Scholarships

Free money is best! Money from scholarships is a favorite source of financial aid for most students because it does not have to be repaid. This form of aid is either based on your financial circumstances (need-based aid), or your academic, athletic, or artistic ability (non need-based aid). In some instances scholarships can also be awarded based on your background and interests.

Scholarships may be from public or private sources such as the school you attend. While most public aid is need-based, private aid can be either merit-based, need-based or a combination of the two.

Popular Scholarship Search Sites

Searching for Scholarships is 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 is the largest site with CollegeNet being another popular resource for finding scholarships. These sites ask you a few questions and then get 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!

Indiana Dollars for Scholars

Indiana Dollars for Scholars is a community-based scholarship foundation that offers scholarships to Indiana students. These scholarships have an application process that may involve writing an essay and being interviewed based on your essay. This program offers money for college and can also be a great learning experience.

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. If you believe the offer is a scam, report it. Sometimes an offer that is “too good to be true”, might be exactly that.

Scholarships that Never Materialize

Many scams encourage you to send them 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. These scams 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.

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. They 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@ismloans.org and we’ll be happy to answer or elaborate on an item that is confusing or unclear.