Grant Money Scams

You've seen the commercials or received the emails about how you may be qualified to receive a $25,000 government grant. The catch is that you have to part with some of your money (usually around $50) to find out which grants you allegedly qualify to receive.

The reality of the situation is that you do not need to spend a penny to find out what grants are available. All you need do is visit the U.S. government's grants website. You can do a search (for free!) to see if you qualify for any grants.

The problem with government (and most private) grants is that (1) they are usually only for non-profit organizations, and (2) for individual grants, you usually must meet some predetermined poverty level, age group, disability, and/or single parent guideline in order to qualify. If you do qualify, however, you must fill out the grant application thoroughly and submit it to the proper agency. Having done that, it may be months before you get any word as to whether you will receive any grant money.

Basically, grants are not quick fixes. If you are desperate for cash now, a grant will not solve your problems. Most of the companies that offer grant writing software or other "assistance" in obtaining grants prey upon your need for money, hoping you'll think that this time, you actually will get something for your money, and you'll send for their package.

Of course, you will get something for your money, but you probably won't think it's worth the amount you paid, particularly if you're hurting financially in the first place. But you're far more likely to receive a better return on your investment if you make a "please help" sign and sit with it on a street corner.

Many times, these scammers will offer a refund if you do not end up getting a grant after using their program, but typically, you'll never see your money again.

Tips to Avoid Being Scammed

Don't pay for a "free" grant. If you are asked to pay money in order to claim a "free" grant, it isn't really free. Real government agencies don't tell you that you have been awarded a grant and then ask you to pay a "processing fee" for it. And the government won't make you pay for a list of organizations that award grants. You can find the names of agencies and foundations that award grants at any public library or on the Internet, for free.

Don't believe everything you hear. Just because someone claims he is from an official-sounding "government agency," doesn't mean it's true. Always double-check before you give any of your hard-earned money away.

If you think you have been scammed, file a claim with the FTC. It's there to protect consumers.