Who are Eligible for Financial Aid?

Around $150 billion of grants, student loans at low rates of interest and work- study funds are provided by the US Department of Education to help over 15 million students every year. Federal student aid can be in the form of Grants, Loans and Work- study. These three forms are different from each other.

Grants are a type of financial help that does not require a repayment, unless the borrower owes a refund due to withdrawal from school. This is a need- based financial help by the federal government and is also referred to as ‘gift aid’ because they do not require a repayment. There are several types of grants available such as Federal Pell Grants, Federal Supplemental Education Opportunity Grants, Teacher Education Assistance for College and Higher Education Grants and Iraq and Afghanistan Service Grants. Student loans on the other hand are a type of financial help that need to be paid back with interest after the student starts working. Various loan repayment plans such as income repayment plan, income- contingent repayment, pay as you earn repayment plan, standard repayment et cetera are available to a borrower to facilitate such repayment.

The US Department of Education offers two types of loans, namely, William D. Ford Federal Direct loan and Federal Perkins Loan program. With the passing of time, the horizons of student loan programs have been further broadened to benefit more people in genuine need. The third form of financial aid is a Work- study program which is a work program by which a student can earn and pay for his education expenses. Such a program is available to undergraduates, graduates and students of professional studies. A work study program provides a student enrolled in school (part-time or full- time) with part- time employment.

Federal student aid can be used by a borrower to pay for expenses such as tuition fee, transportation, books and various indirect expenditures such as computer and living costs. This financial aid can come from the Federal government or the state where the student is living, his/ her college or institution or any non-profit, private organization working towards the cause of education. But what does it take to avail the benefits of such a financial help. Let’s look at the eligibility requirements for this help.

Eligibility Criterion for Financial Aid

  • The student must be qualified enough to obtain a college degree. This implies that he/ she should have high school diploma or a certificate of general education Who are Eligible for Financial Aiddevelopment or should have completed school education in a homeschool setting which is approved by the state law. 
  • To be eligible to receive student financial aid, the student must be enrolled or approved to be enrolled in an eligible certification or degree programme as a regular student.
  • The student should be registered with selective service, for male students, they must be registered between the age of 18 to 25 years. 
  • The borrower should not have default status in any of the previous student loans and no refund should owe on a federal grant. Also, the student is supposed to use the money coming from federal financial aid for education purposes only and not otherwise. The student is expected to maintain a satisfactory academic record in his/ her institution. 
  • Some basic requirements to avail a student financial help is that the student should be a US national or citizen or a permanent US resident. The student is required to have an Arrival Departure Record, Battered Immigrant Status and have a T-VISA. 
  • Once the financial aid has been availed, the student is required be remain eligible for the aid by filling up the FAFSA and keeping a track of one’s graduation. 
  • Sometimes, some students might lose their eligibility for federal financial aid due to default on a student loan or poor academic record in the school or college or if the student is convicted for drug use. However, this loss of eligibility can be regained by working in the right direction. 

Eligibility under special circumstances

  • Students with a parent(s) killed in Afghanistan or Iraq during military service in the events following 9/11 might be eligible for an additional Federal Pell Grant program or the Iraq and Afghanistan Service Grant. 
  • Eligibility for federal student aid is limited for people with conviction for drug offence or who are supposed to complete involuntary civil commitment due to sexual offence. 
  • Students having intellectual disabilities are eligible to receive federal financial aid in special circumstances via the Pell Grant, Federal Work Study programmes or the Federal Supplemental Educational Opportunity Grant. 

Myths about financial aid

  • Wealthy parent= no aid: This is a popular myth when it comes to financial aid. Many students believe that they would not qualify for a federal student aid just because their parents are earning handsome salaries. This is not the reality. Every student can apply for a financial aid with no regard to their parents’ salaries. 
  • Good grades= financial aid: This is not really a sure shot formula for availing financial aid. Students with not so great scores are also eligible for financial aid. Students active in sports and o-curricular activities can also qualify for an aid. 
  • Age barrier: It is never too late to avail financial aid. Age does not count when it comes to federal financial help. Financial help is awarded on the basis of need and not age.


Financial help can be an effective measure to meet one’s education expenditures only if someone is aware enough as to how to use them. A student should not be stuck in myths and should apply for a financial aid if need be. These financial help programmes aim to benefit the students who are willing to study but are not financially strong enough to support their expenses. With the growing prevalence and need for such programmes, it should however, be understood that the dependence on such programmes should be kept minimal and one should not necessarily take out excessive grants or loans.