Unlock the College Financial Aid You Need Starting Oct. 1

Despite the headlines, college is still the surest path toward better lifelong earnings. But a degree is far more likely to pay off if you haven’t borrowed a small fortune to get it.

The Free Application for Federal Student Aid, or FAFSA, is a key step in making college affordable. Applications for the 2023-24 school year open on Oct. 1, and those who apply early stand the best chance of getting more free money for school.

D. Jean Hester, who oversaw college enrollment and admissions at schools in Ohio and Oregon for over a decade, advises getting in line as quickly as you can. While the federal government doesn’t run out of money for need-based aid, colleges and states do.

“Do it this fall. There’s absolutely no reason to wait,” Hester says.

When you submit the FAFSA, you are applying for need-based aid that can make a big difference in where you decide to go to school and how much debt you’ll face after graduation. Every dollar you get in grants, scholarships and work-study is one you won’t have to beg from family or borrow.

Filing early also means you’ll get your financial aid offer from the colleges you apply to sooner, Hester notes, allowing you time to compare offers or resolve any discrepancies.

“It’s one of those things you just need to get out of the way,” she says.

Types of aid covered by the FAFSA

The FAFSA is used to calculate your family’s Expected Family Contribution, or EFC. Subtract the EFC from your school’s official cost of attendance to reveal your financial need; the completed FAFSA then serves as your application for financial aid to help fill that hole.

A completed FAFSA unlocks these types of need-based federal, state and school aid:

  • Pell Grants.
  • Work-study.
  • Scholarships.
  • Grants.

The current maximum Pell Grant award is $6,895; any combination of grants, work-study and scholarships can cover some or all of the difference between the school’s official cost of attendance and your family’s expected financial contribution.

The great thing: These types of aid don’t need to be repaid.

You also need to complete the FAFSA to access federal student loans.

Watch your student loan debt tally

After completing the FAFSA, you are likely to be offered subsidized federal loans as well; they are called financial aid because the government pays the interest on them until you graduate. But they must be repaid like any other loan.

The FAFSA also serves as the application for unsubsidized federal loans, which aren’t tied to need. For freshmen, the amount is capped at $5,500 a year, but that rises to $7,500 by junior year.

If you need to borrow money beyond that amount, you could get a private student loan.

Any loan — whether subsidized or unsubsidized or private — becomes part of the debt you’ll have to cope with once you graduate. A NerdWallet analysis suggests the high school class of 2022 could face an average debt of nearly $40,000 by the time they graduate college.

And while student loan news is currently focused on President Joe Biden’s recent cancellation announcement, the administration has made clear that this allowance is tied to COVID relief and won’t happen again.

Cecilia Clark writes for NerdWallet. Email: cclark@nerdwallet.com.

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Another $400 in Free College Aid Could Be Coming Your Way

College students could see their Pell Grant award go up by as much as $400 for the coming academic year, thanks to the federal spending bill signed into law March 15.

Congress raised the annual Pell Grant limit to $6,895 for the 2022-23 academic year as a part of the 2022 federal budget. That’s the largest increase to the Pell Grant since 2009.

“The $400 increase to the maximum Pell Grant — the largest increase in 10 years — is a pivotal and much-needed investment in making college affordable for today’s students,” Mamie Voight, CEO and president of the Institute for Higher Education Policy, said in a statement. Nearly 7 million students receive Pell Grants each year, Voight said, and many are minority students.

Pell-eligible students who have already received financial aid award letters for the 2022-23 academic year will likely be sent revised letters, according to Karen McCarthy, the vice president of public policy and federal relations for the National Association of Student Financial Aid Administrators, or NASFAA. The increase will be reflected in any financial aid award letters that haven’t been sent yet.

More for Pell Grants, work-study and PSLF

The boost in funding will affect more than just the students receiving the maximum Pell Grant. The law expands eligibility and increases award amounts, according to McCarthy.

The federal budget also includes an increase in funding for the federal work-study program. Students could see higher award amounts, and more students could become eligible for work-study, but these changes are not guaranteed, according to McCarthy.

Although the final budget doesn’t contain as much support for students as the original proposal, it does increase higher education funding beyond Pell and work-study. Minority-serving institutions, or MSIs, will receive increased funding compared with last year’s budget, and programs intended to help disadvantaged students attain a higher education also will see a boost to funding.

