Does Financial Aid Have to Be Paid Back? Not all financial aid needs to be paid back. It depends on the types of financial aid you receive. For example, grants and scholarships normally do not need to be repaid. Also, any money that you earn through the Federal Work Study program does not need to be repaid. On the other hand, all financial aid that comes in the form of student loans will need to be repaid. Student loans are borrowed money that must be repaid, with interest, just like car loans and home mortgages. Student loans cannot be canceled because you did not get -- or did not like -- the education you paid for with the loans, did not get a job in your field of study or because you are having financial difficulty. Loans are legal obligations, so think about the amount you will have to repay before you take out a loan. The maximum Stafford Loan amount you can borrow each academic year depends on your academic level in school and whether you are a dependent or independent student. Students who demonstrate financial need are eligible for a subsidized Stafford Loan to cover some or all of that need. For students who are eligible for a subsidized Stafford Loan, the U.S. Department of Education pays the interest while you are in school at least half-time, for the first six months after you leave school (your grace period) and during a deferment (a postponement of loan payments). Unsubsidized Stafford Loans do not require a student to have financial need. The borrower is responsible for paying all interest on unsubsidized Stafford Loans. If you have a FFEL loan and need to find a participating lender, your school might have a list. This list is only a starting place when looking for financing. Check the terms and fine print carefully. Remember, if you are having difficulty repaying your student loans, you HAVE OPTIONS! You have the option to talk to your student loan servicer and adjust your monthly payments so that the payments are adjusted to your income. You might also be able to temporarily stop your monthly payments with a financial hardship deferment or forbearance. You may also wish to consider student loan consolidation. You may be eligible to combine your student loans into one new loan with a reduced monthly payment. Contact the organization that delivers your student loan coupons and statements for more information. Which Student Loan Is Best?