Learning how to apply for FAFSA may result in your out of pocket college costs being very different than your college’s advertised tuition. Even if you already know how to apply for FAFSA, read on to get a better understanding of federal financial aid and maximizing your financial aid awards.
The cost of attending college is greatly dependent on where you attend and what you’re studying. According to BigFuture, college costs can vary from $3,440 to $32,410. If looking at those numbers is daunting to you, then you’re not alone. Thanks to financial aid, many students pay only a fraction of these costs or even none at all.
FAFSA stands for Free Application for Federal Student Aid. It’s the largest provider of financial aid in the nation, with over $120 billion provided each year to help qualified students pay for college or career school. FAFSA is part of the US Department of Education and federal student aid includes grants, loans, and work study funds.
Limits and Amounts
The FAFSA4caster can help you estimate the amount of financial aid you will be awarded.
Most programs require a demonstration of a financial need in order to award the federal aid. The formula for determining eligibility takes into account your family’s expected contribution and subtracts it from the total cost of attendance.
Other requirements regarding how to apply for FAFSA include maintaining satisfactory academic progress and enrolling or being part of an eligible degree or certificate program. A more comprehensive list of requirements can be found on the FAFSA website.
Most aid will have semester, yearly, and/or lifetime limits. The most commonly known federal aid grant, the Federal Pell Grant, has a yearly and lifetime limit. For the 2017-2018 award year, the limit is $5,920. View the FAFSA website article about Federal Pell Grant limits for a better understanding of the subject. Federal student loans also have yearly limits and limits tied to the length of your program.
What Types of FAFSA Are There?
The Federal student aid availability varies depending on the student’s criteria and can include any of the following:
- Federal Pell Grants are usually available to undergrad students.
- Federal Supplemental Educational Opportunity Grants (FSEOG) is for students with exceptional financial need.
- Teacher Education Assistance for College and Higher Education (TEACH) Grants is for students who intend to teach in low-income areas.
- Iraq and Afghanistan Service Grants are for children of service members who have died in Iraq or Afghanistan after 9/11/01.
- Federal Work-Study Program to earn money and gain work experience.
- The Federal Perkins Loan Program is a campus-based low-interest loan program.
- William D. Ford Federal Direct Loan Program enables parents and students to borrow take out low-interest loans directly from the federal government. These loans include Direct PLUS Loans, Direct Stafford Loans, Subsidized loans, and Unsubsidized loans.
- State Aid may use FAFSA to determine eligibility.
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How to Apply for FAFSA
FAFSA forms become available in October for the following year. Here is a quick rundown of how to apply for FAFSA:
- Go to the FAFSA.gov website and create an FSA ID. This ID is what you’ll use to identify yourself, login, and fill out your FAFSA. It will also give you access to other parts of the FSA website.
- Gather the documents you’ll need to fill out the FAFSA forms. These will include your social security number, parents’ social security numbers, last year’s tax forms, parents’ birth dates, and bank statements and investment records.
- Follow the directions and fill out the FAFSA. Financial aid is typically awarded on a first come, first serve basis. So, it’s important to fill out your forms early. It takes 3 to 5 days to process your application.
- Don’t forget to include the colleges you are considering attending. You can list up to 10 schools. If you change your mind later, you can always go back and update. This is important so that the school you ultimately end up attending receives your financial aid information.
- Review your Student Aid Report and update your FAFSA if needed. Up to 3 weeks after you submit your FAFSA, you’ll receive a Student Aid Report by mail or email that summarizes the information you provided on your FAFSA form. If it is inaccurate or incomplete, login in using your FSA ID and update your FAFSA. This report will also show you your expected family contribution (EFC) which determines the maximum amount of need-based aid you will receive.
Sending FAFSA application through mail
If you’re mailing the FAFSA instead, the process will be a little different. Here’s how to apply for FAFSA via mail:
- Download the FAFSA PDF.
- Print document and fill out by hand or the blanks are screen-fillable. This means you can fill in the blanks on the PDF by typing in the answers on your computer and then printing the document out. However, saving the PDF will not save the answers you have put in the blanks.
- Look up school codes. If you’re filling your FAFSA out by hand, you’ll need to look up the school codes for the colleges you intend to apply at and include them on your paperwork.
- Mail your FAFSA. Mailed FAFSA takes 7 to 10 days to process after they arrive.
- You will still receive a Student Aid Report, which you should review. Contact 1-800-433-3243 if there are any discrepancies.
Sometime after you receive your Student Aid Report, the colleges you’ve applied and been accepted at will provide you with financial aid award letters. These letters will inform you how much aid you’re eligible for through that particular school.
How Does Repayment Work?
While you don’t need to pay back grants and scholarships, student loans you do. Private student loans will have their own terms. However, there are a variety of ways to pay off federal student loans. Repayment options include:
- Standard repayment is typically a fixed 10-year repayment plan. This is the plan the students automatically enroll in once they’re out of their grace period if they do not enroll themselves in another plan. For consolidated loans, this can be up to a 30-year repayment plan.
- Graduated repayment is a repayment plan where payments begin smaller and gradually increase over time. This is a 10-year repayment plan, 30-year if loans are consolidated.
- Extended repayment is a repayment plan with fixed or graduated payments for up to 25 years. The payments on this plan are usually less than on the graduated or standard repayment plans.
- Two different pay as your earn options take into account your yearly income and base your monthly payments off of it. Usually, these payments are a maximum of 10% of your discretionary income and they forgive any unpaid loan debt in 20 to 25 years. Payment is recalculated yearly and also take into account your family size and spouse’s loan debt.
- Three different repayment options tie to your income, vary in payment size and how they’re calculated. Annual income is a deciding factor in all of them, but your family size and total loan debt may also factor. Some income-based repayment options may offer loan forgiveness after a set amount of time.
The Federal Student Aid website offers a repayment calculator that you can use in anticipation of loan repayment.
In a few select incidences, student loans can be forgiven, canceled, or discharged. The most common are loan forgiveness for teachers or public service employees.
FAQs We Know You Have
Q. When is the FAFSA due?
A. The deadline varies by state and some colleges and states distribute aid on a first come first serve basis. It’s best to fill it out as soon as possible.
Q. Do I have to fill out the FAFSA every year?
A. Yes. After the first year, you’ll fill out a “Renewal Application.” If your financial circumstances have changed, you may receive more or less aid.
Q. If I think my family’s income is too high, should I still file a FAFSA?
A. Yes, because many families qualify for financial aid that don’t think they will.
Q. Where can I find more information about Federal Student Aid?
A. Visit StudentAid.gov or visit the college aid office at the college you plan to attend.
Federal student aid is the largest financial aid source in the nation and knowing how to apply for FAFSA gives you access to this aid. There are many types of aid, including grants and scholarships that don’t require you to pay them back. In addition to that, there are a variety of student loan options to assist in paying for college. What do you think the most difficult part of the financial aid process is?