Is the FAFSA a Loan or Free Money? The FAFSA application is not a loan. It is simply an application that you fill out in order to determine your eligibility for receiving a federal loan. There are three main types of financial aid that a student may be deemed eligible for after completing a FAFSA application.

Can you get FAFSA if you owe student loans?

If you’re in default on your student loans, you will not be able to receive any financial aid. You can get your student loans out of default by either rehabilitating your loans or by consolidating your loans. Once your loans are consolidated, you can receive financial aid.

Do you have to pay for FAFSA if you apply for college?

No. The Free Application for Federal Student Aid (FAFSA) is the first step in applying for student financial aid from the federal government, from the state government and from many colleges. You would have to take additional steps before you could be held responsible for repaying education loans.

What do you need to know about the FAFSA application?

The U.S. Department of Education uses the FAFSA application to determine a student’s eligibility for need-based federal financial aid for college based upon their financial situation. Federal financial aid may include federal grants, scholarships, work-study, and/or loans. Is the FAFSA a Loan or Free Money? The FAFSA application is not a loan.

What happens if you file FAFSA but get no aid?

Being in federal student loan default could mean you’re ineligible to receive additional federal student loans. If this is the case, contact your financial aid office and your student loan servicer, they can help guide you back to good standing. Some students will file the FAFSA, but won’t qualify for need-based student aid such as:

Is the Federal Student Loan program the same as financial aid?

A copy of this article has been sent to your email. Many students believe receiving grants and scholarships are considered true financial aid. However, student loans are also considered financial aid because the loan terms offered to students in the federal student loan program tend to be the most borrower-friendly.