Finding scholar dollars on the Web

By Paul Bannister • Bankrate.com

For just a few hours' effort, you could hit a big payday and collect thousands of dollars, just by applying for no-strings-attached, free scholarship money.

Endowment funds are waiting for everyone, and they're not tough to land. Just boot up your laptop and get online.

"In 2000, the last year for which U.S. Department of Education statistics are available, 6.9 percent of students, or one in 14, received private scholarships worth on average $2,050, says college planning author Mark Kantrowitz, publisher of the award-winning FinAid student financial aid Web site.

"That's between 600,000 and 700,000 scholarships. A great percentage of those successful students began their search for funds on our Web site, which is free to all users."

Very few scholarships go unclaimed, adds Baird Johnson, vice president for product and marketing at FastWeb, another leading, no-charge scholarship search service.

- advertisement -

"One of three college-bound high school seniors used our site last year," says Johnson. "We can search across the Internet for free. If you do not find the funds you want some other way, you can often get it through our database."

And those sites aren't the only ones on the Internet to use in a search for free money.

Personal finance expert Kathy Kristof wrote the book on finding cash for college. The author of "Taming the Tuition Tiger: Getting the Money to Graduate," says, "There is plenty of help on the Internet, and it's not too difficult to find. With some research you can get a good picture of what's available."

Kristof, a nationally-syndicated Los Angeles Times columnist, likes FastWeb and FinAid and also recommends these sites:

Collegeboard.com: "You can get details like estimated family contributions and see just how the college will view your application for funds.
Savingforcollege.com: "Provides excellent ratings so you can compare for yourself."
U.S. Department of Education: The department expects to provide some $67 billion in college financial assistance this year -- about 70 percent of all student aid. The Department of Education can also be reached toll free at 800 4-FEDAID.
Salliemae.com: Now being privatized, this SLM Corp., site provides federally-guaranteed student loans originated under the Federal Family Education Loan Program.

How the sites work
Fund administrators who are looking for applicants list their free money with agencies like those listed above. It costs them nothing; advertisers or government money funds the Web sites.

College-bound high-schoolers log on to the sites, usually for free, and specify their goals and qualifications.

The online matchmakers, who also help applicants find a college or a job, as well as turning up scholarship funds, put administrators and applicants together. After that, it's a marriage made in heaven. The would-be college kid gets funds to go to school, the college administrators improve the quality of their student body, and the university stays in business.

Sometimes, an organization will want a fee for its services. It can be legit, or it could be a scam. Investigate the organization before you hand over a cent. Talk to a financial aid adviser or guidance counselor before you pay anything -- you can often get similar help for free.

Federal Trade Commission officials warn that scholarship scammers often hold seminars at which they use high-pressure sales tactics to collect fees for their services. The scammers sometimes guarantee scholarships on a money-back deal, but attach impossible conditions to getting any refund.

If you opt to pay, get it all in writing. You want to know how much the service costs, what are the company's refund policies, and what will you get for your money. Some legitimate companies do charge for their services, but they never guarantee scholarships or grants.

Storm warnings
Be wary of lines like these:

"You can't get this information anywhere else."
"I need your credit card or bank account number to hold this scholarship."
"The scholarship is guaranteed, or your money back."
"We do all the work."
"You're a finalist" in a contest you never entered, or "You've been selected" to receive a scholarship. Remember, you must always apply for scholarships. They're not prizes.
"First come, first served." There are application deadlines, but scholarships are not awarded on a first-come basis.

If you have doubts, go to a counseling agency like College Parents of America, an advocate for the parents of present and future college students, or call toll free at 888-761-6702.

Now get out the laptop and start your own college-cash treasure hunt!

Paul Bannister is a freelance writer based in Oregon.