Finding Scholarships
Free money is best and that’s why finding scholarships is so important! If you maximize your grant money and spend some time finding scholarships you will be on your way to the least amount of post college debt possible. This form of aid is often based on your financial circumstances (need-based aid), or your academic, athletic, or artistic ability (non need-based aid). Scholarships can also be awarded based on your background and interests and are from public or private sources such as the school you attend.
Popular Scholarship Search Sites
Here is some great news. Searching for scholarships is MUCH easier now than ever before! Many websites let you apply online and are dedicated to helping you find a scholarship that you qualify for. FASTWEB and CollegeNet are just two popular places for finding scholarships. These sites ask you a few questions and then show you a list of scholarships you qualify for. Billions of dollars of aid are available here.
Websites like these also allow you to search their database to find any number of scholarships you might qualify for. Another useful way to find scholarships is to discuss them with the college or university you plan to attend. The Financial Aid office at your school will know about scholarships you may be eligible for just by attending that particular school or by majoring in a certain field. When it comes to scholarships, it never hurts to ask!
You can also use our Scholarship Search Help Sheet. It presents a helpful list of resources and tips, while listing additional places to ask about scholarship offerings.
Common Scholarship Scams
While scholarships are extremely helpful to funding college wisely, avoiding scams is important during your search. Some of the most common types of scholarship scams are presented here. If you receive an offer that uses one of these tactics, be suspicious. Often an offer that is “too good to be true” is exactly that.
Scholarships that Never Materialize
Many scams involve a request for money up front but provide little or nothing in exchange. Usually victims write off the expense, thinking that they simply did not win the scholarship. Money needed up front is a red flag at the very least.
Scholarships for Profit
This scam looks just like a real scholarship program, but requires an application fee. The typical scam receives 5,000 to 10,000 applications and charges fees of $5 to $35. They can afford to pay out a $1,000 scholarship or two and still pocket a hefty profit – if they happen to award any scholarships at all. Once again, money up front is a red flag.
The Advance-Fee Loan
This scam offers you an unusually low-interest educational loan, with the requirement that you pay a fee before you receive the loan. When you pay the money, the promised loan never materializes. Federal education loans deduct any fees from the disbursement check and never require an up-front fee when you submit the application. If the loan is not issued by a bank or other recognized lender, it is probably a scam.
The Scholarship Prize
This scam tells you that you have won a college scholarship worth thousands of dollars, but requires that you pay a “disbursement” or “redemption” fee or the taxes before they can release your prize. If someone says you have won a prize and you do not remember entering the contest or submitting an application, be suspicious.
The Guaranteed Scholarship Search Service
Beware of scholarship matching services that guarantee you will win a scholarship or they will refund your money. They may simply pocket your money and disappear, or if they do send you a report of matching scholarships, you will find it extremely difficult to qualify for a refund.
Investment Required for Federal Loans
Insurance companies and brokerage firms sometimes offer free financial aid seminars that are actually sales pitches for insurance, annuity and investment products. When a sales pitch implies that purchasing such a product is a prerequisite to receiving federal student aid it violates federal regulations and state insurance laws.
Free Seminar
You may receive a letter advertising a free financial aid seminar or “interviews” for financial assistance. Sometimes the seminars do provide some useful information but often they are cleverly disguised sales pitches for financial aid consulting services (e.g., maximize your eligibility for financial aid), investment products, scholarship matching services and overpriced student loans. Checking with the financial aid office at the college you will be attending for their thoughts on such an event might be a good idea.
Always remember if you have a question about anything on this site, feel free to drop us a note at outreach@ismcollegeplanning.org and we’ll be happy to answer or elaborate on an item that is confusing or unclear.