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How do I apply for federal student loans?

December 06, 2018

There are several different types of federal students loans and you may not be sure which loan program is right for you.  Luckily, you do not need to know this in order to apply for federal student aid.  


Applying for Federal Loans as a First-Time Applicant

Your first step is to fill out the Free Application for Federal Student Aid (FAFSA) form.  If you are an independent student, then you will provide the information below for yourself.  If you were listed as a dependent on your parents’ tax return two years ago (more on that below), then you will provide the required information for your parents instead.


Information Required to Complete FAFSA Form

You will need the following information to complete the FAFSA form:

  • Social Security number

  • Alien Registration number (for non-U.S. citizens who meet the basic eligibility criteria for federal financial aid)

  • Driver’s license number (if you have one)

  • Federal Student Aid Identification (FSA ID): This is a username and password that serves as your electronic signature for the FAFSA application.  Each student, and one parent of dependent students (if applicable), needs to create an FSA ID. Students and parent(s) are required create their own FSA IDs, each with a unique email address and phone number.  Failure to do so can cause problems or delays with signing and submitting the FAFSA form or receiving financial aid.  

    • Pro tip: It can take up to three days to use your FSA ID after creating it.  To save time, create your FSA ID now.

  • Tax records from the year that is two years prior: If you are applying for federal financial aid for the 2019-20 school year (for example), then you must provide your 2017 tax information.  The FAFSA form allows you to import this information directly using the IRS Data Retrieval Tool.  However, you should still keep your tax return documents handy, since not everyone is eligible to use the IRS Data Retrieval Tool and the tool does not input all the necessary financial information to complete the FAFSA form.

    • Pro tip: Your dependency status (for tax purposes) in the year two years prior to the school year for which you are applying for financial aid (for example, 2017 for the 2019-20 school year) determines whether you should complete the FAFSA form as a dependent or independent student.  If your parents listed you as a dependent on their tax return two years ago, then you are not eligible to apply for federal financial aid as an independent student.

  • Records of any untaxed income (if applicable): Again for the year that is two years prior, you are required to report any untaxed income that you may have received.  Untaxed income may include child support payments received, interest income, or veterans noneducation benefits.

  • Records of your assets: You are required to provide a complete list (with account balances or dollar values) of your assets, current as of the time you submit the FAFSA form.  This list must include all of the following, as applicable: personal checking and savings accounts, retirement or other investment accounts, and real estate holdings (excluding your family home).

  • List of the school(s) you are interested in attending: The FAFSA form allows you to list up to ten schools, all of which will automatically receive your FAFSA results.  If you would like your FAFSA results sent to more than ten schools, then you have a few different options for getting that done.

    • Pro tip: Some states require you to list the schools in a certain sequence in order to qualify for state financial aid.  Find out here whether your state has specific requirements for how the schools are listed.


Next Steps After FAFSA Submittal

After you have completed and submitted the FAFSA, your eligibility for federal student aid will be evaluated by the U.S. Department of Education.  All ten schools listed on your application will receive the results but, more than likely, only the schools to which you have been accepted will utilize your FAFSA results to send you offers for financial aid.  However, before any loan proceeds are disbursed, you may be required to complete entrance counselling (either in-person or online) to ensure that you clearly understand your repayment obligations.  In addition, you will be required to sign a Master Promissory Note whereby you agree to the terms of the loan.  The loan monies will be disbursed directly to your school, which deducts the cost of tuition.  The remainder, known as your student refund check, is paid by the school directly to you.


Applying for Federal Loans as a Returning Student

Applying for federal financial aid gets easier after the first year.  Although you must submit a FAFSA form to the U.S. Department of Education for every year that you wish to receive financial aid, you may utilize the Renewal FAFSA form in subsequent years following the first year.  When completing the Renewal FAFSA, you may choose to have most of the questions pre-filled for you with information that you provided in previous years.

  • Pro tip: You are not obligated to complete the Renewal FAFSA, even if you have already submitted a FAFSA in prior years.  You can always start fresh with a new FAFSA if you choose to do so.


Get More Information

Still worried about making a mistake when completing the FAFSA form?  Check out the U.S. Department of Education’s blog on 12 Common FAFSA Mistakes.