If you’re planning to go to college, how you’re going to pay for it likely is a major concern.
Luckily, federal financial aid can help make school more affordable. In order to receive it, however, you first need to complete the Free Application for Federal Student Aid (FAFSA).
Unfortunately, many people skip the FAFSA. According to the National College Access Network, only 61% of high school seniors complete the FAFSA by graduation. That’s a costly mistake. You could lose out on thousands of dollars in student aid if you don’t fill out the FAFSA.
There are many myths about the FAFSA that prevent people from completing it. Here are 10 of the biggest as well as what you need to know about the application.
1. My parents make too much money for me to qualify for aid
Many families skip the FAFSA because they assume they make too much money to qualify for federal financial aid.
But there’s actually no income cutoff. The government takes into account several factors when determining your financial aid, including your family size and income and the cost of your school.
Even if you don’t qualify for federal grants, you could qualify for federal student loans. Federal loans usually are better than private loans because they have lower interest rates and more flexible repayment options.
2. The FAFSA is only for federal student aid
The federal government isn’t the only entity that uses the FAFSA to determine your financial aid options.
Your state government and your school also use it to decide if you’re eligible for grants and scholarships, even those that are based solely on merit.
If you skip the FAFSA, you might miss out on valuable aid.
3. The FAFSA is due in June
This myth is partially true. The federal deadline for the FAFSA is the end of June each year.
However, states and schools often have different FAFSA deadlines. Some can be much earlier. For example, if you live in Connecticut, your state deadline is Feb. 15.
4. I should wait until I receive an acceptance letter to fill out the FAFSA
Again, the earlier you submit your FAFSA, the better. Some financial aid is disbursed on a first-come, first-served basis, so getting your application in early ensures you get the most aid possible.
If you’re not sure where you’re going to go to school, that’s OK. Just list every school you’re considering on the FAFSA.
5. The FAFSA has an application fee
The FAFSA is free for everyone. There are no application or submission fees.
6. I can’t complete the FAFSA until I file my taxes
You don’t have to wait until your taxes are done to complete the FAFSA.
For the 2019-2020 school year, you can start filling out the FAFSA on Oct. 1, 2018. You can complete the FAFSA with last year’s tax information.
7. I don’t have to report income from a part-time job
One of the biggest myths is that students don’t have to report income from a part-time job, whether it’s a summer or on-campus gig.
However, that’s incorrect. If you receive a paycheck, you need to report that money on the FAFSA. The federal government takes it into account when determining your financial aid options.
Keep in mind that deliberately filling out the FAFSA incorrectly is a serious offense. If you receive federal aid based on false information, you’ll have to pay it back along with fines as high as $20,000. Plus, you could be sent to prison.
8. Only students with good grades get financial aid
Schools and private organizations often look at your grades when determining whether to offer you an academic scholarship. The government works differently.
To be eligible for federal financial aid, you have to show that you’re making sufficient progress toward completing your degree. However, you can do that with passing grades. You can qualify for federal grants and loans even if you’re a less-than-stellar student.
9. I need to complete the FAFSA only once
The first time you complete the FAFSA, you’ll likely be a high school senior filling it out for the upcoming school year. However, that doesn’t mean you’re done with the FAFSA once you submit it.
To qualify for federal financial aid throughout college, you need to submit a new FAFSA every year. If your information hasn’t changed, you can submit a renewal FAFSA, which populates the form with the prior year’s information, making it simpler and faster to complete.
10. If I don’t get enough aid, I’m out of luck
In some cases, you might not get enough federal financial aid to cover your school’s total cost of attendance. If that’s the case, you might feel helpless and wonder if your college career is coming to an end.
However, there are ways to fill the gap. One option is to apply for a private student loan. Private loans tend to have higher interest rates and fewer benefits than federal loans, but they can be a useful tool to pay for school if you’ve exhausted your other options.
If you decide to take out a student loan, compare offers from private lenders to ensure you get the lowest interest rate possible.
Get started submitting your FAFSA
Filling out and submitting your FAFSA is an important step toward going to college.
If you’re overwhelmed and don’t know where to start, don’t panic. Check out our complete guide to filling out the FAFSA for easy-to-follow guidance.
