Looking for higher education but cannot afford associated costs. Understanding Federal Pell grant program might offer some solutions to your problems.

What is Pell Grant?

Pell grant is a kind of financial assistance given to low income undergraduates and post baccalaureate students to help them in obtaining post secondary education. The grant given under this program can be used by students at around 5400 institutions. These institutions give direct grants to students meeting the eligibility criteria. Such a grant is generally available from one school only. The amount of grant is either directly credited to the availing student’s school account or paid by cheque.  A combination of both the methods can also be used while extending the credit. A unique benefit associated with Pell grant program is that the amount given as loan is not required to be paid back.

What is the Eligibility for Availing Benefit Under this Program?

Here the school extending the grant has to ensure that the beneficiary is eligible as per the requirements specified by FSA (Federal Student Aid). Since it is an aid, a student must meet certain specific criterias as to his financial condition. In simple words, to obtain grant under this program, a student should have a financial need. This grant is not limited to U.S. citizens only but also extends to eligible non U.S. citizens. Grant extended under this program can change from year to year which would ultimately depend upon the changes in your family’s income or asset status.

How is the Loan Amount Calculated?

A common formula used to determine the financial need is Expected Family Contribution (EFC). This formula generates an EFC number for each applicant. It is based on a simple concept that lower the EFC of any student, higher is his/her requirement for financial assistance. For Instance, if a particular student’s EFC comes out to be zero, it would indicate that this student is in need for maximum grant under this program. Maximum grant for the period starting from July 1, 2011 and ending on June 30, 2012 is $5,550. How this EFC is calculated? As a part of this grant process, any student willing to obtain grant, is required to fill in FAFSA (Free Application for Federal Student Aid) which can be filled online.

On the basis of information provided in FAFSA, , EFC is arrived at and by considering several other factors like cost of attendance which includes fees and tuition costs, allowance for books, transportation, supplies, cost of room and board charged by the institution,  and type of enrollment (as in part time or full time) a student’s eligibility is determined. A document is generated and forwarded to schools on basis of which aid may be offered to any student if all other requirements have also been met. It is important for a school to verify that any student is not receiving this benefit under this program from any other school.

How can Applicant Know the Amount that has been Approved?

Schools are required to inform the students in writing on the amount that will be paid and when this amount will get disbursed. Disbursements are generally made at least once every term during the award year or atleast twice for programs without any terms.

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