Free Application for Federal Student Aid

Last updated: May 8, 2013 by Ada Hu

Attending college is not a cheap endeavor, with the ever-escalating cost of tuition being the main expense, paying for college is a constant struggle for families from all walks of life.

But there’s a whole plethora of different student aid available to help low-income students pay for college without going broke.

Whether you are a parent of an undergraduate student, a graduate student, or even returning to school yourself, you should first apply for federal student aid – even if you think you don’t qualify.

What is Federal Student Aid?

Federal student aid comes from the federal government, specifically U.S Department of Education. It’s money that helps a student pay for education expenses at a postsecondary school.

By far, it is the largest source of aid in America; providing over $230 billion in financial aid used by undergraduate and graduate students combined.1

The Free Application for Federal Student Aid (FAFSA) 2 is used to apply for grants, work-study, low-interest federal loans — and need-based scholarships.

This is the first step in getting aid for college!

This free application will ask for your demographic & financial information to determine the amount you and your family are expected to contribute to your college expenses.

Using that information, the schools you listed on your application will determine your financial need and package your financial aid award accordingly.

January 1 is the first day you can submit your FAFSA. The deadline is June 30. But it’s always in your best interest to to fill it out as early as possible as some aid is first come, first served.

Who Gets Aid

The vast majority of students who fill out the FAFSA are eligible for some sort of financial aid. Eligibility is, however, based on your financial need and on several other factors.

When you submit the mandatory FAFSA, they forward the information on the form to the respective school(s) of your choice which in turn will determine your aid eligibility.

To be eligible for aid, you must

  1. exhibit financial need,
  2. be a U.S. citizen or eligible non-citizen with a valid Social Security Number (SSN),
  3. register with the Selective Service3 if you haven’t already. You can register online at, or call 1-847-688-6888,
  4. have a high school diploma or a General Education Development (GED) certificate,
  5. maintain satisfactory academic progress in college,
  6. certify that you are not in default on any federal student loan, and
  7. certify that you will use federal student aid only for educational purposes

Do note that these are general criteria for most people to be eligible for federal aid. Each specific program has its own unique requirements for eligibility, so read up on the specific aid you want to apply.

Types of Aid

The federal government provides grants, most of which is based on students’ financial situation. It also provides education loans for students (and parents) and work-study awards – a form of financial aid that provides part-time jobs to students with financial needs.

From the student’s perspective, student grant is the most desirable form of financial aid as it does not have to be repaid.

Let’s go over each one of them;

Federal Grants

These are monetary aid awarded to college-bound students based solely on the basis of financial hardship. Students who are awarded grants don’t need to pay back the money to the government. In a nutshell, this can be the best type of financial aid.

One of the most popular college grants is the Pell Grant for very needy students to attend college. The current maximum award is $5,550 – that’s free money for college that they don’t have to pay back.

Update: In California, thousands of students – including some who entered the country illegally – will become eligible for Cal Grants and other state-funded aid for the first time this year under the California Dream Act.4

Federal Work-Study

Formerly known as College Work-Study Program, the FWS program offers students the option work part-time to finance their own education while enrolled. [ read more ]

It entails a bit more effort on the part of the student, yes, but at least it provides a way to help ease the burden of paying for college. It also provides an opportunity for the students to build networks and gain experience in their field of study.

If you’re interested in getting a Work-Study job, make sure you apply for aid early as most schools award funds on a first come, first served basis.


Scholarships, on the other hand, are a form of gift aid that does not need to be re-paid. These are primarily awarded to deserving students who demonstrate high achievement in areas such as academics, athletics, music, art, or other fields.

Although scholarships are also a form of financial aid, they are not part of the FAFSA process. Scholarships must be sought out and applied for individually – usually includes an essay, student résumé, and letters of recommendation.

However, some may require you to complete a FAFSA, and in Georgia, it will help you apply for the HOPE scholarship.

Education Loans

Unlike grants & scholarships, education loan is a form of financial aid that must be repaid, with interest. These loans come in two flavors: subsidized and unsubsidized.

When your loan is subsidized, the government will take care of paying your interest expenses while you are still in school. For unsubsidized loan, you are responsible for all of the interest that accrues during all periods while enrolled.

If you are a dependent student, your parents may apply for Parent Loan for Undergraduate Students or PLUS Loan to help pay your college expenses. Here, your parents are legally responsible for repayment on the loan.

Alternative funding options may include loans from banks and other private lenders but in almost all cases, federal loans are the better deal for student borrowers.

Federal loans offer many benefits not typically found in private loans. These benefits include low interest rates, flexible repayment plans, loan deferment and forgiveness options. The bottom line is, you should first exhaust these alternatives before considering a private loan.

Though federal grants and loans differ in eligibility requirements and whether they have to be repaid, the application process for both is essentially the same.

In addition to loans and grants, a series of tax credits and deductions also subsidize students and families paying for college by reducing the amount of their income tax.

  1. Source: Trends in Student Aid 2012 by College Board []
  2. The FAFSA is available in Spanish. From the main page at click on the link at the top right hand corner that says Espanol. []
  3. If you are a male born on or after Jan. 1, 1960, are at least 18 years old, and are not currently on active duty in the U.S. Armed Forces, you must register with the Selective Service System to receive federal student aid. []
  4. Source: California DREAM Act now law []

How Do I Defer my Student Loans?

Last updated: February 7, 2013 by Ada Hu

If you’re experiencing a financial hardship, you may request for a “deferment” or “forbearance” on your loans, as long as the loan isn’t in default.

How Do I Make Corrections to my FAFSA?

Last updated: January 18, 2013 by Ada Hu

If the information you entered on your FAFSA was incorrect as of the day you signed the FAFSA, you can still make corrections on the FAFSA official website.

What Happens if I’m Selected for FAFSA Verification?

Last updated: January 25, 2013 by Ada Hu

FAFSA verification helps prevent ineligible students from receiving aid by reporting false information and ensure that only eligible students receive all of the aid for which they are qualified.

How the IRS Data Retrieval Tool Works?

Last updated: January 23, 2013 by Ada Hu

Beginning in February 2012 (and beyond), all applicants and parents of dependent applicants who have completed and filed a Federal Tax Return, will be directed to use the IRS Data Retrieval process to complete their FAFSA.

How Do I Renew my FAFSA?

Last updated: February 7, 2013 by Ada Hu

Because financial and family circumstances can change from year to year, you must renew your FAFSA each academic year you wish to receive financial aid.

After the FAFSA: What Happens Next?

Last updated: February 14, 2013 by Ada Hu

After you apply, you will receive a Student Aid Report (SAR) – the result of your FAFSA. Assuming all information is correct, the SAR will contain the Expected Family Contribution (EFC) which in turn will be used to determine how much aid you’re entitled to.

How Do I Submit my FAFSA?

Last updated: February 9, 2013 by Ada Hu

To submit your FAFSA, you have three (3) options: online, PDF and paper. The best option is to complete the online version of the FAFSA at

Am I an Independent or Dependent Student?

Last updated: January 18, 2013 by Ada Hu

Am I dependent or independent? Your answers to questions on the FAFSA determine whether you are considered a dependent or independent student.

What is a FAFSA PIN?

Last updated: January 26, 2013 by Ada Hu

Your PIN which serves as your electronic signature can be used each year to electronically apply for federal student aid and to renew your FAFSA online, if you apply last year.

What Do I Need to Complete My FAFSA?

Last updated: February 14, 2013 by Ada Hu

To complete the FAFSA, you will need records of income earned in the year prior to when you will start school. Essentially, for the 2012-2013 school year you will need financial information from 2011.