Borrowing to pay for some college costs is a reality for the majority of students. For those students and their families researching for the best types of loan and financial aid for students can help ensure responsible borrowing for studies.

As students and parents review financial aid notifications from different colleges, it’s good to know the difference types of loan and financial aid for students.

If borrowing to cover expenses is necessary, the types of loan and financial aid for students is the federal subsidized and unsubsidized loans, which are included in financial aid notifications. These loans, which are offered by the federal government, typically have better rates, repayment assistance and protections than other types of loans, including other types of federal loans. Before applying for a student loan, students and parents should know the types of loan and financial aid for students that are right for them.

Types of Loan and Financial Aid for Students

• Grants

Grants are types of loan and financial aid for students that are usually offered to eligible students with financial need or those with other special circumstances. Grants typically come from federal and state governments and agencies or from colleges; some are guaranteed to students who meet minimum qualifications. Some grants are offered by private entities and other organizations.

Grants do not need to be repaid. Some are offered only for freshman year; others are renewable for four or more years if the student continues to meet the qualifications.

• Scholarships

Scholarships are similar to grants in many ways. A student may receive a scholarship for demonstrating financial need, but scholarships are also awarded for academic merit, specific accomplishments and a variety of other qualifications. Colleges are the source of many of the most substantial scholarships, but community organizations, nonprofits and businesses also make awards.

Scholarships also do not need to be repaid. Some are one-time awards; others are renewable if the student continues to meet qualifications. Students who qualify for renewable academic scholarships from schools should especially be aware of the requirements to continue receiving the award and if they can requalify later if they temporarily fall below minimum guidelines. Apply for Scholarships.

• Work-Study

Work-study is a federal aid program offered by schools to eligible students with financial need. Estimated wages for jobs on or near campus are included in the college’s financial aid offer, and colleges often provide assistance in locating these positions.

The work-study offer is a projected amount based on the student working a set number of hours, and the student is expected to use earnings to offset college expenses. Students who receive work-study should consider their ability to work the established hours, the pay compared to non-work-study positions and the work-study jobs available to them. Most schools that offer work-study have job boards listing available positions.

• Savings and Earnings

Although not technically offered as part of a financial aid package, students are often expected to provide some funds to pay for the cost of college, either from existing savings or from continued earnings during college.

Students who aren’t offered enough other aid to cover the cost of attendance may plan to work to earn at least part of the shortfall. Again, students should be aware of the jobs available to them during school terms and breaks and an expected wage. Sometimes, on-campus jobs are limited to those who are eligible for work-study and other students may need to look further afield.

• Student Loans

Federal student loans are included in a student’s financial aid offered to student. These loans need to be repaid but do not require payment until the student has left school. Students are guaranteed a certain amount of federal student loans, and parents may supplement that amount by taking out federal parent loans for the student’s benefit. (Parent loans enter repayment immediately, but borrowers may be able to delay payments if they meet certain criteria.)

• Private Student Loans

Private student loans can be obtained from private lenders if students, or their cosigners if required, meet minimum underwriting criteria. Some colleges also lend student funds through their own programs.

Students who take out student loans should consider their ability to repay the total amount they’ll need to borrow for their entire college career. A general rule of thumb is to not borrow more in total than the student can realistically expect to make in his or her first year after leaving college.