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Grants Are a Form of Free Financial Aid

We've looked at scholarships as a form of free money for college but let's not forget about the raft of grants available. Grants are literally known as gift aid or free financial aid for students. They are money gifts that, unlike loans, do not have to be repaid. Let's take a few minutes to explore the types of grants that are accessible. They can be split into three main categories and are outlined below:

1. Federal Grants

Federal grants accounted for 21% of federal aid awarded in the 2003 2004 academic year . These are grants that are fully supported and funded by the government and act as a form of free financial aid for students. The main types of federal grants available are:

The Pell Grant

The Pell grant is known as the grant for low income families. It is a need based grant that is awarded based on the financial need of the student. The families Expected Financial Contribution (EFC) will be calculated based on the information given at time of application. The rest of the tuition costs and expenses will be paid for by the award that the student will be given, which is made up of grants and loans. The maximum amount of a Pell Grant that anyone can receive is $4,000 per academic year so it can be a valuable source of free financial aid.

Supplemental Educational Opportunity Grants (SEOG)

This form of free financial aid is generally available for students who are pursuing their first bachelor's degree. Normally only students who qualify for the Pell Grant can receive this grant. This is a needs based form of money for college too and does not have to be repaid. These are campus based programs and administered directly by the college or university you attend.

Leveraging Education Assistance Partnerships (LEAP)

The federal government also tries to encourage states to provide grants to low income families by matching the amount a state grants on a dollar by dollar basis. This is known as LEAP but unfortunately such grants have declined by 12 % in the last decade.

To receive any of the above federal grants, they will be awarded based on the information you submit on your FAFSA. As this proves to be an essential source of free financial aid you should always make sure when the submission date is as the loans and grants awarded will literally be your financial life line.

2. Institutional Grants

Institutional grants are available from the college or university you attend. Rather than being needs based, these tend to be more merit based grants. From research conducted, it tends to be students with parents in the upper income brackets that qualify for such aid.

3. State Grants

These grants are merit based grants too and are awarded by the state that you reside in. You should conduct further research into availability and you will probably have to apply for this form of free financial aid separately.