Money is also being allocated to the Department of Education to further expand eligibility for Public Service Loan Forgiveness, or PSLF. The Department expanded eligibility for PSLF with a temporary waiver, which goes through October of this year; this funding will allow the program to include more borrowers whose previous payments had been ruled ineligible.

Submit the FAFSA to be eligible for aid

In order to be considered for any federal student aid, including the Pell Grant and work-study, you need to submit the Free Application for Federal Student Aid, or FAFSA. Submitting the FAFSA makes you eligible to receive grants, scholarships, loans, and other state-based aid.

Submit the FAFSA even if you’re just considering attaining a higher education. Doing so will give you an idea of how much aid you’ll receive if you end up enrolling; you’re not obligated to accept the aid if you decide not to go to college.

The Pell Grant, like scholarships and work-study, is a form of aid that you don’t have to repay. Eligibility for the grant is determined by your expected family contribution as well as the cost of attending the school you’re considering.

Take advantage of aid you don’t have to repay before accepting any federal loans or aid that you have to pay back. If you must use loans to pay for your education, exhaust all federal loans available to you before applying for private student loans.

Colin Beresford writes for NerdWallet. Email: cberesford@nerdwallet.com.

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You Can Get Free Money for College — and Help Finding It

If you’re considering going to college this fall — or next — there is one way to ensure you’re considered for as much free money as possible: by submitting the Free Application for Federal Student Aid, or FAFSA.

Completing the FAFSA makes you eligible for federal, state and some school-based aid, including loans, scholarships and grants. But for many students and families, it can be challenging and time-consuming to fill out the application, and the pandemic only added to that burden.

As of mid-August, 57% of the 2021 high school class had completed the FAFSA, a 4.3% decline compared with this time last year, according to estimates from the National College Attainment Network. Including both the class of 2020 and 2021, NCAN estimates that through the pandemic, over a quarter-million fewer students completed the FAFSA.

“We’ve seen disproportionate declines in high schools that are educating more students of color and more students from low-income backgrounds,” says Bill DeBaun, director of data and evaluation at NCAN. “For those students, the pathway to college has never been easy … and these students often need assistance.”

Various circumstances played into the decline in FAFSA applications, some of which were a result of students not wanting to go to college during the pandemic. Those factors include:

  • Students became disconnected from support networks: Support from community organizations and high school counselors went virtual, limiting its reach.
  • FAFSA completion became less of a priority: Filling out the FAFSA and enrolling in college were put on the back burner during the pandemic, particularly due to the increase in economic, job and food insecurity, says DeBaun.
  • Interest in going to college decreased while classes were online: Knowing that college classes were completely online kept some students from filling out the FAFSA and enrolling.

Where to find help to fill out the FAFSA

Completing the FAFSA can be a confusing process, particularly if you’re the first in your family to do so. But for students who have questions or want help filling out the FAFSA, there are resources — and often, they’re free.

» MORE: FAFSA checklist

“For high school seniors, there’s help out there. You have to ask for it and sometimes look for it, but there are organizations in communities that want to help students get this money for college,” says Traci Lanier, vice president of external affairs at 10,000 Degrees, a college access organization that supports students before and after enrolling in college. “Just get [the FAFSA] in because it’s free money and you don’t want to leave money on the table.”

College access community-based organizations

College access community-based organizations work to help students reach college, and that process includes filling out the FAFSA. Support is often offered at FAFSA completion events, where you can ask questions and make sure you’re filling out the application correctly, or through individual advising.

If there isn’t a college access organization hosting in-person events in your community, many offer online resources to help guide you.

Financial aid offices

Besides a community-based organization, “the best place for students to go is the higher education institution they want to enroll at,” says Maggie McGrath, director at College Now Greater Cleveland. “The financial aid office has people on staff that are ready to help walk them through [completing the FAFSA]. They know all of the ins and outs.”

In some cases, the financial aid office can point you to a local college access organization if you can’t find one, says Lanier. And although the FAFSA is best submitted early, it can be completed up to the time classes start, and sometimes after that, depending on the institution.

The Federal Student Aid Information Center

The Department of Education offers help completing the FAFSA through the Federal Student Aid Information Center. The Center offers live chats as well as phone support if you have questions on any part of the application.

Why you should fill out the FAFSA

The FAFSA is your ticket to being considered for federal financial aid, including aid you don’t have to repay, like scholarships and grants. And although fall classes have begun or are set to begin soon, it’s not too late for eligible applicants to receive aid such as the Pell Grant — need-based federal financial aid — for the 2021-22 academic year, says DeBaun.

