So you’re thinking about school but you’re not sure how to pay for it? Financial aid can be a big help, but sometimes it can be confusing. We’d love to help you figure it out and we hope this will help.
What is financial aid?
- Financial aid helps students pay for school and other related expenses. It can come in different forms. Some forms are need-based, like grants and some loans. Eligibility for these will be determined by financial standing. There are others that are merit-based, like some scholarships. That means those who receive them are chosen based on talent, grades, or other qualifiers.
What is the difference between grants and loans?
- The difference between the two is that loans MUST be repaid while grants do not. At our school, many of our students receive a combination of Pell grants and Direct loans, which may be subsidized or unsubsidized. Subsidized loans are loans that the government will pay for the growing interest until your grace period is over[i]. An unsubsidized loan will start to grow interest that you are responsible for from the first disbursement. Neither loan will enter repayment until after your grace period is up.
How do I know if I’m eligible for federal financial aid?
- In order to see if you qualify for any federal financial aid, you must first fill out the FAFSA (Free Application for Federal Student Aid). This application will look at your (or your parents’) income from the previous year and family size. After it is completed, results will be sent to the school that you choose and they will be able to make up an award letter for you, so you know what kind of aid you can use to pay for school. Most people do qualify for financial aid!
How do I start paying back my loans?
- When you take out a federal student loan, you will be assigned to a loan servicer. That is the company that you will actually make your monthly loan payments to. You will have six months after you leave school where payments will not be required. This is called your grace period. Though they aren’t required, payments are accepted while you are in school and during your grace period.
- Different payment plans will be available to you while in repayment. Some will depend on the amount owed and others will be income-driven, meaning that the monthly amount due will be determined from the money you make. You will always start off on the standard repayment plan. If you are interested in a different repayment plan, you will need to contact your loan servicer for the next step.
What if financial aid isn’t enough?
- If after you fill out the FAFSA, you find that there is not enough aid available to cover the cost of tuition, our school also offers monthly payment plans to make up the difference. This will allow you to start classes and pay off your balance a little at a time.
[i] For loans first disbursed after July 1, 2014 (https://studentaid.ed.gov/types/loans/subsidized-unsubsidized)