Funding for College

For many students, finding ways to fund college other than out of pocket is essential. There are different types of financial aid, or funding for college including scholarships, work-study jobs, grants, and loans.

• Scholarships are “free money” offered to help students pay for college. Scholarships can be based on academics, talents, or area of study. Students should apply for as many scholarships as they are eligible for. In addition, scholarships do not have to be repaid.
• Federal Work-Study provides part-time jobs for students in financial need to help pay for expenses.
• Grants are also considered “free money” that do not have to be repaid as long as eligibility requirements are met. Most grants are federal money and are awarded based on financial need. Students must complete the FAFSA to become eligible for federal and state grants.
• Loans are a form of aid that must be repaid. This is money you borrow and pay back with interest. Loans are offered by the federal government and private organizations.

Federal vs. Private Student Loans

Federal student loans are provided by the government and often include fixed interest rates that are generally lower than private loans. Federal loans offer more flexible repayment options. Private loans are provided by banks or state-affiliated agencies and often require a co-signer. Private student loans should be a last resort option to cover college costs.

Subsidized and Unsubsidized Loans

Subsidized and unsubsidized loans are the primary loans offered by the federal government. Subsidized loans are only offered to undergraduate students in financial need. Need is determined by the federal government with the FAFSA application. Unsubsidized loans are available to all students and is not based on financial need.

Direct PLUS Loans

Direct PLUS loans are offered to graduate and professional students or parents of undergraduate students only and can be useful if subsidized or unsubsidized loans or other forms of financial aid do not cover all costs of attendance. These should be a last resort next to private student loans.

Completing a FAFSA

Students wishing to receive federal financial aid such as grants, loans, or work study must complete the Free Application for Federal Student Aid (FAFSA). FAFSA information is also used to determine eligibility for certain state and school financial aid. Completing the FAFSA does not obligate you to accept any financial aid offered, you will be able to review and decide what aid you need and want to accept. For additional information on special circumstances for financial aid visit UA Student Financial Aid and Federal Student Aid.