The application process depends on the type of loan you need
Federal student loans are processed through the Free Application for Federal Student Aid (FAFSA), which you submit online at fafsa.gov. Private student loans come directly from banks, credit unions, and online lenders — you apply to each one separately through their websites. The FAFSA is the starting point for most borrowers because it determines your may be able to access for federal loans, which typically have lower interest rates and more flexible repayment terms than private options.
Your school's financial aid office uses your FAFSA results to build a financial aid package that may include federal loans, grants, and work-study. You do not apply to your school separately for federal loans — the FAFSA connects you to them. Private loans, by contrast, require you to find the lender yourself and complete their individual application.
Key Takeaways
- Federal student loans require you to complete the FAFSA at fafsa.gov, which your school's financial aid office uses to determine what you can borrow.
- Private student loans are issued by banks and online lenders, and you must apply to each lender separately through their own website or application.
- Your school's financial aid office will contact you with a financial aid package after processing your FAFSA results, usually several weeks before classes begin.
- You can borrow federal loans without a credit check, but private lenders will review your credit history and may require a cosigner if your score is low.
- Submitting the FAFSA does not obligate you to take out loans — you can accept only grants or work-study if those are offered to you.
How to complete the FAFSA for federal loans
Go to fafsa.gov and create a login using your email address. You will need your Social Security number, date of birth, and driver's license number (or state ID). Gather your most recent tax return and W-2 forms, or your parents' if you are a dependent student — the form asks for income and tax information to calculate how much you are expected to contribute toward your education.
The FAFSA takes 20 to 30 minutes to complete. You will list the schools you want to attend, and the Department of Education will send your results to their financial aid offices. After you submit, you receive a Student Aid Report (SAR) that shows the information you entered and your Expected Family Contribution (EFC) — the amount the government calculates you should be able to pay. Your school uses this number to determine your financial need and build your aid package.
Submit the FAFSA as early as possible in the year you plan to attend school. Some federal loans and grants are distributed on a first-come, first-served basis, so earlier submission can mean access to more funding. The deadline varies by state and school, but many schools have priority deadlines in February or March for the following fall semester.
Applying for private student loans
Private lenders include banks (such as Wells Fargo, Bank of America), credit unions, and online lenders (such as Earnin, Sallie Mae, and LendingClub). Each has its own application process, interest rates, and terms. Start by comparing lenders on sites that list multiple options, or go directly to a lender's website to see their rates and requirements.
When you apply, the lender will pull your credit report and ask for income information. If your credit score is low or you have no credit history, many lenders allow you to add a cosigner — typically a parent or relative with stronger credit — who becomes legally responsible for the loan if you do not pay. Some lenders offer loans without a cosigner, but the interest rate will be higher.
Private loan applications typically take one to three business days to process. Once approved, the lender sends funds directly to your school, which applies them to tuition, fees, and room and board. Any leftover money is usually returned to you as a check or direct deposit.
What happens after you submit your FAFSA
Your school's financial aid office reviews your FAFSA results and creates a financial aid package showing all the money you may receive. This package typically includes federal loans (Stafford loans for undergraduates, PLUS loans for parents or graduate students), grants, and work-study. The school sends this package to you by mail or email, usually several weeks before the semester begins.
You do not have to accept all the loans offered. You can choose to take only grants, only work-study, or a combination. If you decline a loan, notify your financial aid office in writing or through their online portal. Declining a loan does not affect your other aid.
If you accept a federal loan, you must complete entrance counseling — a short online course explaining how loans work, your repayment obligations, and what happens if you default. Your school will direct you to this after you accept the loan.
Comparing federal and private loan applications
| Feature | Federal Loans (FAFSA) | Private Loans |
|---|---|---|
| Where to apply | fafsa.gov | Individual lender websites |
| Credit check required | No | Yes |
| Cosigner option | Not available | Often available |
| Processing time | 2 to 4 weeks | 1 to 3 business days |
| Interest rate type | Fixed (set by Congress) | Fixed or variable (set by lender) |
| Repayment plan options | Multiple income-driven plans | Limited; varies by lender |
What to do if you are denied or need more money
If a private lender denies your application, you can apply to other lenders or ask a cosigner to apply with you. Some lenders specialize in borrowers with limited credit history or lower credit scores. If you are denied by multiple private lenders, focus on federal loans through the FAFSA, which do not require a credit check.
If your FAFSA results show you do not may have access to for enough federal loans to cover your costs, you can borrow additional private loans. You can also contact your school's financial aid office to ask about other funding sources — some schools have emergency funds, scholarships, or payment plans for students in financial hardship.
If you have already borrowed the federal loan maximum for your grade level, private loans are your only option for additional borrowing. Federal loan limits are set by law and vary depending on whether you are a dependent or independent student and what year of school you are in.
Frequently Asked Questions
Do I have to fill out the FAFSA even if I think I will not get aid?
Yes. Many students whose families earn too much for grants still may have access to for federal loans, which do not have income limits. Additionally, some schools require the FAFSA to determine merit scholarships or institutional aid. Submitting the FAFSA costs nothing and takes 20 to 30 minutes.
Can I apply for private loans before submitting the FAFSA?
Yes, you can apply for private loans at any time. However, most financial advisors recommend exhausting federal loan options first, since federal loans typically have lower interest rates and more flexible repayment terms. Private loans are best used to cover costs after federal loans run out.
What if my school is not on the FAFSA list?
Nearly all accredited schools that offer federal aid are listed on fafsa.gov. If your school does not appear, contact the school's financial aid office to confirm it is accredited and may be able to access for federal aid. If it is not, you can only borrow private student loans.
How long does it take to hear back after applying?
The FAFSA typically processes within two to four weeks, though it can be faster. Your school's financial aid office may contact you sooner if they need additional information. Private lenders usually respond within one to three business days, and some provide instant decisions online.
Can I change my mind after accepting a loan?
Yes. You can decline or reduce a federal loan by contacting your school's financial aid office before the semester begins. For private loans, check your lender's cancellation policy — most allow you to cancel within a short window (often three to 14 days) after the loan is disbursed.