How Can Fafsa Help You Pay For College?

By the Pachyy Editorial Team The Pachyy Editorial Team comprises a diverse and experienced team of writers, researchers and subject matter experts whose aim is to provide you with useful insights, guidance and commentary on all matters related to your personal finances.

Are you interested in attending college or university but unsure about how to cover the costs? Don’t worry, we’ve got you covered! The Free Application for Federal Student Aid (FAFSA) is a helpful program offered by the federal government that aims to connect students in financial need with federal loans and grants. Completing the FAFSA is easy and convenient, as it’s an online form that usually takes just a few hours to fill out. The application will ask for various details about you, your finances, your residency status, and the school you plan to attend. Once you provide this information, our system will determine your eligibility criteria and suggest suitable financial aid options for you. In addition to private loans like personal loans (secured or unsecured), the U.S. Department of Education offers a variety of resources to assist you in paying for college, making the process less burdensome. Through the FAFSA, you can explore both subsidized and unsubsidized loan options and find out which one would work best for your situation. To learn more about FAFSA, the differences between subsidized and unsubsidized loans, and many other useful details, stay tuned! We are here to help you navigate the world of student financial aid with ease. Did you know that most community colleges, universities, and other higher education institutions accept the FAFSA? In fact, many of them require FAFSA documents before considering students for financial aid or scholarships. So, it’s a great idea to fill out the FAFSA application regardless of your financial situation. Here’s a helpful tip – FAFSA awards are usually given on a first-come, first-served basis. So, the earlier you complete your FAFSA application, the better your chances of receiving aid. While applying for FAFSA, it’s important to know that it doesn’t always mean free money. While there are grants and scholarships that don’t need to be paid back, some loans do. The Federal Pell Grant program is one of the largest federal grants available for undergraduate students.¹ The amount of financial aid you receive after completing the FAFSA form depends on factors such as:

Your income and your family’s income
The number of children or dependents in your immediate family
The cost of attendance at your chosen college or university
Any extraordinary financial circumstances you might need to explain on your FAFSA student aid report, like homelessness

Here’s an interesting statistic: 36.7% of undergraduates receive an average of $8,285 in federal loans annually, and 42.0% of undergraduates receive an average of $5,179 in federal grants annually.²

Welcome to Federal Financial Aid Qualification!

Are you wondering how to qualify for a financial aid package? Don’t worry, we’re here to help! In order to be eligible for federal financial aid, most students need to meet these basic requirements:

If you’re applying for financial aid to help with college or university expenses, you’ll need to have a high school diploma or equivalent. Don’t worry if you were homeschooled, as long as you completed your high school education according to your state’s guidelines, you’re eligible too!

You also need to have received acceptance to a college or university that accepts the FAFSA form. It doesn’t matter if you’re in a regular undergraduate program or pursuing an eligible degree or certificate program, as long as you’re accepted.

Make sure you have a valid Social Security number, unless you’re from the Republic of Marshall Islands, Federated States of Micronesia, or the Republic of Palau.

Lastly, in some cases, you may need to maintain satisfactory academic progress in order to keep your federal or state-based financial aid.

We hope this information helps you understand how to qualify for federal financial aid. If you have any more questions, feel free to reach out to us at any time! Are you wondering about the factors that determine eligibility for federal student aid? Let’s break it down for you:

The amount of financial aid a student receives depends on their Expected Family Contribution (EFC), Cost of Attendance (COA), and overall financial situation.
The financial aid office will assess a student’s eligibility for financial assistance.
To determine the amount of financial aid, the office of financial assistance will subtract the EFC from the COA. This calculation will help determine the need-based grants, loans, and scholarships the student is eligible for.
Additionally, the COA will be compared with the need-based aid awarded to determine if the student is eligible for any non-need-based aid.

If you are not satisfied with the amount of financial support you receive, don’t hesitate to discuss it with them and negotiate your student loan debt.

Understanding Parent and Student Income

When filling out FAFSA forms, the income of both the student and their family is required. Generally, low-income families are eligible for more financial assistance compared to higher-income families. Typically, the federal government expects the student to contribute at least 20% of their income to their education expenses, while parents or guardians are expected to contribute around 5.64% of their total income.

Number of Children in Your Family/Household

When completing your financial aid form, you’ll be asked to indicate the number of children in your family. This information helps determine your Expected Family Contribution (EFC) or the amount of aid the government may grant you based on the number of dependents in your immediate family or household. Starting July 2023, the Expected Family Contribution (EFC) will be referred to as the Student Aid Index to avoid confusion.

