Need-based grants are awarded based on demonstrated financial need and, like scholarships, do not have to be repaid. While many need-based grants are available through government programs, they are not the same as government loans. Fundamentally, college grant definitions set them apart from monetary loans, however, some grants do come with terms that, once violated, can convert the grant to a loan. For example, if the educational program is not completed or the student does not remain enrolled for duration of time specified in the grant, they may be required to repay some or all of the grant amount. Need-based grants are also available from nonprofit organizations and other private funding sources.

The amount of funding awarded through a need-based grant program can vary depending on a number of factors. Award amounts may be affected by the amount of funds available to the program, which can fluctuate from year to year, as well as a student's documented, unmet financial need and income status. Awards may range from $1,000 or less to a full tuition grant, depending on the cost of an education at the institution in question. Need-based grants are available for almost every level of study, from vocational school to graduate programs.

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Benefits of an Online Degree

The benefits of earning a degree online can be life-changing, especially for low-income students. Recent studies cite numerous advantages for online students in academia today, with more than three million students enrolled in fully online programs and six million taking at least one class online. Many students who continue to seek out online degrees over traditional programs can enjoy a wider variety of courses, improved communication skills, and greater convenience and flexibility, not to mention a significant savings on tuition and other costs. Online programs are generally less expensive than those completed on campus, and typically offer much of the same need-based financial aid that is available to traditional students. Many employers prefer candidates who are graduates of an online program for their enhanced practical job skills, and some may even provide financial assistance to qualifying students for job-related coursework. Need-based financial aid is also widely available to veterans, working adults, single parents, minorities, and other groups who stand to benefit from enrolling in an online program.

Grants vs. Loans

Of the several notable differences between grants and loans, the most significant concerns the repayment obligations for the two types of awards. A college grant by definition does not have to be repaid, while a loan does require repayment. Need-based financial aid in the form of need-based scholarships and grants is also typically exempt from accumulating interest or fees, while loans do include additional costs, as determined by the issuer of the loan and the terms of the agreement. Grants always require a FAFSA application for eligibility, and are open only to U.S. residents, while these particular requirements vary and may be more flexible for loan-seekers. Both grants and loans include a limit on the amount of money a student can receive per award.

Eligibility Requirements

The eligibility requirements for need-based grants are primarily focused on a student's financial situation and the amount of funding they receive for college. Applying for a need-based grant begins with submitting the Free Application for Federal Student Aid(FAFSA), if the grant is government-funded. Privately funded grants have other income verification requirements, which may or may not depend on FAFSA application status. Some grants disqualify students who are also receiving funding from other sources, are over a set income threshold, or who already have a college degree. Additionally, students must be a U.S. citizen or legal resident to be eligible for most need-based college grants. Perhaps the most well-known need-based grant, the Federal Pell Grant, can award up to $5,500 per academic year.

Types of Need-Based Grants

Babson Grant

Though selective, Massachusetts' Babson College offers this grant to low-income students with financial need. The grant is awarded for four years.

Colorado Student Grant

By demonstrating financial need via the FAFSA, Colorado State University undergraduate and graduate students who are Colorado residents are eligible for this award.

Federal Pell Grant

Pell Grants are federal grants open to students pursuing a first bachelor's degree, though they may also be awarded to students pursuing a post-baccalaureate teacher certification program. Pell Grant award amounts vary from year to year.

Federal Supplemental Educational Opportunity Grant (FSEOG)

The FSEOG is a grant for students who have received Pell Grants but who still need additional financial aid in order to attend a first baccalaureate program. The amount of money awarded depends upon the financial need of each individual applicant, and offers a maximum of $4,000 per year.

Georgetown Law Need-Based Grant Assistance

These tuition grants at Georgetown Law School are offered to full-time Juris Doctor (J.D.) students who qualify to receive federal financial aid.

ISU Academic Need-Based Grant

All incoming freshmen at Indiana State University are automatically considered for this grant, renewable for three years. Selection depends on having at least a 2.75 GPA and being Pell Grant eligible.

Kansas Comprehensive Grant

Awards run from as little as $50 annually to $1,500, depending on funding levels. Priority is given to Kansas residents who meet the priority FAFSA filing date of March 1.

Kenyon College Need-Based Grant

This private liberal arts college awards need-based grants to qualifying students each year, determined by the FAFSA form. Students who receive an award must reapply annually.

Louisiana Go Grant

The Go Grant serves low-income and non-traditional college students in the state of Louisiana who take at least six credits in an eligible institution in the state.

Minnesota State Grant

Though the average award amount is $1,800 per year, this grant awards varying amounts to students at both public and private two-year and four-year state schools who are from family incomes below $20,000.

Nevada Bureau of Indian Affairs Grant

Nevada residents who can verify Indian ancestry and who have exceptional financial need are eligible for this grant offered by the University of Nevada, Las Vegas.

Ohio College Opportunity Grant

This grant offers awards to students who are Ohio residents pursuing an associate's degree, first bachelor's degree, or nurse diploma at an eligible Ohio or Pennsylvania institution, Students must also have an EFC (Expected Family Contribution) of 2190 or less and a household income of no more than $75,000.

Perkins School of Theology Need-Based Grant

Students at Southern Methodist University's Perkins School of Theology can apply for a number of need-based grants through the university, available to both part-time and full-time students in varying amounts.

S.C. Need-based Grant

The South Carolina Commission on Higher Education offers this need-based grant to both part-time and full-time students who are South Carolina residents.


The TEXAS Grant is a government funded grant program for undergraduate students with financial need who are attending a public community college or university in the state of Texas.

University of North Carolina Need-Based Grant

UNC students at any one of the school's 16 campuses who are enrolled in at least six credit hours are eligible for this grant.