted the application form for a green card and possessing only the confirmation of approval for submission of application for the status of permanent resident cannot get the federal financial loans. The same concerns the students which are in possession of student visa and the international organizations workers and their families with G visa.
The next condition, which has to be fulfilled, is submission of the secondary school certificate, university diploma degree or other document which is accredited by a given state or Department of Education. In order to obtain the federal financial loans students must have sufficiently good grades; an average should not be less than C.
The next condition is having a valid Social Security number. The final step is filling up an application (FAFSA: Free Application for Federal Student Aid) and in case of male students enlisting in the Selective Service.
How to Submit an Application
An application form for the federal financial loans can be found in secondary schools and financial aid offices at universities. It is also possible to fill up the electronic version of the application form on the website of Department of Education (www.fafsa.ed.gov).
It is required to keep the duplicate of the application form, in order to answer to possible office workers’ questions. The form should be submitted at the beginning of the given year after the first of January until 30th June. Three weeks after the submission of the application form, student gets the Student Aid Report (SAR). It says how much the family of given student should be able to pay for their studies. Than SAR is sent to the university and than the financial loan is prepared, on the basis of the sum, which can be covered by parents. The granted amount is simply the reminder between the total costs of studies minus the possible amount paid by parents.
Work during the Studies
The last example of federal financial aid program for students is federal subsidiary, which partly covers the expenses of student employment. The work-study federal program allows students to earn money during their education. Because of that they are able to pay their school fees.