July 09, 2025 · Budget, Education, Investment, Savings

A Brief Overview of FAFSA® for College Loans—Part 1

Four college students sitting on a front lawn of a college campus building

Attending college is an educational aspiration for many Americans regardless of their age. But the cost of going to an institution of higher learning increases almost every year, and it can be financially unattainable for many who dream of earning a college degree.

Fortunately, for many in need of money for college, there are numerous options of both private and public sources for financial aid. One essential source of college funding for millions of students is through the U.S. government and its Free Application for Federal Student Aid® (FAFSA®), which is explored below.

Because of the extensive amount of information involved with FAFSA®—and because the information is dynamic; it can evolve significantly from year to year (or even more frequently)—this blog post attempts to be current as of the month it was published, and this post is also not comprehensive.

This post selectively walks through only some of the early steps of the FAFSA® application process, including creating an account, gathering the right information and starting the FAFSA® form online. It is recommended for those interested in applying for FAFSA® that they visit its website and carefully, thoroughly and thoughtfully review the authoritative details it provides before taking any action regarding the form.

What is FAFSA® and how can it help a student attend college?

Before digging into the many details of FAFSA®, here’s a little bit of context on where it comes from—the Office of Federal Student Aid (FSA), which is one part of the federal agency the U.S. Department of Education. According the office’s website, it is the largest provider of student financial aid in the nation and helps make college education possible for more than 10 million students each year.

Federal Student Aid manages student financial assistance programs that provide grant, work-study, and loan funds to students attending college or career school. It also oversees the FAFSA® form and processes more than 17.6 million of these forms each year.

The FAFSA® allows students to apply for several sources of federally funded financial aid, even if students think they or their parents earn too much money to qualify for financial aid. The FAFSA® determines whether students are eligible for federal loans, grants or work-study programs; and many colleges also require the FAFSA® for need- and merit-based aid packages.

Admissions policies vary widely across colleges and universities. While it’s not guaranteed—or even common—some schools may give admission preference to students who submitted a FAFSA® form and listed their institution, as it can signal serious interest in attending.

Before learning more about FAFSA®, cautiously consider avoiding any website that attempts to charge you for completing the form. Applying on the government site is free, and the Federal Student Aid FAFSA® site is supposed to contain all the information, tips, tools and links to other resources needed to successfully complete the application. If a website asks you to pay to fill the application out, then it’s not the official FAFSA® site. One clue to look out for is that since the form is a U.S. government application, FSA, FAFSA® and their related sites will have a website name ending in .gov.

Considering and making the decision to apply for FAFSA®

Filing the FAFSA® will determine if you are eligible for low-interest and forgivable federal student loans, as well as for federal grants that do not have to be repaid. This information may be useful even if you do not plan to borrow money to go to school, since the FAFSA® can provide these details to schools so they can figure out whether you qualify for any state grants.

In case a borrower is concerned about costs and obligations for using FAFSA®, the form is free to complete, and filing it does not require the prospective borrower to accept any loans that are awarded from schools.

To see a preliminary calculation of your eligibility for financial aid, you can go to the U.S. Department of Education’s Federal Student Aid Estimator calculator. Student Federal Aid says the calculator can assist potential applicants in understanding “their options for paying for college or career school by providing them an early estimate of how much federal student aid they may be eligible for.” For the calculation, the following details are needed:

  • A student’s financial and personal information.
  • The student’s parents' financial information, if applicable.
  • The student’s spouse’s financial information, if applicable

As another preliminary step, you can estimate how much money you and/or family members might want to borrow with a Net Price calculator that several schools offer. The net price will be the amount that a student needs to pay to attend a school institution in a single academic year after subtracting their scholarships and grants, financial assistance that does not have to be paid back. A net price calculator search tool for different colleges and universities is also available for determining approximate college costs.

You may also calculate your federal student loan repayment options with the Loan Simulator. This online tool helps estimate monthly student loan payments and choose the optimal loan repayment option for you. It can also help you decide whether to consolidate your student loans. Note that Loan Simulator can’t predict future payments with 100% accuracy; each borrower is unique and there are too many potential variables to consider, such as interest rates and delayed or interrupted payments. To make its predictions, the tool must make several assumptions as it calculates monthly repayment amounts.

When should a student apply for FAFSA®?

Generally, it is considered beneficial for applicants should fill out the FAFSA® as soon they decide to attend college, even if they have not made a final decision on a school. Completing the form early may provide a better chance for an applicant to receive additional need-based grants that are awarded in order of application.

Deadlines for the form submission have changed over time and are likely to continue evolving, so it is extremely important to check what the current deadlines are. Recently, the form needed to be submitted by late June, with any corrections or updates submitted by—approximately—the middle of September. Overall, there are three deadlines that need to checked: college, state and federal, and the FAFSA® site has some links and tools to help find that information. Selected schools and states may have earlier deadlines than FAFSA®. However, it’s still worthwhile to complete and file your FAFSA® even after the school year has started, because you are allowed to file FAFSA® late and, possibly, could even receive financial aid retroactively.

Some states and colleges use information from the FAFSA® form to determine your eligibility for their grants, scholarships and loans and they have their own unique deadlines. Missing a state deadline should not impact your eligibility for federal student aid, so it is important to still fill out your FAFSA® form even if your state deadline has passed. Federal Student Aid has a search tool titled “Check FAFSA® Deadlines for the State You Live in” for checking each state’s deadlines.

This wraps up Part 1 of the post on “A Brief Overview of FAFSA® for College Loans.” “A Brief Overview of FAFSA® for College Loans—Part 2” continues in a few weeks.

Curious about how to BALANCE™ your finances when budgeting for college and other major expenses?

BALANCE™ is a financial education and counseling organization that offers free services to Delta Community members. Some of its services include credit report reviews, debt management, and information on budgeting, money management and home buying.

Visit the BALANCE™ website to learn about their education and assistance programs. Members can also speak with certified credit and housing counselors to get personalized guidance.

Want to connect with a Financial Coach about your specific situation? Chat onlinee-mail, or call 1-888-456-2227 to speak with a Financial Coach today.

Note that the services offered through BALANCE™ are separate and distinct from any business conducted with Delta Community and are not guaranteed by, nor are they obligations of, the Credit Union.

Interested in a no-cost, ongoing, practical financial education?

For more information that may help manage both college and after college finances, check out the free Delta Community Financial Education Center webinars on a range of practical financial topics with actionable advice. You may visit the Financial Education Center's Events & Seminars page to register for its on-demand webinars.

There are more Delta Community blogs for college students and post-college workers: