Types of Financial Aid

Scholarships

You can get a scholarship based on your grades, athletics, a unique skill, a special talent, financial need, or even a specific career interest. Scholarships can be a one-time gift or yearly, depending on the scholarship. While most scholarships don’t have to be repaid, some do have certain program requirements and/or obligations .

Grants

Grants are usually based on financial need. They are generally provided by the state or federal government or the college you plan to attend.

By completing the Free Application for Federal Student Aid (FAFSA^®), you'll be considered for both the Federal Supplemental Educational Opportunity Grant (FSEOG) and the Federal Pell Grant. These are both need-based grants and are available to undergraduate students. The FAFSA will also determine if you are eligible for the need-based Illinois Monetary Award Program grant .

Federal Work Study

Federal Work-Study is a financial aid program for students who have financial need. It gives you the chance to work part time while you are in college so you can earn money to help pay for school. A Federal Work-Study job is different from a regular job because your work schedule is built around your class schedule. Also, when you apply for financial aid the following year, the money you earned through this program isn't used to determine your financial need. The information you provide on the FAFSA will determine whether you are eligible for Federal Work-Study Find out more about Federal Work Study Programs.

Loans

Loans are money that you borrow to help you pay for school. This is money that you have to pay back, and usually you must pay back the original amount plus money called “interest.” Colleges determine your loan eligibility after considering the grants, scholarships and Federal Work-Study program(s) you have been offered. Only borrow you need. Before you borrow, always apply for scholarships and grants, because you don't have to pay them back. Remember, the more you borrow, the more you have to pay back!

There are several different types of student loans. Federal student loans generally have the best repayment options and lower interest rates. Direct subsidized loans are based on family financial need. Direct unsubsidized loans are not based on need. Note that there are limits on how much a student can borrow in Federal Direct Loans. Learn about Direct Unsubsidized and Subsidized Loans.

Federal Parent Loans allow parents to borrow to pay for their student’s education. These loans also have borrowing limits. Learn about Federal Direct Parent Plus Loans.

Banks and other lending institutions may offer Alternative or Private Loans. The amount you are able to borrow and the interest rate are usually based on your credit history and may require a co-signer. Find out more about Federal versus private loans.

The Illinois State Treasurer’s Office also offers lower interest private loans through their Student Empowerment Fund (SEF). They offer three different types of low interest private loans—for students, parents, and one designed for borrowers who have struggled to access private student loans because of a lack of credit score or adequate cosigner. Find out more about loans through the Illinois Student Empowerment Fund.

To help student and parent borrowers track their student loan debt, Illinois public universities and community colleges must give borrowers the following information every year:

• an estimate of the total amount of education loans borrowed by the individual;
• an estimate of the projected monthly payments and total payoff amount (including principal and interest), as of the time the information is provided;
• the percentage of the borrowing limit that has been reached by the individual, as of the time the information is provided; and
• financial resources that are available to the borrower.

For more information, contact the financial aid office at your (or your student's) Illinois public university or community college.