Many people are confused by Financial Aid and Financing when it comes to monetary assistance for attending makeup school. This blog is meant to clear up any confusion you may have about the two.
According to the FAFSA website this is their statement concerning their functions:
“Federal Student Aid is responsible for managing the student financial assistance programs authorized under Title IV of the Higher Education Act of 1965. These programs provide grants, loans, and work-study funds to students attending college or career school.”
Financial Aid can come in the form of grants, loans or work-study funds. Those who qualify for Financial Aid usually may also qualify for other types of financing. FAFSA (Free Application for Federal Student Aid) will be able to help you with the entire application process and determine what kind of financial aid is available to you. A “package” containing your financial aid options will be put together for you by your school’s financial aid staff.
Funding for Financial Aid can be either federal or nonfederal. Financial Aid that is run and monitored by the U.S. government is federal funding and those that come from other sources are nonfederal funding. A Federal Student Loan is a government funded loan that helps you to pay for your education. Because this is a loan you must repay it with interest. A Grant is financial aid that is mostly based on financial need, which does not need to be repaid unless you fail to complete your schooling.
In addition to federal and nonfederal financial aid and grants, you may also qualify for a scholarship. Scholarships are funds awarded to students based on academic and/or other achievements or criteria to help pay for education expenses, and generally don’t have to be repaid.
Financing is different than Financial Aid in that you do not receive monetary assistance up front. Instead, you will adhere to a payment schedule in order to pay for your schooling. It is similar to a car payment schedule and is generated by the school you are attending. You may be required to come up with a down payment before you begin or within a short period of time after your start date. After the initial deposit of funds, you will make smaller scheduled payments within a certain time frame. Sometimes you may be offered a grace period or extension depending on the school and your individual circumstances. Additionally, you may or may not have to pay an interest fee for the financing; it depends on the institution that’s offering you the payment plan.