Your state is a source of scholarship funds. The federal government administers a number of grant and loan programs for undergraduates through the Department of Education. Investigate other sources, private as well as public. For instance, did you know that many state departments of transportation offer scholarships, as do some corporations and professional associations? Apply for them. Finally, banks can arrange home equity loans and education loans, and you can compare rates on their loans to those available through state and federal sources. Rates and loan terms change frequently, and federal funding is subject to budget constraints and congressional approval, so be sure to get the latest information before deciding on an aid package.
Since the costs for any college education are very high, and costs for engineering education are somewhat higher than average, it is important for you to investigate all possible sources for financial aid, which can come in many different forms. Basically, the overall process involves the student's making an application, furnishing information about family income and assets as well as financial responsibilities, and the evaluation of the application by the college administration or by a governmental agency responsible for supplying financial aid. Many students may be eligible to receive aid from the Department of Veterans Affairs or from the United States Departments of Education or Health and Human Services. Scholarships and loans are available from various organizations and from individual schools and colleges. Many employers as well as many social and professional organizations offer scholarships and loans for students who are in some way connected with members of these groups (usually family members or future members of particular professions). In some instances, the benefits available to veterans also can be applied to their dependents. Information concerning all the educational benefits available to veterans can be obtained by contacting a local Veterans Affairs office. Assistance is available also through the Red Cross for veterans who are unable to make contact with the Veterans Affairs staff.
The most common source of student financial assistance is the United States Department of Education. This assistance is furnished under a number of different programs. In the Supplemental Educational Opportunity Grant Program, students with exceptional financial needs who are unable to continue their education without assistance are eligible for awards.
The Basic Educational Opportunity Grant Program is another source of funds for eligible students. Pell Grants are federal grants of about $2,350 a year awarded to undergraduate students from families that qualify based on income. Full-time students of universities, community colleges, and junior colleges may apply for financial assistance under this program. Usually, applications for this type of assistance are available from high school counselors, from colleges, and from public libraries. Applications may be obtained by calling 1-800-4FEDAID (433-3243) or writing to Federal Student Aid Information Center, P.O. Box 84, Washington, D.C. 20044. If the program administrators consider the student eligible for a grant under this program, a notice is sent to the college of the student's choice, and the college administration participates in determining the amount of the actual award to the student. The amount of the award is calculated by the college on the basis of the costs of tuition and the capabilities of the student and her or his family to meet those costs.
Many universities and colleges grant direct academic scholarships on the basis of ranking in high school graduating class and college entrance examination scores. Usually, the required entrance test is either the Scholastic Aptitude Test (SAT) or the American College Test (ACT). Some states have special financial aid grants for residents of those states attending private colleges or universities within the state. Other scholarships are available specifically for women and minority group members, or for students with affiliations to particular groups. Information on this type of financial aid is available from the university directly.
The main loan program of the U.S. Department of Education is called the Stafford Loan. You can apply on campus if your school participates in the Direct Loan program, or apply to a participating local lender in the Federal Family Education Loan (FFEL) program. The government sends your money directly to the school or the lender and then to you. If you're applying based on financial need, you can defer payments on this type of loan. Otherwise, the loan payments with interest begin as soon as you get the money.
To qualify, you have to be a full-time or half-time student in an approved program and meet certain other requirements. Loan amounts begin with a $2,650 limit for first-year undergraduate students and gradually increase to $5,500 a year for students who've completed two years of study. If you can show need you can borrow more, up to $10,500 a year in the 1996-97 loan program. Graduate students can borrow up to $18,500. The limit on total debt from all Stafford loans is currently set at $46,000 for qualified undergraduates and $138,500 for graduate students. The interest rate is adjusted each year in July, but can't exceed 8.25 percent (1995-96 rates). Loan fees can run as high as 4 percent and are deducted from the loan payout. You pay back the loan monthly for a term of up to 10 years. For example, if you borrowed $5,000, you'd pay $61 a month under the standard repayment plan. Ask about extended payment plans.
You apply by filling out the Free Application for Federal Student Aid (FAFSA) at your school or lender and signing the promissory note, which is a legal document promising to repay the loan.
For information on this type of loan write to Federal Student Aid Information Center, P.O. Box 84, Washington, D.C. 20044. Ask for a copy of the Direct Loans Repayment Book and other literature on student loans.
A third loan program is the Federal Parent Loan Program now available in many states. In some states this program is called the Parents' Loan for Undergraduate Students (PLUS). Under this program, it is possible for parents to borrow up to the cost of attendance minus any other financial aid. Annual interest rates vary up to 9 percent with 10 years maximum to repay the loan. Repayment of the loan must begin within 60 days after the money is received, and the minimum monthly payment on a $2,600 to $4,000 loan is $50. Further information on this program may be obtained by calling 1-800-4FEDAID (433-3243) or writing to Federal Student Aid Information Center, P.O. Box 84, Washington, D.C. 20044.
Work-Study Programs
In addition to the scholarships, grants, and loans described above, a student may obtain financial assistance through work-study programs financed by the university itself or by the federal government. The College Work Study Program is funded by the Department of Health and Human Services for the purpose of providing jobs for students who have extreme financial needs. To be eligible for this program, the student must be enrolled at least half-time in an approved institution. The particular job assignment for the student is arranged by the college and may be in campus laboratories, offices, libraries, or cafeterias. In some cases a university may place a student in a position off campus with a public or private nonprofit organization such as another school or a hospital. Students may be employed for as many as 40 hours per week and must receive salaries equivalent to the current minimum hourly wage. Information and applications for this assistance can be obtained from the financial officers of the individual schools.
Applying for Financial Aid
In trying to obtain financial assistance, the student and the student's parents must supply a considerable amount of information about their financial capabilities and needs. This information is usually supplied on a standard form. The Free Application for Federal Student Aid (FAFSA) is the most common form. Many schools, especially private colleges and universities, also require the student to fill out the College Scholarship Profile before they'll approve financial aid. In most cases, parents should submit the FAFSA or CSP providing actual income data as soon after Jan. 1 as possible. Some universities and colleges require students to submit the most recent year's federal income tax return for their family. The requirements for information will vary somewhat from one school to another and it is important for you to obtain exact requirements from the schools in which you are interested. It is important to remember that there are many sources of financial assistance available to prospective engineering students. Most colleges and universities have special scholarship programs and loan funds for students in selected programs. Many sources of financial aid often are overlooked. These sources include parents' employers, local clubs, fraternal organizations, veterans associations, youth groups, religious organizations, chambers of commerce, and other societies and organizations. Every effort should be made to investigate these possible sources of assistance. A student should seek help from a school counselor and from the financial aid officers at the schools he or she might like to attend. Many times students fail to receive scholarships or other forms of financial aid simply because they are unaware of the possibilities for such aid or because they apply too late.
Almost every university has a special financial aid office with responsibility for administering aid programs at that particular school. Usually it is a good idea for a student to obtain all the available information from the financial aid office as soon as the student becomes interested in that particular university. Then the student and his or her family can submit the parents' confidential statement, the statement of the student's own financial situation, or any other required information to the Financial Aid Office. All of these forms should be submitted at the earliest possible date in order to make sure that the student has ample opportunity to secure financial aid.
