There are numerous sources to search through if you're interested in a government loan. There is a difference between a government grant - which you often don't have to pay back, and a government loan - which you need to pay back. If you want more information about getting a government grant, please see the article titled "Applying for Government Grants."
A loan needs to be paid back, so as such you couldn't say it's free. However, there may be little or no cost to getting many of these loans. You will have to do your homework though. As with any lender, they want to make sure that you are legitimate and you're not going to spend it on frivolous things. If you are a business, you will probably need to provide a business plan. If you want a loan for education, be prepared to prove you are actually going to school.
Some loans may have a "forgiveness" term to them. That basically means that if you use the loan for its intended purposes - say education, then you fulfill certain requirements afterwards - say 2 years of charitable work, then the lender will forgive part or all of your loan. You will also find normal repayment terms, as well as delayed repayment terms. Just as there are numerous loans out there for various things, the terms of the loans vary wildly.
One of the most well known government lenders is the Small Business Administration Loan - or SBA Loan. The SBA actually works with both public and private lenders to help small businesses. In addition to the normal SBA loans, you may also find additional help if you are a woman or a minority-owned business. Under the SBA umbrella, you can also find loans to help businesses in economically targeted areas.
Don't forget to check your state's resources. Your local Chamber of Commerce can be a great place to start. They can usually provide a fair number of lenders that target your particular state. You can also check with JAN, the Job Accommodation Network. They have a State Economic Development and Funding Resources page that breaks the list down by state. You click through to your state and they provide local resources that you can work through. jan.wvu
In addition to small business loans, the government runs an enormous housing lending program. Most people have heard of FHA loans. That's part of their broad reach. And of course, who could forget education loans. There are entire websites devoted to helping you fund your college education.
But there are also more specialty loans. For example, if you're a business in a rural area, there are loan programs just for you! If you're in the agricultural business, otherwise known as farming, there are loans just for you.
You may also want to check the Government Benefits website. They provide numerous additional sources of available government help. Not all of it may be loans; some of it may be free assistance of some sort.
The point here is that while government loans and government grants are terms that are often used interchangeably, there is a difference with a wide variety of options for each. Add in the additional sources of government help, and you may find more than one that you are eligible for.