In order to obtain a Federal Pell Grant, students must meet these specific requirements: be a U.S. citizen or an eligible non-citizen, receive his high school diploma or a GED, show the ability to do well in his program and demonstrate financial need.
The Federal Pell Grant was created to provide need-based financial assistance to low-income students. The U.S. Department of Education uses a distinct formula to estimate the financial needs of an applicant by using the data reported on her Free Application for Federal Student Aid (FAFSA) and his Expected Family Contribution (EFC).
The EFC formula takes students' income and assets (if they declare independent status) or their parents' income and assets (if they declare dependent status) into account, along with the number of their family members who are currently enrolled in college and the overall size of their household. "The EFC is the sum of: (1) a percentage of net income (remaining income after subtracting allowances for basic living expenses and taxes) and (2) a percentage of net assets (assets remaining after subtracting an asset protection allowance). Different assessment rates and allowances are used for dependent students, independent students without dependents, and independent students with dependents (ed.gov)."
The specific amount of a Federal Pell Grant tends to vary according to the year it's administered and the funding or monetary participation of the approved college or vocational program. Additionally, the amount of a student's Federal Pell Grant depends on the cost of attendance, Expected Family Contribution, enrollment status (full-time or part-time) and whether he attends for a full academic year or less (studentaid.ed.gov).
The approved post-secondary institutions are listed in the under the U.S. Department of Education's "Guide to U.S. Department of Education Programs." Participating institutions must credit the Federal Pell Grant funds directly into the student's school account, pay the student directly (usually by check) or do a combination of these methods. Under the guidelines, students must be paid at least once per term (semester, trimester or quarter); schools that do not use formally defined terms must pay the student at least twice per academic year (www.ed.gov).
Students must complete their FAFSA by the due date (which varies according to different schools and states, from March 1 to May 1, with June 30 as the deadline for federal aid) in order to be eligible for the Federal Pell Grant. After the FAFSA is processed by the U.S. Department of Education, a Student Aid Report (SAR) is sent to the student or an Institutional Student Information Record (ISIR) is sent to the school she's enrolling in. The SAR and ISIR inform the student of her eligibility for the Federal Pell Grant.