Types of Financial Aid

Most federal student aid is need-based, taking into account an expected family contribution (EFC). Need-based financial aid comes in three basic types:

Grants and Scholarships, which are considered gift aid and generally don't have to be paid back (sometimes a repayment is required if a student withdraws);
Work-Study, which is money that you earn by working part-time while in school; and
Loans, which are funds that you (or your parent) borrow and must be paid back, usually after you leave school.

The following chart details the main federal student aid programs administered by the U.S. Department of Education. Not all schools participate in all of the programs listed.

Program	Description	Application	Annual/Aggregate Amounts	Eligibility*	Repayment Required
Federal Pell Grant	Grant program	FAFSA required annually	Annual minimum and maximum vary $336 minimum for 2021-22 $6,495 maximum for 2021-22 600% lifetime limit	Undergraduate students without first baccalaureate or professional degree Certain students enrolled in a post-baccalaureate teaching certification program Based on need	No
Federal Supplemental Educational Opportunity Grant (FSEOG)	Campus-based grant program; funds awarded by Institution	FAFSA required annually	$200 annual minimum $4,000 annual maximum (students on approved study abroad programs may receive up to $4,400) No aggregate limit	Undergraduate students without baccalaureate or professional degree First priority given to Federal Pell Grant recipients with “exceptional financial need” (defined by law)	No
Federal Work-Study (FWS)	Campus-based employment program; funds awarded by Institution	FAFSA required annually	No minimum or maximum Award amount is dictated by school policy	Undergraduate and graduate students Based on need	No
Federal Direct Student Loan (Direct Loan)—Subsidized and Unsubsidized Loans**	Direct Loan funds from federal government; fixed interest rate	FAFSA required annually; MPN obtained from Direct Loan school	$3,500 1st year undergraduates $4,500 2nd year undergraduates Annual limits prorated for programs and remaining periods of enrollment less than an academic year $23,000 subsidized undergraduate aggregate limit $2,000 limit for dependent students (unsubsidized) $6,000 limit for independent (unsubsidized) $57,500 combined sub & unsub undergraduate aggregate limit	Undergraduate enrolled at least half-time Must first have determination of eligibility/ineligibility for Federal Pell Grant Must determine eligibility for subsidized Loan before determining eligibility for unsubsidized Loan Interest subsidy based on need Unsubsidized funds may be used to replace EFC	Yes; begins 6 months after cessation of at least half-time enrollment; deferment possible; no interest subsidy on unsubsidized loan
FFEL/Direct PLUS**	FFEL funds from private lenders; Direct Loan funds from federal government; 8.5% fixed interest rate for FFEL PLUS and 7.9% fixed interest rate for Direct Loan PLUS	FAFSA required annually; PLUS MPN obtained from FFEL school or lender or from Direct Loan school	No annual or aggregate amounts, except parent or graduate/professional student may not borrow more than difference between cost of attendance and other financial assistance student expects to received	Natural and adoptive parents (and stepparents if included on FAFSA) of eligible dependent undergraduates enrolled at least half time and graduate/professional students No adverse credit history Must not be in default on a federal loan Must be a U.S. citizen or eligible noncitizen May be used to replace EFC	Yes; begins 60 days after fully disbursed