Student Federal Loans
Despite the mammoth financial crisis the country is facing today, the government continues to support education as a major social investment for American students entering college.
Billions of dollars are poured into this country’s educational system to support every young man and woman’s aspiration for college education and chance for a better life and future for them, their family and love ones.
This seemingly complex mechanism that weaves the collective dream of every American student start with a simple internet browsing, keying in “FAFSA,” which means Free Application for Federal Student Aid (FAFSA) http://www.fafsa.ed.gov/. The website opens new windows for students to discover funding opportunities for college education.
FAFSA is managed by the Federal Student Aid (FSA), an office under U.S. Department of Education, the agency assigned by the government to become the main conduit among students, colleges and universities, and other agencies, government and private, with a stake in education. Its role is to help eligible high school graduates to secure college education through federal assistance.
With today’s high cost of college education, you need FAFSA to open a wealth of financing opportunities to help you pay for college. It’s easy and completely free. If you’re done with high school, the entire exercise is almost child’s play.
This is not to say, of course, that this is not serious stuff. It is. Your future depends on it. You need to understand the flow of their questioning, comprehend what they mean, and respond with sincerity and candor, and with the required supporting documents to show your need for financial assistance to pursue your college education.
Requirements
While the application is free, there are a number of requirements you must have to be eligible for Federal Student Aid. Some forms of aid are based on the financial need and are given free in the form of scholarships and grants. Others are unsubsidized loans, but with lower interest rates than private lenders and come with more liberal payment schemes. Repayment schemes are not as rigid as those demanded by private lenders – giving you leeway when it matters, like when you don’t get immediate employment after graduation and other emergencies.
Essentially, you are eligible to apply for a loan if you are and/or have the following qualifications and requirements:
- U.S. citizen or permanent resident
- Your own valid Social Security Number
- Diploma, GED, home-schooling certification, or pass an “ability to benefit” test
- A regular student seeking a degree or certificate
- Registered with the U.S. selective service (males age 18-25)
- Fill up a FAFSA with a promise to use federal aid only for education purposes
- Not in default on any student loan
- Do not owe refunds on any federal student grants
How to Apply for Student Loans
Basically, there are three ways to apply for FAFSA student loan. One is by simply filling up the application form available at the FAFSA official website. Another is by printing the application form, filling it up, and mailing it for processing. The third is by requesting the form by calling 1-800-4-FED-AID (1-800-433-3243).
Forms are also available from your local public library and from the financial-aid office of the college or university that you are enrolled in or are planning to enter. Since you will be making a new application every school year, it’s important to keep your own copy each time and keep it handy for your reference.
The simplest way and fastest is to fill out your FAFSA application form online using the website’s electronic filing protocol. This eliminates the delay when sending your application via “snail mail.” To fast-track your application and for FAFSA to immediately assess and validate your application, make sure you review your answers to avoid mistakes and have all your documents ready for immediate submission.
Applications for every incoming school year start after January 1 and end June 30. It’s best to submit your application as early as possible to allow for corrections in your entries and to take advantage of the scholarships, grants, and federal loans while they’re still available. Awards are offered until funds are depleted. Moreover, the college of your choice may have a different deadline.
Aside from the requirements cited above, you will also need to have records of income earned in the year just before the start of the school year you plan to enroll. This means that students applying for school year 2012-2013 should use the financial information for 2011. Since you are likely to be using the records of your parents, it’s best that you involve them in this process. The process is easy and mechanical, but a bit tedious with around 139 questions in the list. If you filled up the forms properly and submitted the necessary documents, then you should have a response in a matter of weeks, hopefully good news.
Student Aid Report (SAR)
Three weeks or so after completion and submission of the FAFSA, you will receive the Student Aid Report (SAR). You need to review this information carefully for errors and to make the corrections if needed. This is where the copy, both electronic and hard copy, you set aside can come in handy.
The college or colleges, if you listed more than one, on your application will receive a report of your eligibility for federal financial aid. The colleges can also tell you other possible sources of financial assistance you may be eligible to apply for.
Below are a few other tips for completing the FAFSA form:
- 1. Read the eligibility section and instructions before you begin.
- 2. If you’re using paper, get several copies to provide allowance for mistakes. Use a duplicate copy for your initial draft before transferring the information to a final sheet for submission to FAFSA.
- 3. Whether it’s a FAFSA form or not, it’s a good idea to save your files often.
- 4. Make sure you save a copy of your application for your reference, whether online or paper.
- 5. Keep your PIN number in a safe place. You will need it every time you log onto FAFSA to check the status of your application or update information.
The SAR and the school of your choice will let you know whether or not you’ve qualified for different types of federal assistance, although most applicants are assured to receive a SAR that notifies their eligibility for federal financial aid.
By returning the SAR to your selected college, its financial-aid office will then begin the process of verifying your award of financial assistance. This process involves checking the accuracy of the information you supplied with another available verifiable information. After this is done, the office will inform you the cost of your college education and how much more you need to raise on top of your federal assistance.
Student Loan Information
The FAFSA serves as a universal clearing house for financial aid. When you complete your application, you open yourself to different types of financial assistance, ranging from outright grant and scholarship to subsidized loans and work-study program. It’s a one-stop-shop for all the financial aids you need. The SAR will tell what form of assistance you are qualified for.
The Pell Grant, for example, grants up to $5,550 for students with low Expected Family Contribution (EFCs). Stafford Loans provide advances with a fixed interest of 6.8%. Depending on an objective assessment of the subject student, a Stafford loan may also be subsidized by the government. A Perkins loan is similar to the Stafford, but is released to schools that are Title IV-eligible. The Federal Work-Study Program allows students to get part-time work up to a predetermined amount and have 75% of their salaries reimbursed by the federal government.
On very rare occasions, the Federal Students Aid (FSA) may find an applicant ineligible for financial assistance. This is unusual though, as FAFSA is always able to find a match for every applicant.
But if FSA indeed finds you ineligible, this is not the end of the line for you. Oftentimes, your college of choice, through its financial assistance office, can direct you to other possible sources of financial aids, including private scholarships and student work assistance program It can, likewise, refer you to a bank or financing company with the private student loan program.
The FAFSA is a rich resource for eligible students to find funding for their college education. However, you need to study the program very well to maximize your chances for being chosen for the best federal-funded financial assistance program.
Sometimes, you’ll wonder, “why do they ask that?” You need to find that out yourself to know. The website explores the purpose of FAFSA questions and discusses how information should be reported.
If you’re indeed in a difficult financial situation to pursue your college education, and you know how to relay that using the FAFSA questionnaire, then your chances of being ineligible become practically nil and your likelihood of being approved for a scholarship or financial assistance becomes closer to reality. After all, the FAFSA was created not to stop people from dreaming, but help them pursue their dreams.
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