Financial aid is intended to help students who lack the financial means to pay for college. It is not meant to reward students for their achievements or encourage them to pursue higher education, although it may have those effects.

Loans are not considered financial aid because they must be repaid. Grants, scholarships, and work-study do not have to be repaid.

Grants are awarded to students who demonstrate financial need, while scholarships are awarded to students who have demonstrated academic achievement or other special talents.

The maximum amount of federal student loans that an undergraduate student can borrow each year is $12,500.

The interest rate on federal student loans is 4.5%.

The repayment period for federal student loans is 10 years.

The grace period for federal student loans is 6 months.

Subsidized federal student loans do not have to be repaid until after the student graduates, while unsubsidized loans must be repaid while the student is still in school.

The maximum amount of federal student loans that a graduate student can borrow each year is $20,500.

The interest rate on federal student loans for graduate students is 6.5%.

The repayment period for federal student loans for graduate students is 10 years.

The grace period for federal student loans for graduate students is 6 months.

PLUS loans are available to parents of undergraduate students, while Stafford loans are available to undergraduate students.

The maximum amount of a PLUS loan that a parent can borrow each year is $12,500.

The interest rate on PLUS loans is 7.5%.

The repayment period for PLUS loans is 10 years.

The grace period for PLUS loans is 6 months.