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How to Use Federal and State Government Aid for Your Child’s College Education

June 01,2010 by: Dallas Browne

Federal and state government aids are basically two types of financial assistance given by the government. But these two aids are quite similar in many ways. Both require applicants to fill out FAFSA forms and both have low interest rates as declared by the government. Federal and state government aids simply differ on the scope of the financial assistance it offers.

Project EASI (Easy Access for Students and Institutions) and the US Department of Education are offering scholarships for college students under the federal educational aids division. This type of aid is open to all students studying within the jurisdiction of the United States. Also, federal aid has lending standards that is common throughout the country. Well, it may differ on the amount of loan given to each year level. The point is that a college sophomore in Alabama will get the same maximum student loan that is also available to a sophomore in Wyoming when they both apply for federal aid.

On the other hand, state government aid is limited only to the state where the student is a registered resident of. This is the more flexible government aid, but still, there are maximum amount of loans allowable for each person. Some states allow a student to get a loan for his tuition fees. Other states also allow loans for paying off rented spaces near the school or other auxiliary expenses incurred while studying. Ultimately, state loans can apply a more personal, case-to-case basis assessment of a student’s needs.  

Once students apply for state government aid, the information they forward to the US Department of Education will be passed to the state student assistance agency. These agencies will then determine the extent of financial aid that will be granted to you.

And the best thing about this financial aid is that it can also be a merit-based type of aid. Students who have been excelling in their subjects will be able to apply for higher loans provided that it is a justified need for the completion of the course program. There is no need to probe into the parent’s credit report because government aids are not based on creditworthiness. The eligibility for this government aid is by virtue of the student’s academic performance.

All types of government educational loan require that the FAFSA application form be passed before March 1. Failure to do so will mean that the student will not receive financial assistance for the whole academic year. But when this happens, cash-strapped students can simply resort to applying for private loans. This type has heftier interest rates so the next time the FAFSA announces its deadline, be sure to pass it on time.

Federal and state government aids are indeed helpful to lots of student all over the country. A majority of students and parents surveyed throughout the country mentioned about getting financial aid from government educational loans for their child’s college fees. With its affordable interest rates and easy eligibility requirements, students can finally be assured of receiving college education with the government’s help.


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