It is relatively common knowledge that the FAFSA is the gateway to college funding. FAFSA is the most important document you will complete in your endeavors to receive financial aid for college. The FAFSA establishes an estimate of how much money or what types of aid you should be eligible to receive for your schooling. This is calculated based on your estimated family contribution (EFC), which is how much money, according to family income, you should be able to put toward your education. The amount that you cannot personally afford is what FAFSA and financial aid takes care of for you, via education loans and grants. For some added comfort, it is helpful to know that your cost of attendance (COA) is taken into account, which is how much your university charges for you to attend. Please refer to the FAFSA section of the website for detailed information on obtaining an application and how to file the document.
If you have already filed your paperwork and are eagerly awaiting your award letter, the following should help you to understand how your FAFSA money will be handled and disbursed.
First, understand that the award letter you receive from FAFSA is an estimate. You will receive your estimated award letter 6-8 weeks after submitting your application. This estimate indicates what you are eligible for, based on the information you provided, not your actual FAFSA money. FAFSA may indicate that you are eligible for a Pell grant in a certain amount, for example. Your financial aid award is determined by the school you will be attending and their financial aid offices. While FAFSA could estimate $2,000 per semester for the above-mentioned grant, your university may only approve $1,500 of this. The same principle applies to all other government grants and loans. In turn, you will receive another document, this time from your university’s financial aid office, which outlines what you will receive in aid, should you accept it. If you accept, simply sign the form and mail it to your school.
Having a better understanding of the aid process, you may wonder how this money is going to get to you and how you are going to be able to use it. The simple answer is that your university handles this. When you become a student, there is an account created in your name for various purposes. One of those purposes is funding. You will not receive a check in the mail. The financial aid that is approved for you will be deposited into your student account. From there, your school will draw from that account to cover part of your tuition costs and any other associated fees (lab courses and sometimes textbooks, for example). If it happens that you have an excess of funds, a refund may be awarded to you.
Keep in mind that your financial aid award amount also depends on your enrollment status at your university. To receive maximum funding, remember that at most schools “Full-time” status equates to 12 credit hours, or 4 courses per semester.