At this point, most people know what FAFSA is and its importance when applying to American colleges. If you want to get any grants or loans for college that come directly from the federal government (rather than banks or other financial institutions), then you need to be all over the FAFSA website! Many families and students don’t have the means to pay for full tuition directly out of pocket because as we all know, college is incredibly expensive!
So, pay close attention to these deadlines for the 2020-2021 year because things have changed in a MAJOR way.
Why is FAFSA more important than ever before? What changed in 2020?
First of all, you’ll save a lot of money in interest fees if you borrow from the federal government now, compared to before 2020. Before COVID-19, the average student loan interest rate was about 5-6% per year. That’s an APR of 5% or 6% calculated yearly, charged monthly on your outstanding loan amount due. However, as part of the relief efforts rolled out to support Americans struggling during the time of high unemployment rates during this time, the federal government announced that all new federal student loans would be granted a 2.45% APR. That is incredibly low interest to pay! Lower than most people’s home mortgage loans, and certainly lower than credit cards or personal, auto and previous student loans!
In order to take advantage of these super low interest rates, you’ll need to demonstrate that you qualify for some sort of government aid. Unless your family is incredibly wealthy, you likely will qualify for some assistance, so you should never skip out on FAFSA just because you think you may not qualify for aid. Make sure to set aside 30-40 minutes to complete the application. The worst thing that can happen is that they inform you that you don’t qualify, but it’s still 100% worth a shot!
Important Deadline #1: October 1, 2019
We know that the date has already passed. BUT, don’t worry! It’s not too late yet. October 1, 2019 was just the first day for when the FAFSA application window opened. The thing is, the earlier you submit your application, the better. So, you should definitely fill out that FAFSA ASAP!
Important Deadline #2: June 30, 2021
You can submit the FAFSA for the 2020-2021 academic year up until June 30, 2021. It’s important to know that the application window closes at midnight Central Time, not whenever midnight is for you based on your time zone. Keep this in mind if you leave your application for the last minute!
But, I’m going to repeat this again for the people in the back and to all the procrastinators:
The earlier you submit your application, the better!
When you submit early, you’ll have a higher chance to get approved for borrowing federal financial aid at a low rate, if you qualify based on your family’s income. Think about it this way: the government creates a pot of money containing set amounts budgeted specifically for lending out to students. That pot of money funds various programs, including undergraduate, graduate and parent loans. The longer you wait, the less money will remain in that pot.
Common Mistakes To Avoid
Aside from waiting to the last minute to apply for federal student aid, what are some other common mistakes that students make year over year?
- Skipping the FAFSA entirely– Many students don’t even think about applying because they think they don’t qualify. As a result, so many people miss out on low cost loans and end up borrowing on credit or from a private lender at a much higher interest rate! Remember, it doesn’t really get any lower than 2.45% when it comes to borrowing money and not having a well-established credit history.
- Not double-checking your application before submitting– Be super careful and always go through your application at least twice. If you submit a form with mistakes, it will delay your funding as the application will get stuck in the system. You do not want that! The instructions and definitions are widely available online, so make sure to read and fully understand them before filling out your FAFSA.
- Googling “FAFSA” and applying to random application websites– DO NOT DO THIS! There is only one correct website for this application– fafsa.gov. This is getting increasingly important as new websites pop up everyday claiming to be FAFSA applications. Only the federal government processes FAFSA applications! And remember, you never have to pay money to fill it out, either! If you’re required to pay, take that as a huge red flag as you may be getting scammed by a fake website. If you come across fake websites, you can report it on the FAFSA website or the “myStudentAid” app on your phone.
Once you’ve avoided the mistakes discussed above, here are a few things to do if you’re feeling nervous about your application:
- Use the free resources online– Websites such as studentaid.gov, financialaidtoolkit.ed.gov and ngpf.org offer resources at no cost to help inform and guide you through the process.
- Speak to a representative– Sometimes, speaking to someone on the phone will provide you with the peace of mind you don’t get by reading online resources. The FSA Information Center provides answers to any questions or issues related to FAFSA. Their number is 1-800-4-FED-AID or 1-800-433-3243. It’s a toll-free hotline that is paid for by the Department of Education and millions of people call every year.
If you’ve read this far, then you know just how important this is in your life! This is a great time to dig in to some of the linked resources above and do more research. If you’ve found this helpful, consider sharing this link with your friends and family so you all can learn more together!