How Dental School Financial Aid Works

Any type of financial aid that doesn't require repayment is called gift aid. Students who receive gift aid may put the money toward their expenses without the obligation to pay that money back. Gift aid most often takes the forms of grants and scholarships.

Both grants and scholarships can come from public or private sources. Public sources are funded by taxes. Private aid may come from individuals, estates or organizations. There are literally hundreds of different grants and scholarships available to students.

The first step to securing gift aid is research. Some gift aid is based upon student needs. The amount of aid a student receives is determined by how much money the student can provide toward his or her own education. We call this amount the expected family contribution (EFC).

Your EFC is an assessment of how much money you and your family can contribute to your education. Before applying for any type of financial aid, most colleges and organizations require students to fill out the Free Application for Federal Student Aid (FAFSA). The FAFSA gathers financial information that the federal government uses to determine how much money the family can contribute to the student's education without causing an unreasonable financial burden.

In general, before a student can receive need-based financial aid, the source of the financial aid will subtract the student's EFC from the cost of education. Students who can cover most or all of their educational costs aren't eligible for need-based financial aid. Each need-based scholarship or grant has its own definition of what constitutes eligibility.

Some gift aid is merit-based. Students may receive merit-based aid if they meet specific academic performance standards or demonstrate certain talents -- each merit-based scholarship has its own requirements. Like need-based aid, students don't have to repay money they receive from merit-based scholarships. There's a limited amount of merit-based financial aid available, which means competition for funds can be fierce.

Overall, there's very little gift aid available for graduate students. There are a few resources set aside specifically for students entering dental school, but these resources are limited and there are many students competing for them. Plus, the scholarships and grants that are available may help with some of the cost but most students will need to seek additional help in the form of student loans.

Unlike gift aid, students must repay money they receive as part of a student loan. They'll also have to pay interest on top of the full amount of money they borrowed for school. Some loans give students a grace period during which they aren't required to make payments. Often, this period will extend through the students' time at school. Some loans freeze interest during this period as well.

Before you begin the application process, assess how much of your costs your own resources will cover. Because you'll have to repay loans with interest, it's important to borrow only as much as you need to cover costs. There are federal loans with fixed interest rates that can help. Most of these loans have a maximum cap; however, if your expenses are still too high for you to cover with your own resources and federal loan money, you'll need to seek out an institutional loan.

Institutional loans come from private financial institutions. These loans often have higher interest rates and may require the student to send in payments earlier than federal loans. Students should seek out other forms of financial aid before applying for an institutional loan.

Most schools have a financial aid office that can direct you to some of the loans and resources available to students in your area. Some schools even offer additional financial aid programs such as work study programs. And some scholarships are unique to specific schools. So, as you can see, by doing your research early and making a realistic budget, you can avoid some of the stress of financing your education.

For more about financial aid and other related topics, drill into the links on the next page.