Need a student loan?Here are our top student loan lenders of 2019!
|1 Important Disclosures for Ascent.
Before taking out private student loans, you should explore and compare all financial aid alternatives, including grants, scholarships, and federal student loans and consider your future monthly payments and income. Applying with a cosigner may improve your chance of getting approved and could help you qualify for a lower interest rate. Ascent Student Loans may be funded by Richland State Bank (RSB). Ascent Student Loan products are subject to credit qualification, completion of a loan application, verification of application information and certification of loan amount by a participating school. Loan products may not be available in certain jurisdictions, and certain restrictions, limitations; and terms and conditions may apply. Ascent is a federally registered trademark of Turnstile Capital Management (TCM) and may be used by RSB under limited license. Richland State Bank is a federally registered service mark of Richland State Bank.
* Application times vary depending on the applicants ability to supply the necessary information for submission.
2 Important Disclosures for CollegeAve.
College Ave Student Loans products are made available through either Firstrust Bank, member FDIC or M.Y. Safra Bank, FSB, member FDIC. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply.
Information advertised valid as of 2/1/2019. Variable interest rates may increase after consummation.
3 Important Disclosures for Discover.
* The Sallie Mae partner referenced is not the creditor for these loans and is compensated by Sallie Mae for the referral of Smart Option Student Loan customers.
4 = Sallie Mae Disclaimer: Click here for important information. Terms, conditions and limitations apply.
5 Important Disclosures for SunTrust.
Before applying for a private student loan, SunTrust recommends comparing all financial aid alternatives including grants, scholarships, and both federal and private student loans. To view and compare the available features of SunTrust private student loans, visit https://www.suntrust.com/loans/student-loans/private.
Certain restrictions and limitations may apply. SunTrust Bank reserves the right to change or discontinue this loan program without notice. Availability of all loan programs is subject to approval under the SunTrust credit policy and other criteria and may not be available in certain jurisdictions.
SunTrust Bank, Member FDIC. ©2019 SunTrust Banks, Inc. SUNTRUST, the SunTrust logo and Custom Choice Loan are trademarks of SunTrust Banks, Inc. All rights reserved.
6 Important Disclosures for LendKey.
Additional terms and conditions apply. For more details see LendKey
7 Important Disclosures for CommonBond.
A government loan is made according to rules set by the U.S. Department of Education. Government loans have fixed interest rates, meaning that the interest rate on a government loan will never go up or down.
Government loans also permit borrowers in financial trouble to use certain options, such as income-based repayment, which may help some borrowers. Depending on the type of loan that you have, the government may discharge your loan if you die or become permanently disabled.
Depending on what type of government loan that you have, you may be eligible for loan forgiveness in exchange for performing certain types of public service. If you are an active-duty service member and you obtained your government loan before you were called to active duty, you are entitled to interest rate and repayment benefits for your loan.
A private student loan is not a government loan and is not regulated by the Department of Education. A private student loan is instead regulated like other consumer loans under both state and federal law and by the terms of the promissory note with your lender.
If your private student loan has a fixed interest rate, then that rate will never go up or down. If your private student loan has a variable interest rate, then that rate will vary depending on an index rate disclosed in your application. If the interest rate on the new private student loan is less than the interest rate on your government loans, your payments will be less if you refinance.
If you don’t pay a private student loan as agreed, the lender can refer your loan to a collection agency or sue you for the unpaid amount.
Remember also that like government loans, most private loans cannot be discharged if you file bankruptcy unless you can demonstrate that repayment of the loan would cause you an undue hardship. In most bankruptcy courts, proving undue hardship is very difficult for most borrowers.
8 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|4.23% – 13.23%1||Undergraduate and Graduate|
|4.20% – 11.44%2||Undergraduate, Graduate, and Parents|
|4.84% – 13.49%3||Undergraduate and Graduate|
|4.50% – 10.11%*,4||Undergraduate and Graduate|
|4.25% – 13.25%5||Undergraduate and Graduate|
|5.85% – 6.99%6||Undergraduate and Graduate|
|3.95% – 9.81%7||Undergraduate, Graduate, and Parents|
|4.45% – 12.42%8||Undergraduate, Graduate, and Parents|