Financial Aid For Online Colleges

Online Colleges That Accept Financial Aid

Many students turn to online learning for its affordability. However, online learners may still need help paying for their education. Financial aid for online colleges can help students fund their degree. Some options include scholarships, grants, and loans.

Online learners can start the financial aid process by exploring online colleges that accept FAFSA results. The federal government, states, colleges, and many other private institutions use the FAFSA to determine a student's financial aid eligibility.

This page outlines the different types of financial aid for online colleges.

Financial Benefits of Online College

Many online colleges offer an affordable path to a degree. Learners benefit from flexible scheduling and no commute. Online students may also pay the cheapest tuition. Read below for three financial benefits of online college.

How to Make Online College Affordable

Finding financial aid for online colleges involves many steps. The federal government provides the American Opportunity Tax Credit and the Lifetime Learning Credit. As of October 2021, these credits lower learners' federal tax bills by up to $2,000 annually. Students must enroll in an approved program. They must also make less than the programs' income cutoffs.

Learners should regularly look for scholarships. Many scholarships appeal to returning students. Some accept only junior or senior applicants. Students can explore online scholarship databases for the latest opportunities. Schools' financial aid offices can also provide scholarship information.

High school students can make college more affordable by taking Advanced Placement (AP) exams. Strong AP scores help learners skip introductory courses and graduate sooner. Students who take AP exams also prepare for college's academic rigor.

Some colleges accept AP scores in place of first-year courses. Exams and policies differ by school. Students should review rules and regulations closely.

Learners can save money in many ways during college. They can buy used textbooks and research free online learning resources. Some services also rent textbooks. Small actions can help students save thousands of dollars while earning their degrees.

Are Online Colleges Accredited?

The accreditation process ensures that colleges provide on-campus and online learners with an excellent education. The U.S. Department of Education charters regional accreditation agencies to evaluate schools. Reputable schools earn accreditation. Learners attending an unaccredited school may not qualify for financial aid for online colleges, including federal grants and loans.

Some online colleges are also nationally accredited. The Distance Education Accrediting Commission (DEAC) compares schools' online and on-campus programs. The DEAC evaluates educational quality. The commission also examines schools' business practices and ethical standards. DEAC-accredited schools complete regular renewals.

Some programs feature programmatic accreditation. Private programmatic accreditation agencies hire industry experts to determine how well a program prepares students for a career. The Council for Higher Education Accreditation lists the top programmatic accreditation agencies.

Types of Financial Aid for Online Classes

Learners exploring financial aid for online colleges can research many options. These include federal and state aid, scholarships, loans, and employer assistance. Eligibility requirements vary. Applicants should review renewal requirements and deadlines. Students can also work with their school's financial aid advisors to find the best aid programs.

• Federal Aid

  The federal government provides grants and loans to students with financial need. Federal grants do not require repayment. However, recipients must remain in good academic standing. For example, Federal Pell Grants have a maximum award amount for the 2021-22 academic year and may award up to $6,495.

  Learners can also use federal loans to pay for college. Subsidized loans do not incur interest until students graduate.

• State Aid

  Like the federal government, states offer grants and loans. In addition, states may use lottery revenue to fund merit-based scholarships or provide learners with tuition-free community college. Eligibility requirements vary by state.

• Scholarships

  Colleges and private institutions award scholarships. Scholarship committees consider applicants' GPAs and extracurricular activities. Deadlines and application materials vary by scholarship. Recipients do not pay the money back as long as they make adequate academic progress. Additional rules may apply depending on the award.

• Loans

  Private lenders that include banks offer student loans. Unlike some federal loans, private loans incur interest before learners graduate. These loans may also feature a higher interest rate. Noncitizens ineligible for federal loans can turn to private loans to get the money they need to pay for educational expenses. Loans can negatively impact learners' financial health. Students should use them as a last resort.

• Employer Assistance

  Many employers offer tuition-reimbursement programs for employees. Eligibility requirements may include financial need. Students may need to major in an approved subject. In return for aid, recipients may need to agree to stay with their employer for a specific number of years after graduation. Employees who leave before this date pay back some or all of the tuition assistance.

Completing the FAFSA for Online School

Qualifying for financial aid for online colleges begins with completing the FAFSA. The process determines students' financial aid eligibility. Learners must submit financial information by the federal application deadline each year. However, many states and colleges maintain priority deadlines. Students should submit the FAFSA form before these deadlines to be considered for aid programs they may offer. Learners can explore many online resources to help with the process.

• Eligibility

  The FAFSA is open to American citizens and permanent residents. Financial aid recipients maintain eligibility by making satisfactory academic progress (SAP). Each college classifies SAP differently. Some schools use a GPA cutoff. Other schools require students to take a minimum number of credits each semester.

  Learners must submit the FAFSA each year. Students or their guardians provide current financial information. This data affects aid amounts.

• Application

  The FAFSA website explains the application process. Students can also read answers to typical questions. Learners start by registering and receiving a unique FSA ID. They use their FSA ID each time they access their account.

  Dependent students report their parents' financial information. They submit W-2s, income tax records, and other relevant statements. Applicants should also know their Social Security number or Alien Registration number.

• Deadlines

  The FAFSA application opens annually on Oct. 1. For the 2021-22 academic year, students must submit the FAFSA by June 30, 2022. For the 2022-23 academic year, students must submit the FAFSA by June 30, 2023. Many learners submit the FAFSA well before the deadline. This is because states set unique deadlines for their financial aid programs. The FAFSA website lists state deadlines.

  Students should check when their school requires the FAFSA for institutional financial aid. This date may differ from the federal and state deadline. Learners can contact their school's financial aid department for information.

• Submission

  Learners who submit the FAFSA online receive a student aid report (SAR) within 3-5 days. The SAR includes how much a student's family may contribute toward college expenses annually. This is the expected family contribution (EFC). Students whose cost of attendance exceeds their EFC may qualify for federal, state, and institutional financial aid. Some colleges ask for financial documents in addition to the SAR before awarding need-based aid.

  Some students find mistakes in their SAR. They can make corrections on their online account.

Additonal Resources on How to Make College Cheaper

Reviewed by:

Mary Louis

Mary Louis is a Brooklyn native who currently resides in Nashville, where she works at a state community college. She has worked in financial aid and recruitment as a registrar and bursar at city, state, for-profit, and Ivy League institutions, as well as at HBCUs.

Mary Louis is a paid member of the Red Ventures Education freelance review network.