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Financial Aid in Distance Education: Overview of Options

While not all distance education courses and programs come with financial aid opportunities, many of them have the same eligibility as on-campus options.

Distance education students can find loans and scholarships through the federal government and through individual colleges. To be eligible, they must meet certain requirements and fill out specialized forms.

Financial Aid Options in Distance Education

Among the types of financial aid available to distance education students are federal grants and loans. Grants do not have to be repaid by students, while loans do. Through federal loan programs, students can borrow money directly from the government at a low interest rate.

Federal Aid Programs

Federal grant programs include:

  • Federal Pell Grant
  • Federal Supplemental Educational Opportunity Grant (FSEOG)
  • Academic Competitiveness Grant (ACG)
  • Direct Stafford Loan
  • William D. Ford Federal Direct Loan
  • Federal Perkins Loan

School-Sponsored Financial Aid

Colleges may also individually provide financial aid for students based on financial need and/ or student achievement. These include:

  • Institutional grants
  • Merit awards
  • Merit scholarships
  • Student loans

Financial Aid Eligibility

The type of program a student enrolls in is just one of many factors that must be considered when determining eligibility for financial aid.

Student Status

Distance education students must be enrolled in associate's, bachelor's, master's or doctoral degree programs to receive federal grants. Students enrolled in programs leading to a certificate, diploma or similar credential are only eligible to receive federal loans. Students must also be enrolled in a school accredited by a U.S. Department of Education-recognized accreditation agency.

Schools offering distance education scholarships or awards may require students to have completed one or more courses towards their degree programs. However, some schools may grant scholarships to students who are enrolled in non-degree continuing education or certificate programs.

Other Eligibility Criteria

Eligible students must be able to demonstrate financial need and must be U.S. citizens with a valid Social Security number. However, eligible non-citizens may also receive financial aid. Male students must be registered with Selective Service. All students are required to have a high school diploma or equivalent GED. Students receiving federal student aid who are convicted of a drug offense may lose their eligibility. This eligibility may be renewed under certain conditions if a student completes an acceptable drug rehabilitation plan.

Students receiving scholarships, merit awards or grants from a college or university may be subject to a school's own eligibility requirements. These vary by award, but can include requirements based on age, enrollment status or field of study. For example, some awards are designated for older students, veterans or those interested in a specific field of study, such as adult or special education.

About the FAFSA

The Free Application for Federal Student Aid (FAFSA) is the standard form used to apply for federal grants and loans. State university systems and private colleges also use this form to award financial aid in the form of grants, scholarships or merit awards. All students will need to reference the following documents:

  • Social security number
  • Driver's license, if applicable
  • W-2 forms and records of any income
  • Most recent federal income tax return
  • Record of any untaxed income
  • Bank statements
  • Investment portfolio, if applicable
  • Alien resident card, if applicable

Calculating Financial Need

The information on the FAFSA is used to calculate financial need, which determines the amount of aid for which a student is eligible. Financial need is determined by calculating the difference between the expected family contribution and the cost of attendance for a particular educational program. Expected family contribution is based on financial information like the student's income, as well as the income of their parents if the student is a dependent. For distance education students, cost of attendance can include expenses for:

  • Tuition
  • Fees
  • Books
  • Supplies
  • Loan fees
  • Dependent care
  • Computer technology

The federal government provides various loan options for distance education students. Students may also qualify for school-based financial aid.

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