As a college student, one thing that always comes to your mind is the amount of money you are paying. It is scary when you see a high value, and you might think that you cannot afford it. Luckily, the University knows that some students struggle with their economic situation. That is why FAFSA can help you by giving you financial aid and paying your college debts.
These financial aids can range depending on your current economic situation. It is a form that you have to fill out so that government institutes study your case. After some time, they determine if you are eligible for it, but it is not guaranteed that you will get it.
So, if you are lucky to receive one, what comes next? Do I need to repay the money that the government gave me to pay my debts? You might want to know the answer if you are a student and looking for financial aid. We are going to present you with what you have to pay for FAFSA back and some facts that will be handy.
The Great Support of FAFSA
FAFSA actually stands for Free Application for Federal Student Aid, and it is a form rather than a financial aid instead. This document needs to be filled with information like income and tax records. You will have to support some documents and extra information too, but that will depend if you are going to do this process as:
- A student that wants access to the form
- A parent filling the form for a student
- Or a preparer helping a student to fill their form
Once you finally submitted your FAFSA form, through your email you will receive the Student Aid Report (SAR). This report contains information on a summary of your student loans, your Expected Family Contribution (EFC), and if you have been accepted for the aid.
You will also receive a Data Release Number (DRN) in case you need to change any information on your FAFSA form after submission.
Depending on the student loan that you obtain is what is going to determine if you have to pay it or not. However, another factor that varies your student loan is when you are going to submit the application.
Think about it, thousands of students use this opportunity to take a big piece of the amount you have to pay in your scholar year. For that reason, if you apply for FAFSA quickly, you will have more chances to receive better financial aid.
Starting on October 1st (Prior to the year of enrollment), you can start to file this document, and you have until June 30th of the academic year.
Classification of Financial Aids You Have To Pay
It is not easy to understand at first which aid you need to repay. When it comes to student loans, they are mandatory to be repaid in the period of time that you have. The types of loans that FAFSA offers are:
- Subsidized loans. These loans are very special since the government pays the interest of the loan. That way, it does not increase during your studies or your six-month grace period.
- Unsubsidized loans. On the other hand, these loans do not take into account the interests. Meaning that it will accumulate with the pass of time, but it has the same grace period as subsidized ones.
- Direct PLUS loans. Although these loans are unsubsidized, they are offered for graduate and professional students. On top of that, it has a fixed rate for everyone rather than different interest rates, and you require a credit check.
You may notice that we mentioned grace periods. These are the period of time that you have to repay your loans before you receive a penalty or you lose the loan completely. Of course, you can pay before the grace period starts, but if you take too long, your interest will accrue. You can count these grace periods after:
- You graduate
- Leave school
- Dropping below half-time enrollment
However, these periods can change depending on some factors. For example, if you have dropped out of school below half-time enrollment, and you decide to come back before the end of the grace period, you will still receive the rest of the grace period.
This information is all presented on the Federal Student Aid website, and you can visit it by clicking here. Of course, read carefully the SAR and ask about how much time you have left to pay these loans.
How About the Financial Aids That You do not Have to Pay?
Now that we have cleared the financial aid that you need to pay for FAFSA, let us talk about the ones you do not have to. These are common aids that colleges and the government offer. Still, the faster you apply for FAFSA, the better chances you will have to obtain them:
- Scholarships. These are given for exceptional students that have succeeded greatly in their academic year, or even as rewards from sports competitions. The amount covered will depend on the school.
- Grants. This is more based on the financial need of the applicant. They will study your financial situation and determine if you are eligible for it. These benefits normally are when the student is in an extreme condition that cannot afford to pay for the scholar year.
- Work-Study. In this category, you will also be examined on your financial need and other factors, and in return, you will be offered a part-time job. These can be jobs like receptionists or assistants.
Either way, it is better that you check the requirements and eligibility on their website.
Preparing for Paying Back FAFSA
If you got a scholarship or grant, you do not have to worry about paying FAFSA back. However, if you received a loan, then do not be scared, it is better that you take advantage of the help that they are providing you with.
As long as you are not late during the grace periods, you can keep applying for FAFSA the next year. Be sure to ask any questions to loan officers about the process or some payment options if needed.