Do Scholarships Need To Be Repaid?

If you are preparing to go to college or you are considering dropping out, you might be worried about your scholarships. Nowadays, just about anyone can get a scholarship or a grant to go to college. However, obtaining this money comes with certain obligations if anything unexpected happens.

Scholarships do not need to be repaid like student loans. However, if a student drops out or transfers from a college, their scholarship may become void or will need to be repaid. Scholarships can also be dependent on a student’s GPA, major, and even behavior.

Let’s take a closer look at what a scholarship is and what it is not.


A scholarship is a way for a business, a school, or any kind of organization to help contribute money to a student that is trying to obtain a degree. Scholarships can offer anywhere from a couple of hundred dollars to a couple thousand to a student that meets their specific requirements.

These scholarships allow different organizations to contribute to communities and universities, promote education, give aid to struggling students, and support different causes and ideas.

Most scholarships are awarded to students based on some form of merit. If a student performs well academically, there are dozens of organizations that are willing to help them through their higher education.

This is a phenomenal way for students that come from lower-income families to be able to go to college even if they cannot afford it themselves. Scholarships also reward and support promising athletes, musicians, or people with other desirable traits and qualities.

Students who are looking for scholarships can usually acquire several before they pay tuition. Some scholarships award a one-time sum of money that can go towards tuition, while others are renewable, contributing a sum every semester.

This money is usually sent to a school in order to pay for tuition, but sometimes it is given directly to the student to help them to cover their other expenses such as food or housing.

In order to make a scholarship come into effect, a scholarship contract is signed by both the student receiving the money and by the organization that will contribute the money. This contract specifies the amount of money that the organization will provide for the student and the responsibilities that the student will have.

A student’s responsibilities usually include taking a specified number of credits or courses each semester. It may also require a minimum GPA score that the student must maintain while studying, as well as the length of time that they will study at a given university.

This contract helps anyone receiving a contract to understand what is required of them. If you are obtaining a scholarship, read the requirements for the contract carefully and commit to keeping them. If you do not keep the requirements, your scholarship could become void, which may lead to some nasty consequences.

Losing Scholarships

If a student or other recipient of a scholarship fails to meet the requirements of their scholarship contract, their scholarship is at risk.

Whether or not you will simply lose the scholarship organization’s support or whether you will need to pay back the organization for the money that you already spent depends entirely upon the contract that you signed.

Read each contract carefully and keep track of the risks involved in spending your scholarship money.

There are many reasons that a scholarship could be lost. The most common thing that could put a student’s scholarship at stake is their GPA.

Scholarships that base their aid upon academic achievement will almost always require the students that they support to maintain the high level of academic achievement that got them the scholarship in the first place.

For most scholarships, this means maintaining a GPA over 3.0, though some scholarships may demand higher scores.

Another common way to lose a scholarship is by failing to take the necessary number of credits each semester. If organizations that offered large renewable scholarships did not require students to take a set number of credits every semester, students could stay in college for years, supported by their scholarships.

Make sure that your course load is sufficient every semester to keep you in the green, and avoid withdrawing from classes that are keeping you above the minimum limit.

Scholarships can also be lost if a student switches majors or if they change the college that they are attending. Scholarship contracts sometimes stipulate that the student must attend a specific school or that they study in a specific field.

This is especially common with scholarships that come from organizations trying to promote the study of topics like nutrition or agriculture.

Thankfully, a scholarship that may be lost in this way can usually be replaced by a similar scholarship that supports you in your new major or college.

Similarly, your scholarships will be lost if you drop out of college. After all, it doesn’t make sense for an organization to spend money on the tuition of a student that isn’t going to school anymore.

In almost all cases, the money must be returned to the provider. In some rare cases, like when a student drops out because of extraordinary conditions like a serious personal injury or the death of a family member, the scholarship can be maintained and the money will not need to be returned.

Many scholarships and other forms of financial aid bring with them an expectation of good behavior. Organizations that offer scholarships want to promote students that are obedient to certain standards and policies. If a student has problems with university campus authorities or engages in activities like alcohol consumption, they could be at risk of losing their scholarship.

Any form of academic dishonesty will also put everything at risk for a student.

Another form of dishonesty that can cost a student their scholarships and perhaps even force them to repay them is the dishonest use of the money that they are given. If a student stockpiles money that is given to them to pay for tuition, or if they spend the money on things that the scholarship providers did not intend, they could lose the scholarship.

