[Someguywhatever]

Well you could make it a ratio of:

[your income]/[maxincome] * [MaxFinancialAid]

But then you would end up with situations where people can borrow $500 which is useless. So they just allow it up to 150k and then make it a hard cut off as they feel that anybody who makes that much should absolutely be able to pay, and the administration costs of loaning < 10k could be a waste of time lets say.

[colordrops]

But $500 is still a lot to a family who's margins are very tight. Or $2000 for a family that is closer to the threshold.

[Someguywhatever]

Nobody would administer a loan for $500 though, the juice isn't worth the squeeze for financial institutions