Understanding Cost of Attendance (COA)

The Cost of Attendance (COA) plays a role in determining the amount of school-based financial aid a student may receive. The COA includes various factors:

Expense Type	Description
General Tuition Expenses	Costs associated with tuition and academic fees.
Room and Board or Living Expenses	Expenses for students not using campus housing.
Education Supplies	Costs for books, supplies, transportation, and more.
Childcare Allowance	Additional allowance for students with dependents.
Disability-Related Costs	Expenses related to pre-existing disabilities.
Study-Abroad Program Costs	Reasonable costs for qualifying study-abroad programs.

Based on the information you provide on your federal student aid form, you may be eligible for various federal financial aid options. Here’s more information on some of the financial aid programs and federal grants you could qualify for after completing the FAFSA form.

Need-based Financial Aid

The first type of federal student aid available is need-based financial aid.

Federal Pell Grant

One of the most sought-after types of financial aid is the Federal Pell Grant. This federal grant does not need to be repaid, making it a very attractive option for most students. Pell Federal Grants are designed for students with “exceptional financial need,” meaning they come from extremely low-income families or face challenging circumstances that make paying for college difficult or impossible. Additionally, the Pell Grant is typically awarded to undergraduate students pursuing their degree.

Federal Supplemental Educational Opportunity Grants

Similar to the Federal Pell Grant, the Federal Supplemental Educational Opportunity Grant is also a non-repayable grant intended for students with “exceptional financial need.” However, this specific grant is only available at certain colleges and universities.

Subsidized Federal Student Loans

A subsidized loan means students are not required to pay interest on the loan while they are in school. Additionally, there is a grace period after graduation that exempts former students from paying back interest on their federal student aid. However, after this grace period ends, students are responsible for making payments on their loan. Subsidized loans can range from $3,400 to $12,500 per year, depending on factors such as:

Whether you are an independent or dependent student
Your cost of attendance (COA)
Your Expected Family Contribution (EFC)
Your income

Subsidized student loans are only available for undergraduate students and not applicable to graduate school.

Federal Work-Study

Another type of need-based federal student aid is the Work-Study program. Under this program, students can secure a job on campus, and the earnings can be used directly towards their tuition costs. Certain Work-Study programs even allow students to retain a portion of their wages while directing the rest towards tuition payments to the school.

Non-need-Based Federal Student Loans

Once students have been awarded their need-based financial aid package, the financial aid office assesses how much non-need-based funding they qualify for.

Unsubsidized Federal Student Loans

Unsubsidized loans require students to pay interest while they are in school. Although this may seem slightly inconvenient, unsubsidized loans may have a lower interest rate compared to subsidized loans, making them a relatively more affordable option.

Federal PLUS Loan

Federal PLUS loans cater to parents returning to school or graduate students. This loan type is not subsidized, so interest accrues while the parent or graduate student is in school. Students can choose to either have the interest added to their principal or pay it off while in school.

Teacher Education Access for College and Higher Education (TEACH) Grants

The Teacher Education Access for College and Higher Education Grant is specifically designed for students pursuing a career in teaching. To qualify for this aid, students must be enrolled in specific classes and have worked for at least four years in an elementary or secondary school or educational service agency that primarily serves lower-income students and families. If these requirements are fulfilled, the TEACH grant does not need to be repaid. However, failure to meet the TEACH grant requirements will result in the conversion of the grant into a direct unsubsidized loan. Now that you have a better understanding of FAFSA itself, let’s go over the process of filling out the FAFSA form. The form itself is pretty straightforward and will ask for the following information:

Your personal and financial information
Information about the school you plan to attend (your application will be sent to the school’s financial aid office)
Questions about your residency status for financial aid eligibility

If it’s your first time filling out the application, it might seem a bit overwhelming, but accuracy is crucial! We highly recommend creating an account, as it allows you to complete the form electronically and helps prevent mistakes. If you need assistance, there are online resources available. If you have previously filled out a FAFSA form and created an account, you can access that information, making the process faster and easier.

Create an FSA ID

To create an ID, you’ll need your social security number, birthdate, name, and other personal information. You can use this ID or your personal information to log in when filling out or checking your FAFSA application.

