Understanding the Difference Between Grants and Loans
April 30, 2015 governmentgrantresources.net Staff
The Federal government furnishes financial assistance in order to support a variety of goals, including the pursuit of higher education, health care, and job training. Grants and loans are two of the most useful forms of financial assistance supplied by the U.S. government. People often confuse these two assistance vehicles, but it is important to understand the distinction.
How Do Grants and Loans Differ?
Both loans and grants are awards of financial assistance, but there are some significant differences. While loans provide a personal benefit or individual assistance, grants are often given to groups or organizations, such as universities, state governments, non-profit groups, researchers, and law enforcement agencies. Grants may only be used to carry out government authorized purposes, and they do not have to be repaid. Loans, however, must be repaid, often with interest. Loans are frequently used for personal needs such as attending college, securing housing, starting a business, or obtaining disaster relief.
Where Can I Find Grants and Loans?
To search for grants, visit www.Grants.gov. This website will also lead you through the application process. If you’re seeking a loan, www.GovLoans.gov will help you find a program that suits your needs. Some assistance programs may provide non-cash benefits and include conditions and limitations.
How Can Benefits.gov Help?
To receive government assistance, you must meet the specific eligibility requirements of each individual program and complete an application. Benfits.Gov, the official benefits website of the U.S. government, supports you in your search for financial assistance. We connect people to assistance programs for which they may be eligible.
On our website, you can use our helpful Benefit Finder tool. Begin by completing a confidential eligibility questionnaire. Using your answers, we’ll automatically generate a list of benefits across twenty different categories of assistance. You may then review these suggestions and apply if eligible. If you have a specific need, you can also click on “Browse Benefits” to explore programs individually by state, Federal agency, or category.
What is a federal pell grant?
A Federal Pell Grant, unlike a loan, does not have to be repaid. Federal Pell Grants usually are awarded only to undergraduate students who have not earned a bachelor's or a professional degree. (In some cases, however, a student enrolled in a po...