Financial aid is really a complex process, and the acronyms and terms can be confusing. FAFSA, or even the Free Application for Federal Student Aid, is really a term that is thrown around often.
What is the FAFSA? Would you repay FAFSA? How do you know what educational funding you have to repay and that is truly “free money?”
These questions and more have been answered below. Let's join in!
What Is FAFSA?
The FAFSA is a form that you simply fill out to determine should you be eligible for a educational funding. In strict terms, the answer to “Do I pay back FAFSA?” is no, because FAFSA is not a loan. It is a document that can help the federal government figure out what loans you be eligible for a.
Once you submit the FAFSA, you'll get a document known as the Student Aid Report (SAR.) This can list your Expected Family Contribution (EFC) and help schools figure out what aid they would like to offer according to your financial need.
Some of the financial aid which comes through filling out the FAFSA does need to be repaid. Knowing the distinction between scholarships, loans, and grants is essential.
Which Kinds of Educational funding Don't need to Get paid Back?
It’s vital that you understand which kind of educational funding you have to pay back and that you simply don't. For instance, is it necessary to pay back scholarships or grants?
The terms grants and scholarships are utilized interchangeably. So, if you are interested in aid that you don't have to pay back, you need to concentrate on grants, scholarships, and work-study. These kinds of financial aid don't need to be paid back unless you leave school after you obtain the funds but before you attend classes.
Student loans, however, need to get paid back. There are lots of kinds of student education loans. Federal Subsidized loans don't accrue interest while you're in class. Federal Unsubsidized loans do accrue interest during school. Both do not need to get paid back until after you leave school.
Your family could also choose to consider private student education loans or parent loans. You will want to investigate these carefully to make sure you understand interest rates, fees, and repayment options.
How Outside Scholarships Affect Financial Aid
If you have in mind focusing on money you don't have to pay back, you might seem like it's wise to pursue lots of private scholarships. These can range from $100 to a couple thousand dollars, and can be highly competitive.
However, keep in mind that at many schools having outside scholarships reduces the financial aid you obtain, because it reduces your financial need. Usually schools will reduce the aid you have to pay back first, such as loans.
Sometimes, though, it may change up the scholarships and grants that the school will offer. Be sure to contact the financial aid office of the top options to learn about their policies before you put a lot of effort into pursuing private scholarships.
FAFSA Is not a Guarantee
Filling the FAFSA isn't a guarantee that you will get money from the school. It is a way for the federal government to collect financial information to determine how much your family should be expected to pay toward your education.
As a result, don't think about this as “Do we must repay FAFSA.” Instead, concentrate on the quantity of loans, grants, and scholarships that every school offers. Compare the financial aid awards depending on how much aid is provided and just how much you have to pay back.
One method to minimize your costs and assist the response to “What educational funding must i pay back” be more reasonable would be to concentrate on schools which are generous. Many schools are recognized to provide a lot of aid in the form of scholarships, grants, and work-study.
Are you curious what schools those would be? Spending hundreds of hours digging up the data is one method to find out. But even so you may miss something.
Instead, take a look at our College Insights tool. We can assist you to identify the schools that are a great match for you personally financially, which gives you a great starting place when it comes to affording college.