Gathering the Required Documents

Before starting the application, make sure you have the necessary documents on hand. Here’s what we recommend having:

Your social security number (enter it exactly as it appears on your card)
If you are a dependent student, your parent’s social security number
Your driver’s license number (if applicable)
If you are not a U.S. Citizen, your Alien Registration Number (found on your permanent resident card/green card)
Federal tax information, tax documents, or tax returns:
- IRS Form 1040
- Foreign tax return or IRS Form 1040-NR
- Tax return for Puerto Rico, Guam, American Samoa, the U.S. Virgin Islands, the Marshall Islands, the Federated States of Micronesia, or Palau
Documentation of your non-taxable earnings, such as child support received, interest earnings, and non-education-related benefits for veterans (for both you and your parents if you’re dependent)
Information about your finances, such as savings, investments, and real estate

Signing, Submission, and Next Steps

After completing your FAFSA form, you’ll need to sign and submit it. Using your FSA ID to sign will usually ensure the fastest processing. You have the option to sign electronically or print it out, sign it, and mail it. Once submitted, you should see a confirmation page. If you provided an email address on your form, a confirmation will also be emailed to you. You can check the status of your application at fafsa.gov. Electronically submitted applications typically take three to five days to process, while mailed applications may take seven to ten days. There are a few possible statuses for your application, and some may require further action from you:

Processing — Your application is still being processed, and no additional action is needed at this time.
Processed Successfully — Your application has been processed successfully, and no further steps are required.
Missing Signatures — You forgot to sign your application and will need to go back and complete that step.
Action Required — If you see this status, you’ll need to contact your school to resolve the issue.

Receiving and Reviewing the SAR (Student Aid Report)

The SAR is a summary of the information you provided in your FAFSA application. You should receive this report within three days to three weeks after submitting your FAFSA. It’s crucial to review the SAR for any mistakes, which can be corrected online. Keep in mind that the SAR does not provide you with the amount of aid you will receive. It simply summarizes the information you submitted on your FAFSA application. Your SAR will also inform you if further verification is required. If necessary, provide the documentation requested by your school. Are you wondering about the differences between FAFSA and the SAR? FAFSA is the application form you need to fill out to apply for federal financial aid. Once you submit it, the information is processed, and you will receive the SAR, which is a summary of the data you provided in your FAFSA. Do you want to know when you can start filling out the FAFSA and when the deadline is? Usually, applications open on October 1st, and the deadline to submit your application is June 30th. If you didn’t qualify for college financial aid one year, should you still apply the next year? Absolutely! Financial situations can change, and the eligibility criteria might be different each year. It’s always recommended to apply annually to see if you qualify for aid. What happens if you miss the FAFSA deadline? Missing the federal deadline might make you ineligible for federal aid for that academic year. However, keep in mind that states and colleges have their own deadlines, so you might still be eligible for non-federal aid. Are there any alternatives to FAFSA for financial aid? While FAFSA is the primary application for federal student aid, there are other options to explore. You can look into scholarships, state-specific financial aid programs, and private loans as alternatives or supplements to FAFSA-based aid. What sets Federal Direct Subsidized Loans apart from other student loans? Federal Direct Subsidized Loans are need-based loans where the U.S. Department of Education pays the interest while you are in school at least half-time, during the grace period (usually the first six months after leaving school), and during any deferment periods. This is different from unsubsidized loans where you are responsible for all the interest that accrues from the time the loan is disbursed. The “subsidized” aspect of the loan is designed to help students with financial need afford higher education. How does school-based merit aid differ from federal loans or aid provided through FAFSA? School-based merit aid is awarded by individual colleges or universities based on your academic, artistic, or athletic achievements rather than financial need. If you’re looking for the best student loans, which are federal loans, it’s important to fill out your FAFSA before the financial aid deadlines. This applies to both dependent and independent students. Don’t worry if you’re not sure about your dependency status, just make sure to submit your application on time. If you miss the deadline, you’ll have to wait until the next academic year to access government funding for your education. Remember, if you’re ever struggling to manage your student loan debt in the future, you have the option to refinance. Additionally, it’s crucial to educate yourself about student loan forgiveness and awareness of scams. To expand your knowledge on these topics and more, check out Pachyy’s informative blogs! For additional resources and information, consider the following references:

For detailed information on types of financial aid, such as loans, grants, and work-study programs, visit the official U.S. Department of Education website:

Stay informed about recent developments:

The FAFSA Simplification Act | U.S. Congress

Take charge of your FAFSA application: