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There are many different types of financial aid for college. There are scholarships and grants, which do not have to be repaid. There are student loans that must be repaid following graduation from college. There are different types of student loans as well. There are federal student loans and private student loans. There are subsidized loans and unsubsidized loans. It may all be a little confusing for students who are preparing for college. Funds are applied to your individual college account in a specific order. Free money is applied first. Any scholarships or grants that you are awarded will be applied to your account first. Then, federal student loans are applied. Lastly, private student loans are applied. This enables you to return any portion of loan proceeds that you do not need. You should, however, keep in mind that there will be other college expenses aside from tuition and room and board. For example, you will have to buy books and other supplies. Some scholarships are automatically awarded to certain high school students based on their academic or athletic abilities. Other scholarships require that you apply for them. To get federal and state grants, you must apply. You also have to apply for federal and private student loans. That’s a lot of applications, right? Wrong! To apply for federal and state grants and federal student loans, you need to fill out only one application – the FAFSA or Free Application for Federal Student Aid. The grants and loans are need based, meaning that they are awarded to those who demonstrate a financial need for money to attend college. Unlike private student loans, federal aid is not credit-based. You do not have to have perfect credit in order to get a federal student loan.
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