By DeVry University
Are you interested in pursuing a degree, but unsure how you can pay for it? Fortunately, there is help. Here’s a “financial aid 101” breakdown of what you need to know about the various ways to finance your college education.
Financial Aid 101
Financial aid comes in three basic forms: loans, scholarships and grants. Some students are able to finance their education using just a single source, while others combine funds from two or even all three categories of financial aid. Read on for detailed descriptions of each to determine which option – or mix of options – might be best for you.
Think of a scholarship as gift money that you don’t need to pay back. It comes from a private source, which could be an employer, a school, a nonprofit, a community organization, an individual or even a religious group, to name just a few possible providers. The criteria for receiving a scholarship are entirely up to the giver.
Many scholarships are merit-based, given to those who show exceptional achievement in some area such as academics, sports or the arts. Others are given to those who fall into a specific category, such as employees of the institution that provided the scholarship or those with demonstrated financial need. In most instances, you will need to submit an application in order to be considered for a scholarship.
There are thousands of scholarships available each year, but they can be difficult to find. Besides your school’s financial aid office and your employer, one of the best sources is the Department of Labor’s Scholarship Finder tool.
- No repayment required
- Privately administered
- No interest or fees
Grants also don’t need to be paid back, except under certain circumstances such as withdrawing from school or not completing a specific obligation required by the grant. Many grants are federal, including but not limited to Pell Grants and Federal Supplemental Educational Opportunity Grants (FSEOG). You can find more information about federal grants, including eligibility requirements, at the US Department of Education’s Federal Student Aid website.
Some states offer educational grants as well. There are also private grants, as well as grants that may be offered through your school. At DeVry University, we offer both scholarships and grants to students who apply and qualify.
- No repayment required unless you fail to meet the requirements of a specific grant
- Both federal and private options are available
- No interest or fees
Student loans are a bit more complicated, because they do require repayment. There are four types of federal student loans you can apply for:
Direct Subsidized Loans
Undergraduate students who can prove financial need may qualify for Direct Subsidized Loans. The federal government pays the interest on these loans while you’re in school half-time or more, for six months after graduation, and anytime you’re in a qualified deferment.
Direct Unsubsidized Loans
Direct Unsubsidized Loans are available to both undergraduates and graduate students, regardless of financial need. Your school determines the amount you are eligible to borrow as part of your full financial aid package. You are responsible for all the interest on these loans, though you may allow it to accrue and be added to the principal of your loan while you are in school or deferment.
Direct PLUS Loans
Direct PLUS Loans are available to graduate students and the parents of undergraduate students. They are not based on financial need, but you must pass a credit check. Borrowers with a poor credit history may be able to take out a PLUS loan with some additional requirements.
Direct Consolidation Loans
These loans allow you to roll all of your federal student loans into a single loan with a fixed interest rate and one servicer. This gives you a single monthly payment for all your federal student loans.
Private educational loans may also be available. Talk to your bank, credit union or other financial institution for more information.
- Repayment required
- Both federal and private loans are available
- Interest is charged, though the federal government pays the interest on subsidized loans while you are in school or a qualified deferment
Financial Aid for Military Members
Active duty military or a veteran? You may qualify for additional financial aid programs. These include VA education benefits, special rules on federal loans and privately administered scholarships through organizations such as the American Legion. Today’s Military maintains an updated list of financial aid programs designed for military members.
Applying for Financial Aid
If you are interested in receiving financial aid, the first step is to complete a Free Application for Federal Student Aid (FAFSA®). This form requires you to input your personal financial information. If you’re a dependent student, you will need to enter your parents’ financial information as well. There are specific criteria for determining whether you’re dependent or independent, but in general you are considered a dependent student if:
- You’re an undergraduate student under age 24
- You are unmarried with no dependents
- You have not served in the military or been a ward of the court
Specific school-based forms may be required, as well as separate applications for private loans, scholarships and grants.
Your school financial aid office will receive the results of your FAFSA and put together a financial aid package for you to review. After reviewing your package, you can decide whether to accept all, some or none of the aid. You’ll need to sign forms (including a promissory note for any loans) for all financial aid you choose to accept.
We're Here to Help
Financial aid is a complex topic, and deciding between loans, scholarships and grants is a highly personal choice. At DeVry University, our Student Finance team is here to help you sort through your options. Take a look at our Tuition and Finance information, and then contact us with any questions you might have.