Federal Pell Grants
About 2/3 of all student financial aid comes from various types of federal financial aid sources. One of the better known forms of financial aid programs is the Federal Pell Grant. Federal Bell Grants are unique in that they do not need to be repaid. Pell Grants are typically given only to students that are pursuing an undegraduate degree. One of the few exceptions to this is you may be eligible if you are applying to a graduate teacher certificate program.
Eligibility for a Pell Grant is determined based on your "Expected Family Contribution" (EFC). This is a calculation of how much money the government believes your family is able to pay. To find out what your EFC is, you need to begin the application process by submitting a FAFSA form. About 6 weeks after you submit this form (or 2-3 weeks if you submit it by the web) you will get a "Student Aid Report" that will show you your eligibility.
The size of Pell Grants depends on the currently approved funding for the program. For the 2003-2004 academic year, the maximum award was $4050. Other factos affecting the size of your possible grant are the cost of attending the school, whether or not you are full or part time, and whether or not you are going for the full year. You may not receive more than one grant per year, or from more than one school at a time.
Federal Pell Grants are received through the school. Payments can be credited against your tuition bill, by paying you, or a combination of both. Once you have been awareded a Pell Grant, the school must notify you in writing of the amount, and how payment will be managed.
Pell Grants are an extremely useful supplement to a financial aid program. As they don't need to be repaid, they can play a key role in lowering the burden you face after completing your education, when other types of financial aid needs to be repaid. Note that each school will receive enough money from the federal government to cover the Pell Grant awards to all eligible students. This is not the call with all federal financial aid programs.
Source: The Student Guide, published by the US Department of Education. Note that federal financial aid programs are subject to change. Check with the school(s) of your choice to get the very latest information.