Watch for Scholarships that Charge Application Fees


August 5, 2009
by Scholarships.com Staff
The fall semester is just around the corner, and in addition to the start of classes, students are also beginning to gear up for scholarship application season, the time from late fall to late spring when the majority of scholarship applications are due. If you are just starting your scholarship search, there are a number of things to keep in mind when deciding which awards to apply for. The size of the award, the application deadline, the amount of work required, and your likelihood of winning are all criteria you likely use in evaluating awards. One other thing to think about before putting together an application, though, is whether there will be any costs associated with the scholarship contest.

The fall semester is just around the corner, and in addition to the start of classes, students are also beginning to gear up for scholarship application season, the time from late fall to late spring when the majority of scholarship applications are due. If you are just starting your scholarship search, there are a number of things to keep in mind when deciding which awards to apply for. The size of the award, the application deadline, the amount of work required, and your likelihood of winning are all criteria you likely use in evaluating awards. One other thing to think about before putting together an application, though, is whether there will be any costs associated with the scholarship contest.

Every scholarship application will have some degree of cost associated with it, whether it's postage, time, or the costs involved in creating your application materials (for example, printing an essay or filming and editing a video). However, some scholarship applications are going to be more costly than others, and when a scholarship charges an application fee on top of the time, energy, and money you're already putting into it, it should be cause for some careful thought.

Scholarship opportunities are generally seen as altruistic offers made by organizations that want to help students succeed in college. Sure, many scholarships have a promotional nature, as there are few better ways to attract interest in a company than by giving something away for free. However, some companies actually charge students to apply for scholarships. For example, we came across one scholarship essay contest that offered a $500 award and charged a $15 application fee. The scholarship provider boasted of receiving 10,000 applications in a year, meaning they hauled in $15,000 and only gave away $500. Unless they're spending over $14,000 promoting the contest and paying people to judge the essays, it's reasonable to believe they're profiting off the scholarship in more ways than just boosting traffic to their site. Not necessarily the most altruistic endeavor, huh?

This isn't the only example of a scholarship contest charging a seemingly unnecessary application fee. Offers like this aren't necessarily scholarship scams, as legitimate awards are offered to people who apply. However, why would you pay money for something when there are so many other ways to get it for free?

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Discuss

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J.T  on  8/17/2015 6:22:41 PM commented:

Out of curiosity, is it even legal for a scholarship fund to financially gain through application fees? ie. Charging $10 an application, having 1000 applicants = $10,000 and then offering a predetermined scholarship amount of $500? It seems that the above mentioned group was illegally gaining, but I'm no law expert

L. M.  on  8/3/2015 9:25:11 PM commented:

Rather than treating all scholarship opportunities that charge an application fee with distrust, consider all factors. A donor who must process thousands of applications will have significant labor and other costs. Even getting the word out can cost them a lot of money they can't recover. Their willingness to donate money and/or services for no fee shouldn't be cast into doubt by their practical consideration of choosing to partially fund the selection with application fees. I have a scholarship worth thousands and cannot afford to offer it without recovering some of my costs and time for the publicizing and detailed selection process alone. However, I take care to ensure that the total funds received do not exceed the normal cost of the services donated. So, if I were to receive $6,000 in fees but the services donated were $4,000, I'd donate $2,000 more in services, even though the funds only paid part of the selection process and not the services.

L. M.  on  8/1/2015 6:25:14 PM commented:

Rather than treating all scholarship opportunities that charge an application fee with distrust, consider all factors. A donor who must process thousands of applications will have significant labor and other costs. Even getting the word out can cost them a lot of money they can't recover. Their willingness to donate money and/or services for no fee shouldn't be cast into doubt by their practical consideration of choosing to partially fund the selection with application fees. I have a scholarship worth thousands and cannot afford to offer it without recovering some of my costs and time for the publicizing and detailed selection process alone. However, I take care to ensure that the total funds received do not exceed the normal cost of the services donated. So, if I were to receive $6,000 in fees but the services donated were $4,000, I'd donate $2,000 more in services, even though the funds only paid part of the selection process and not the services.

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