Loan Blogger

Understanding the Pell Grant from Uncle Sam

One of the most widely available grant programs for students entering college is the Federal Pell Grant program. This program is one of the only ones that offers “free government money” so that you can go to college. If you’re eligible for a Pell grant, you don’t have to pay back the money. They are also not awarded based on grades. Solely a needs-based financial aid online program, the Pell grant determination is based upon your “Expected Family Contribution.” Those who have significant financial need can receive money.

The amount of money you can receive through a Pell Grant changes from year to year. The federal government determines how much money they’re going to put into the financial aid option in general, and that will determine how much you’ll receive individually. The amount is also chosen based on how much the college classes will cost, what the Expected Family Contribution is going to be, and whether or not the student is enrolled full time. In regard to the 2008 2009 school year, for example, students could receive the maximum amount of $4731.

It’s interesting to note that with the Pell Grant program, and with other federal loans, there is no lifetime cap. Programs that do have lifetime caps limit how much you can borrow. Pell Grants are only limited by the students and the length of time it takes them to get their first bachelors degree. If that takes eight years, the money is available for eight years.

You’ll need to fill out the FAFSA if you want to apply for the Pell Grant. Be honest on this form, because failure to report all income or assets will result in tough penalties, including possible jail time. The FAFSA information you provide determines what you’re Expected Family Contribution is. Even if you think you won’t qualify because your family makes too much money or has too many assets, fill out the FAFSA. The formula is complicated, and you may qualify for some help that you do not know of.

Since this is also the way to qualify for federal loan programs, go ahead and fill it out. After you do so, the form goes on to your college or university, and they’ll take out the Expected Family Contribution from attendance costs, and determine what you’ll be expected to pay for attendance. If you are going to get some Pell grant money come you’ll get a letter telling you so. There is nothing else you can do to ensure that you get this money. While you wait, pursue other financial aid options. The amount given to you in a Pell grant will likely not pay all of your schooling expenses, so you’ll still need other financial aid.