Will previous debt to any school affect my Pell grant eligibility in any way?

The Pell Grant is given by the government to provide financial aid to low-income students who are otherwise unable to pay for their education, either for their undergraduate degrees or certain postbaccalaureate programs that can be certified. While there are only certain schools that are participating, there are at least 54,000 of these, so students who have been given a Pell grant have a variety of options for where they can study.

The reason why a lot of students are vying for a Pell grant is that the money given to them need not be repaid. The money is freely given to them so that they will be able to get their degree or certification. Once a student is given Pell grant eligibility, the school will either credit the funds directly to his or her school account, pay him or her directly, or combine both methods. However, since the government is effectively giving money freely to students, there are strict policies involving those who will be qualified for the program, the most important qualification being the economic student of the applicant. Furthermore, there are strict rules regarding the use of the money given by the Pell grant.

One such issue is regarding the transfer of schools. Since the Pell grant is usually awarded per term (semester, trimester, or quarter), you can pay for your enrollment in the program using the money that you are awarded. However, if you suddenly transfer schools in the middle of the term, the money will not be carried over. You will only be eligible for the portion of the year that you haven’t enrolled in yet since you’ve already used the money for that term in your previous school. You will also need to inform the Financial Aid Office of your new school with your records so that they will be able to determine your Pell grant eligibility and award you accordingly, since Pell grant financial aid does not transfer from one school to another, strictly speaking. The new school should be the one to determine how much you will be getting, so the grant you may get in your new school may be lesser or more compared to what you were previously getting, depending on your needs. You may also be asked to submit a new set of requirements so they can have their own records.

The situation becomes problematic if the student still has outstanding debts from his or her previous school. A federal grant such as the Pell grant cannot be granted to students if they still owe money to their former academic institution or have defaulted on a previous student loan. He or she will only be able to get his or her Pell grant eligibility if he or she has made satisfactory payment arrangements with the other school.

If you still have outstanding debts from your previous school, try to settle this as early as possible or keep the loan current so that it wouldn’t go into default. Make inquiries about whether deferring payment will affect your Pell grant eligibility.


  • Hussain Shoaib

    Hussain Shoaib is an author and digital marketer with expertise in financial aid and education. He has extensive knowledge of the Pell grant and FAFSA, and has published numerous articles on these topics.

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