Start with the FAFSA, not the loan itself

Federal student loans begin with the Free Application for Federal Student Aid (FAFSA), not a separate loan form. The FAFSA is a single application that determines what federal aid you can receive — grants, work-study, and loans. You fill it out once per academic year, and the Department of Education uses your answers to calculate how much you and your family are expected to contribute. The difference between that amount and your school's cost of attendance is what federal loans can cover.

You cannot skip the FAFSA and go straight to borrowing. Schools use your FAFSA results to build your financial aid package, which tells you how much in loans the school is offering you. If you do not complete the FAFSA, you have no federal loan offer to accept.

The FAFSA opens on October 1 each year for the following academic year. For example, the 2024–2025 FAFSA opened October 1, 2023, and covers the school year starting fall 2024. Most schools have priority deadline dates — usually in January or February — after which aid packages may be smaller or loans may have less favorable terms. Check your school's financial aid website for its specific deadline.

Key Takeaways

  • Complete the FAFSA at fafsa.gov using your Social Security number, tax information, and school codes; it is free and takes 20 to 30 minutes.
  • After you submit the FAFSA, the Department of Education sends you a Student Aid Report (SAR) showing your Expected Family Contribution, which your school uses to build your aid package.
  • Your school will send you a financial aid package listing the loans they are offering; you accept or decline each loan separately through your school's financial aid portal.
  • Federal loans require you to complete entrance counseling and sign a Master Promissory Note (MPN) before money is disbursed to your school account.
  • Loan money is sent to your school first to cover tuition and fees; any remainder is refunded to you, usually by check or direct deposit.

Gathering documents and information before you start

Have these items ready before you open the FAFSA:

  • Your Social Security number
  • Your driver's license or state ID (not required, but speeds up verification)
  • Your most recent tax return (your own if you filed one, or your parents' if you are a dependent)
  • W-2 forms or other income records if your tax return is not yet filed
  • Records of untaxed income (Social Security, veterans benefits, child support received)
  • The Federal School Code for each school you are considering — find this on the school's financial aid website or at the Federal School Code search tool

If you are a dependent student, you will need one parent's information as well. The FAFSA asks which parent to report; if parents are divorced or separated, you report the parent you lived with most in the past 12 months.

If your parents' tax return is not yet filed, you can estimate income on the FAFSA and update it later. The Department of Education will match your FAFSA data against actual tax records filed with the IRS, and if there is a mismatch, your school will ask you to correct it.

Completing and submitting the FAFSA

Go to fafsa.gov — this is the only official FAFSA website. Do not use any other site; scams exist that mimic the real FAFSA page. Create a login using your email address, or use your existing Federal Student Aid (FSA) ID if you have one from a previous year.

The FAFSA has six sections: your personal information, school selection, financial information, family information (if dependent), dependency status questions, and sign-and-submit. You can save your progress and return later; you do not have to finish in one sitting. Most people complete it in 20 to 30 minutes.

Answer each question as accurately as you can. If you are unsure about a question, the FAFSA has help text for every field. Do not leave questions blank unless the form tells you they are optional — blank answers can delay processing.

When you reach the school selection section, enter the Federal School Codes for the schools you want to attend. You can list up to 10 schools. The Department of Education will send your FAFSA results to each school you name.

At the end, you will sign your FAFSA electronically using your FSA ID. If you are a dependent, one parent must also sign. Submit the form. You will see a confirmation page with a submission date and time.

What happens after you submit: the Student Aid Report and your school's response

Within three days of submitting, you will receive an email confirmation. Within one to three weeks, the Department of Education sends you a Student Aid Report (SAR) — a summary of the information you reported and your Expected Family Contribution (EFC), now called the Student Aid Index (SAI). This number tells your school how much you and your family are expected to pay out of pocket.

Your school subtracts your SAI from its cost of attendance to determine how much federal aid you need. This is the basis of your financial aid package.

Each school you listed will receive your FAFSA data and build a financial aid package for you. You will receive this package through your school's financial aid portal, by email, or by mail — timing varies by school, but most send packages by late March or early April. The package lists grants (money you do not repay), work-study, and loans (money you do repay with interest).

If your FAFSA information does not match IRS tax records, your school will flag this as a verification issue and ask you to submit documents proving your income. This does not delay your entire package — your school can offer you aid while verification is pending — but it may delay loan disbursement.

