Purpose

• The Federal Pell Grant Program, or as students often call it "the Pell" is administered by the U.S. Department of Education and has been designed to provide low income students with access to higher education. As such, the grant amount and eligibility are determined based on the student's family income, asset levels as well as the cost of education at his or institution. Qualifying students can use the funds provided by the Pell Grant Program in around 5,400 institutions of higher education. The resources for the Pell Grant are appropriated by the U.S. Congress and the total amount available in Pell grants varies from year to year. For the 2010-2011 school year, Congress decided to leave the total funds for the program unchanged. The amount of aid available for the federal Pell Grant program is over $25 billion this year.
  
  

Eligibility

• Applicants to the Pell Grant Program must be actively enrolled or accepted for enrollment at a participating undergraduate or vocational program. The vast majority of higher learning institutions in the United States participate in the Pell Grant Program. Furthermore, only individuals who are not in default on an existing student loan and have satisfactory academic performance in school can apply for the Pell Grant. New students who do not yet have an academic record in a higher learning institution must maintain acceptable grade averages over the coming semesters to continue to receive the grant.
  
  

Financial Need

• The Pell Grant is awarded according to the student's financial need. The technical term for financial need is "Expected Family Contribution" or EFC. The formula for EFC is fairly complex and involves: net income, which is calculated after subtracting expenditures for basic living expenses and taxes from total income; net assets, calculated by subtracting the asset protection allowance from total assets; and the number of dependents. The EFC figure, arrived at by feeding these numbers into the model, will determine both the eligibility of the student and, if she is eligible, the amount of the grant.
  
  

Application

• Students apply for the Pell Grant by filing out the Free Application for Federal Student Aid or FAFSA. After the complete application is submitted to the school's financial aid office, the student will receive a Student Aid Report (SAR) and the school will receive an Institutional Student Information Record (ISIR) from the Department of Education. This report will detail if the student is eligible for a Federal Pell Grant and, if so, for what amount.
  
  

Repayment

• The Pell Grant is, as the name implies, a grant and you do not have to pay it back. However, if you qualify for the grant, receive payment in the form of a check and then do not enroll in the program you must pay back the grant.