The very first thing you'll note on the federal government's grants website is the following statement: "ATTENTION! Grants.gov does not offer money for personal financial assistance or debt." Even though a basic Internet search will provide pages of website links to sites that offer "government grant assistance," there is nothing on these sites that you can't find for free yourself. The worst of these official-looking sites will steal your money and your identity.
U.S. Government Grants: Facts and Fallacies
While it's true that the federal government does provide billions in free aid and loans every year to those who apply, successful applicants must meet specific criteria and no funds are available for consumers who are looking to eliminate personal debts, such as credit cards.
However, if you think you may qualify for a grant relating to agriculture, the environment, or the myriad other programs that the Grants website administers, visit www.Grants.gov. You can apply online, and there is never a fee. You won't need to supply any personal information, only information that pertains to the grant itself (for example, how you plan to innovate and adopt an approach to environmental conservation).
Federal Benefits
The federal government also provides a benefits website, www.Benefits.gov, that describes many loan opportunities that may work for you. For example, if your debt is the result of a small-business start-up, you may be eligible for a small-business loan (or microloan). If you're late on your mortgage and need help getting back on your feet, you may qualify for an FHA streamline refinance or mortgage modification. Like federal grants, consumers must meet certain criteria to be eligible for these programs.
As of April 2011, there are no federal loan programs available for consumers who are behind on their personal debts, like credit cards and auto loans.
Grants Scam Artists and Identity Theft
Websites that offer "government grant assistance" in exchange for a fee -- often small -- may provide you with legitimate information, but it's information you can locate for free by yourself on the federal site. However, a more insidious scam has found its way into the game: identity theft.
Unscrupulous companies develop official-looking websites and hire professional-sounding telephone representatives. If you are contacted about a grant, do not provide any personal information. The U.S. government does not require your credit card or bank account information when reviewing a grant application. If you're asked for this information, it may be a ruse that's disguising the true intent: identity theft.
Identity theft can take years to undo and cause tremendous personal damage. If you suspect you've been scammed, order your free credit reports immediately at www.AnnualCreditReport.com. Report any suspicious activity. Complain to your state attorney general's office and also the Better Business Bureau.
If You're in Debt
The best resource if you're in over your head in debt is a nonprofit called the National Foundation for Credit Counseling. You'll get a free budget and credit consultation administered by one of the NFCC's counselors, all of whom are trained in budget and credit management.
If you're eligible, you can enroll your unsecured loans in a debt management plan. Your debts will be paid in full in five years. The accounts will be made current -- even if you're already delinquent -- and you may have your interest rates reduced. The accounts will be closed.
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