If you’re thinking about going to college, then one of the most important questions you’re undoubtedly asking yourself is “how am I going to pay for it?” Though there are more affordable options when it comes to higher education, it’s safe to say that there are virtually no cheap options. If you’re not immensely wealthy, figuring out the financial side of things can be tricky. When researching what kinds of financial aid are available to help you with your schooling, you may have came across scholarships and student loans. However, how is a student loan different from a scholarship?

How Is a Student Loan Different From a Scholarship?

Financial aid is categorized into three main classifications: scholarships, student loans, and grants. In order to differentiate between each of these, it will be helpful to define each of them separately and give examples of how they work. It’s important to note that, depending on your circumstances and school choice, one of these methods may be able to suffice or all three may still leave you needing to come up with the leftover cost on your own. Though there are many options available to help you afford your education, there is no one-size-fits-all solution to the problem of tuition, fees, and books.

Student Loans

Student loans are simply another type of loan. That means that some financial institution must be willing to pay for a certain amount of your schooling expenses up front and you will be left with the responsibility of paying it all back once you’ve graduated or stopped going to school.

The interest level is often high, meaning that you’ll have to pay whatever institution is involved much more money than they originally gave you to go to school. Likewise, you’re usually granted a six month grace period following your departure from college; that means you won’t have to start paying on your loans until half a year later.


Scholarships are different beasts entirely. The money that comes with a scholarship doesn’t have to be repaid; whoever provides the scholarship is solely reliable for the funds they promise. Scholarships are usually awarded because of the scholar’s performance in a certain field of study or even in sports.

Usually scholarships come with certain stipulations, meaning that if you aren’t able to meet the requirements proposed, your scholarship could be revoked and you’ll be left paying for whatever tuition, fees, books, or other expenses for the rest of your collegiate career either from your own pocket or from loans and grants.


There is also a third option that exists when it comes to financial aid: grants. Grants are monies simply given to you for tuition, fees, books, and living expenses with little to no strings attached. Usually you have to meet a certain amount of hours in order to receive them (above half-time, meaning 6 or more credits per semester), but they never have to be paid back and they won’t be revoked should your grades plummet. The government issues grants based on income, but there are other institutions who will award them to scholars pursuing degrees in specific fields of study.

Different Kinds of Student Loans and Scholarships

Though the main thrust of “how is a student loan different from a scholarship?” has been answered, there’s certainly more to the story. Both scholarships and student loans are broad categories in and of themselves; there are quite a few different types of each available, although they may not all be accessible to any one individual.

Federal and Private Loans

Academic and Sports Scholarships

Scholarships Based on Demographics and Area of Study

How to Get a Student Loan or Scholarship

Now that we’ve got the answer to “how is a student loan different from a scholarship?” and seen the different kinds that exist for each, the next step in the process is learning how to go about obtaining one or both of them. There isn’t a universal answer to this, however: every loan or scholarship you apply to will have different requirements and methods of application. Still, this should give you a good idea of how to go about receiving these two forms of financial aid.

Applying for Student Loans

Applying for Scholarships


So how is a student loan different from a scholarship? To put it simply, student loans must be repaid and scholarships do not. Scholarships are often awarded based on one’s performance in academics or sports, whereas student loans are offered even to those who may not be quite as talented in those areas. Furthermore, student loans may take income into consideration; while many scholarships may do the same, performance based scholarships often focus solely on the performance itself.

Now that you have the final answer to “how is a student loan different from a scholarship?” it’s time to make your decision on how to fund your collegiate journey and move forward into the world of higher education.

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