Most scholarship contracts stipulate the uses that the money can be put to, so check carefully before you spend, even if it is for something academic.

Finally, scholarships are lost from simply forgetting to renew them.

Many renewable scholarships will stipulate the terms of renewal and the date by which the contract must be renewed. As long as you are keeping up with the requirements for your scholarship, you should have no problem moving forward with your studies each semester, as costly as they may be. If scholarships fail to pay for your tuition and other expenses, there are always a few more options available to you.

Study Grants

A governmental study grant (commonly known as Pell Grant) is a potential source of money available to low-income students. This grant comes from the government of the United States and is available at a variety of institutions. Because of its accessibility and size, a Pell Grant is generally considered to be the foundation of financial aid for a student.

Pell Grants offer students that have a low income and few resources a significant amount of money, depending on the student’s needs. Grant sums can reach up to over six thousand dollars, which can be a lifesaver for students without funds.

Furthermore, because Pell grants are not based upon the merit of a student (like most scholarships are), Pell grants are open to a wider number of applicants.

The money given to a student from a Pell grant does not need to be repaid like a student loan would. As long as a student passes the approval process (including filling out a FAFSA document) their school will be able to access the grant money and apply it to their tuition.

Once tuition has been paid, the extra money can be put towards room and board or even other expenses, like textbooks.

For these reasons, one of the first things that a college applicant should do is apply for a Pell grant. The sooner that the FAFSA application is submitted, the greater chance that the student will receive assistance from the grant.

If your financial needs are exceptionally large, you might qualify for the Federal Supplemental Educational Opportunity Grant, which allocates additional funds to students without any means.

Student Loans

If your schooling expenses cannot be covered by the combination of a Pell grant, scholarships, a part-time job, and family assistance, students have the option to take out a student loan. Student loans are a little different from other loans, as they often have lower interest rates than traditional loans, and they may not start to charge interest until the student graduates.

Because most scholarship providers and government grants do not usually cover things like graduate programs, student loans are often the only way for students to pay for higher education.

Institutions can afford to give these favorable deals to students because there is a low risk of a student failing to pay off his or her loan. Students that graduate from college will on average have higher incomes, and they will be in a place where they can pay off loans reliably.

In addition to the low risk of students as borrowers, many organizations which offer student loans are federally subsidized, bringing down their costs and their risk. Thanks to these government subsidies, student loans are broadly available and are not too crippling for people who are trying to get an education.

Unlike scholarship or grant money, however, the money borrowed on a student loan must be repaid. Depending on the cost of a person’s schooling, the amount owed on student loans can be substantial. If accounts and amounts are not carefully tracked and kept up on, these loans can quickly get out of hand.

In order to help students relieve their student loan debts, many of the federal student loans that are offered to students have ways by which the loans could be forgiven.

For example, if a student goes to school and then works for a nonprofit company, their loans can be forgiven after they make 120 payments on their loans. This clause can also apply if the student goes on to work for the government in some capacity.

In addition to student loan forgiveness, the government has a few other programs that can help college graduates to manage their student loan debt.

One of these methods includes Income-Based Repayment, a program by which students can have their federal loans reduced depending on their income and not the amount that they borrowed.

Paying for School

No matter what your financial situation might be, there are a variety of ways that anyone could attend college and get a higher level of education. If you are planning on attending college, you should focus on obtaining a Pell grant and as many merit scholarships that you can.

By working hard in high school to maintain a high GPA, you can secure a substantial amount of financial aid for yourself during your years in college.

While in college, maintain a high GPA and keep the terms of the various scholarship contracts that you have. In order to avoid student loans (and to be sure that you qualify for all forms of financial aid), you. might consider getting a part-time job working on your college campus.

These jobs are available to all students on almost every campus, and they often come with deals on your housing or tuition. The extra income should be enough to keep you afloat.

If a student needs another source of income while they are at school, they can usually donate plasma. Many college towns have plasma donation centers near campus, where they will pay students as much as $100 per week to donate plasma twice.

Unlike donating blood, which leaves you drained, donating plasma simply requires the donor to stay hydrated and in shape. If you need just a little more income. for groceries or textbooks, this could be the perfect move.

As long as you work hard and are aware of your financial situation, you should be able to get through your time in college without collecting significant debts. Always keep in mind the contracts that you have signed and the agreements that you have made, and you will get the education that you desire.

Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily represent those of the College Reality Check.

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