There are many types of financial aid. They fall into four major categories—free money, work-study, military aid, and education loans.

1. Free money usually comes in the form of scholarships and grants. Scholarships and grants do not require repayment. Scholarships are funded by organizations and their eligibility requirements will vary depending on the program. Grants are based on financial need and given by the government, state agencies, colleges, and other organizations.
2. Work-study programs provide jobs for students with financial need, allowing them to earn money to help pay education expenses.
3. Military aid programs offer money for school in exchange for military service, either before or after college.
4. Education loans must be repaid and are offered in a variety of programs.
   • Perkins loans: Relatively low cost federal loans awarded through colleges for students with exceptional financial need. These are based on federal standards and funding levels.
   • 2Futuro Loans: Federal Stafford loans are made to students and PLUS loans are made to parents through two loan programs. These are the types of loans that Sallie Mae and USA Funds can provide you through 2Futuro.
     • Federal Family Education Loan Program (FFELP): Loans made to students (Stafford loans) and parents (PLUS loans) with private funds and insured by the federal government.
     • Federal Direct Loan Program (FDLP): Loans made to students and parents by the Department of Education and colleges using federal funds.
   • Private loans: Loans from a variety of sources—including financial institutions, educational institutions, and professional associations—are designed for students and their parents. Often used to supplement federal loans and other aid to cover the full cost of education. Special programs may be available for graduate students in business, law, and health professions.
   • Other loans: Loans such as home equity or personal loans (borrowing from insurance, retirement plans, etc.), that are not specifically designed to be education loans can still be used to pay for college. Interest on some loans may be tax deductible for certain borrowers.

   Only consider borrowing when you have exhausted all other options for paying for college.

    

   How is financial aid eligibility determined?