Why do loans come before grants?

[Kendall]

Why do loans "fill" the financial aid package before federal grants?


College A - private college tuition/r&b about 37000 per year

Pell Grant, 2 other federal grants and work study


College B - lg state school, tution/r&b about 14000 per year

only a Pell grant, work study


both awards include scholarships that cover most of tution(within 1250 of tuition at the private school and the state school varies, some semesters it covers it and then some, some it won't be quite enough)

both awards include loans.

College B says that because of his scholarship his award package didn't have room for the other 2 grants.

My question is - why would loans come in to fill the cost before the grants would? Do the colleges determine this or does the government?


Thanks

[transientChris]

It is the college that decides who gets grants other than the Pell grant which is dependent on income. I would strongly recommend that she go with the school that has less loans.

[Kendall]

Thanks!