Accepting or declining the loans your school offers

Your financial aid package lists specific loans with specific amounts. You do not accept or decline the entire package as one unit. Instead, you accept or decline each loan separately through your school's financial aid portal or by signing a paper form your school provides.

Federal undergraduate loans typically include Direct Subsidized Loans (the government pays interest while you are in school) and Direct Unsubsidized Loans (interest accrues from the day the loan is disbursed). Your school may also offer Direct PLUS Loans if you are a graduate student or if your parents are borrowing on your behalf.

You can accept the full amount, accept a smaller amount, or decline a loan entirely. If you decline a loan, you cannot later ask for it without reapplying. If you accept a loan and later change your mind, you have 14 calendar days from the date your school notifies you of the loan to cancel it and have the funds returned.

Log into your school's financial aid portal — usually called the student portal, my.school.edu, or similar — and look for a section labeled "Financial Aid," "Aid Package," or "Loans." You will see a list of loans offered. Click to accept or decline each one. Some schools allow you to adjust the amount you accept; others require you to accept the full amount or none.

Entrance counseling and the Master Promissory Note

Before your school can disburse loan money, you must complete entrance counseling — a short online course explaining how federal loans work, what your repayment obligations are, and what happens if you default. This is required by federal law and takes about 30 minutes. Your school will send you a link to the counseling, usually through your financial aid portal or by email.

You must also sign a Master Promissory Note (MPN), a legal document in which you promise to repay the loan and agree to the loan terms. You sign this once, and it covers all federal loans you take out at that school for up to 10 years. If you are borrowing PLUS Loans as a parent, you sign a separate parent PLUS MPN.

Your school will provide a link to complete both the entrance counseling and MPN through the Federal Student Aid website or through your school's portal. You do not mail anything; everything is done online. Once you complete both, your school can disburse your loan.

How loan money reaches your account

Loan funds are sent to your school, not to you directly. Your school applies the money to your tuition, fees, and other charges billed to your student account. If there is money left over after those charges are paid, your school refunds the remainder to you.

Refunds are usually issued by check mailed to your address on file, or by direct deposit to a bank account you provide to your school. Timing varies — some schools refund within days of disbursement, others within weeks. Check your school's financial aid website or ask your financial aid office when to expect your refund.

Loans are typically disbursed twice per academic year — once for fall semester and once for spring semester. Some schools disburse more frequently. Your school's financial aid office can tell you the exact disbursement dates.

What to do if something goes wrong or changes

If your financial situation changes after you submit the FAFSA — you lose a job, your parents' income drops, or you have an unusual expense — contact your school's financial aid office. Many schools have a professional judgment process that allows them to adjust your aid package based on changed circumstances. This is not automatic; you must ask and provide documentation of the change.

If you made an error on your FAFSA, you can correct it by logging back into fafsa.gov, making the change, and resubmitting. Your school will receive the updated information. If you submitted the FAFSA to the wrong schools by mistake, you can add or remove schools at any time.

If you are not offered enough loan money to cover your costs, ask your school's financial aid office whether you can borrow more. Some schools allow you to request an increase; others have set maximum amounts based on your year in school. Your school can also discuss private student loans as an alternative, though these have different terms and protections than federal loans.

Frequently Asked Questions

Do I have to borrow federal loans if I am offered them?

No. You can decline any or all loans offered in your financial aid package. Declining a loan does not affect grants or work-study. However, if you decline and later need the money, you cannot get that loan back without reapplying through your school.

What if I do not know my parents' tax information yet?

You can estimate on the FAFSA and correct it later. The Department of Education matches your FAFSA against IRS records automatically. If there is a mismatch, your school will ask you to update your FAFSA. Estimated income does not delay your aid package.

Can I use federal loans to pay for living expenses, not just tuition?

Yes. Your school's cost of attendance includes tuition, fees, room and board, books, transportation, and personal expenses. Loan money can be used for any of these. Your school calculates how much total aid you need based on this full cost.

What happens if I do not complete entrance counseling or sign the MPN?

Your school cannot disburse the loan. You will not receive the money until both are done. Your school will remind you, but it is your responsibility to complete them. Do not wait until the last minute.

Can I change my mind about a loan after I accept it?

Yes, but only within 14 calendar days of your school notifying you of the loan. After that window closes, you are committed to the loan. If you need to cancel after 14 days, you must contact your school's financial aid office to discuss your options.