Types of Grants and Scholarships
How a scholarship is paid out to its recipient is largely dependent upon the type and source of the scholarship. Each individual, foundation or school that offers scholarship money has its own rules regarding the disbursement of funds. Government scholarships, known as Pell grants, are awarded based upon financial need. They differ from student loans, as they do not have to be repaid. Many universities, colleges and individual academic departments also offer scholarships to students, which may be based upon financial need, merit or both. Private organizations are one of the largest sources of scholarship money in the United States and give awards based upon their own criteria.
Pell Grants from the U.S. government may be used to cover school expenses including tuition, books and supplies, and are paid directly to the school for this purpose. However, any amount over and above the money owed to the school will be refunded to the student by check and may be used to cover living expenses such as room and board. Most financial aid offices issue these refunds within the first month of the semester. Pell grants, and refunds of money from said grants, are given out on a semester-by-semester basis.
Scholarships that are awarded by colleges themselves are generally paid directly to the school. In the event that this amount exceeds moneys owed to the school, the financial aid office issues refunds for the balance. Scholarships offered by private organizations and charities set their own regulations regarding scholarship funds, and many of them will issue a check for the full scholarship amount directly to the student to allow him to pay for any expenses associated with school, including living expenses such as room and board or daycare for dependent children. These scholarships may be given out for a semester, an entire school year or even a one-time award.