5 Grant Myths That Need to Die

Being in the world of grants and nonprofits, we hear a lot of half-truths, misconceptions and downright myths surrounding grants and funding, and its time to set the record straight. Our goal is to clear up some of the misconceptions that our audience may be under so that they can apply for grants with the correct information in hand. So for your viewing pleasure, here are five grant myths that just need to go away forever.

1) Grant Money Has to be Paid Back:  

This is one of those questions that we at GrantWatch get all the time, “When do I have to pay the money back? A grant is not a loan, and unless a nonprofit breaks a rule regarding the funding, the money never needs to be paid back. Be aware that there are rules regarding how the funds can be spent, and grant recipients must allocate all the requested funds in the grant application.

  2) Grant-Giving-Organizations Require Upfront Payment:

Of all of the myths on this list, this might be the one that we get calls about the most. Unfortunately, there are a lot of scams out there, and this is one of them. It should never cost a nonprofit or individual to apply for or receive a grant. If you are asked for upfront payment in order to receive funding, it is most likely a scam. Avoid this at all costs. And if you or anyone you know is the victim of a grant-related scam, fill out a report at

If you think you may have been a victim of a government grant scam, file a complaint with the Federal Trade Commission online, or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261. You can also report grant-related scam attempts to the Health and Human Services (HHS) Fraud Hotline at 1-800-447-8477.

3) Nonprofits Should Only Apply For Grants in Their Direct Sector:

 So this is a less obvious myth, but no less harmful to successfully navigating grants and funding. Grants generally have multiple categories which grant seekers can apply under. For example, there’s a grant listed on GrantWatch.com with this description: “Grants ranging from $3,000 to $15,000 to North Carolina nonprofit organizations and government agencies for new or existing programs that make a positive impact on the lives women and girls in Avery, Ashe, or Watauga Counties”. This grant is listed in the grants for women on the website but is cross-listed for other categories such as children, community service, secondary education, and youth, among others.

4) Re-applying for a Grant Next Cycle is a Waste of Time:

This myth actually makes sense, but it’s predicated on the wrong criteria. There is a limited amount of grant funds that are allocated from the source giving out funds, whether it’s a municipality awarding funds to a nonprofit to improve a community or a foundation giving a specified amount of money for a category-based-project. Qualifying for a grant doesn’t guarantee funding, but there’s always next quarter or next year or whatever the criteria are for re-applying.

5) Grant Applications Are Useless After Rejection Or Submission:

This is not exactly a myth, because it kind of depends. If you hire a grant writer or someone in your nonprofit writes an incredible application, then that piece of writing is inherently not useless. A good piece of writing can be re-examined, tweaked, and be used again for another application. That’s why it is critical to save all the parts of the process and past applications. This also has the added benefit of allowing you and your team to see what works and what doesn’t.

Hope this myth-busting list helps you on your grant journey, happy searching!