For those looking to enroll in college in 2022, it’s important to submit the FAFSA as soon as possible because many colleges award aid on a first-come, first-served basis. For the 2022-23 award year, the FAFSA filing period opens on Oct. 1.

When deciding how to pay for college, first exhaust all free money offered to you before accepting loans. If you need to take out loans, use any federal loans that are offered to you before taking out private student loans.

Colin Beresford writes for NerdWallet. Email: cberesford@nerdwallet.com.

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6 Things to Know About Student Loans Before You Start School

The summer before your freshman year in college means choosing classes, checking out your future roommate’s Instagram and figuring out how you’re going to pay the bills.

Chances are you will need a loan: 2 out of 3 students have debt when they leave school, according to 2017 graduate data from the Institute for College Access and Success. But consider a loan after you’ve accepted grants, scholarships and work-study. You can get these by submitting the Free Application for Federal Student Aid, or FAFSA.

Here are six things you need to know about getting your first student loan.

1. Opt for federal loans before private ones

There are two main loan types: federal and private. Get federal loans first by completing the FAFSA. They’re preferable because you don’t need credit history to qualify, and federal loans have income-driven repayment plans and forgiveness that private loans don’t.

You may be offered two types of federal loans: unsubsidized and subsidized. Subsidized loans — for students with financial need — don’t build interest while you’re in school. Unsubsidized loans do.

Take a private loan only after maxing out federal aid.

2. Borrow only what you need — and can reasonably repay

Undergraduate students can borrow up to $12,500 annually and $57,500 total in federal student loans. Private loan borrowers are limited to the cost of attendance — tuition, fees, room, board, books, transportation and personal expenses — minus financial aid that you don’t have to pay back.

Aim to borrow an amount that will keep your payments at around 10% of your projected after-tax monthly income. If you expect to earn an annual salary of $50,000, your student loan payments shouldn’t be over $279 a month, which means you can borrow about $26,000 at current rates.

To find future earnings, look up average salaries in the U.S. Department of Labor’s Occupation Outlook Handbook. Then, use a student loan affordability calculator to estimate payments.

Your school should provide instruction on accepting and rejecting financial aid in your award letter. If you’re not sure how to do it, contact your financial aid office.

“We’re not scary people,” says Jill Rayner, director of financial aid at the University of North Georgia in Dahlonega, Georgia. “We really do want students and families to come in and talk with us so we can help strategize with them.”

3. You’ll pay fees and interest on the loan

You’re going to owe more than the amount you borrowed due to loan fees and interest.

Federal loans all require that you pay a loan fee, or a percentage of the total loan amount. The current loan fee for direct student loans for undergraduates is 1.062%.

You’ll also pay interest that accrues daily on your loan and will be added to the total amount you owe when repayment begins. Federal undergraduate loans currently have a 5.05% fixed rate, but it changes each year. Private lenders will use your or your co-signer’s credit history to determine your rate.

4. After you agree to the loan, your school will handle the rest

Your loan will be paid out to the school after you sign a master promissory note agreeing to repay.

“All the money is going to be sent through and processed through the financial aid office — whether it’s a federal loan or a private loan — and applied to the student’s account,” says Joseph Cooper, director of the Student Financial Services Center at Michigan Technical University in Houghton, Michigan. Then, students are refunded leftover money to use for other expenses.

5. You can use loan money only for certain things

Loan money can be used for education-related expenses only.

“You cannot use it to buy a car,” says Robert Muhammad, director of the office of scholarships and financial aid at Winston-Salem State University in North Carolina. “It’s specifically for educational purposes: books, clothing, anything that is specifically tied to the pursuit of their education.”

You can’t use your loan for entertainment, takeout or vacations, but you should use it for transportation, groceries, study abroad costs, personal supplies or off-campus housing.

6. Find out who your servicer is and when payments begin

If you take federal loans, your debt will be turned over to a student loan servicer contracted by the federal government to manage loan payments. If you have private loans, your lender may be your servicer or it may similarly transfer you to another company.

Find your servicer while you’re still in school and ask any questions before your first bill arrives, says John Falleroni, senior associate director of financial aid at Duquesne University in Pittsburgh. They’re also whom you’ll talk to if you have trouble making payments in the future.

When you leave school, you have a six-month grace period before the first bill arrives.

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The article 6 Things to Know About Student Loans Before You Start School originally appeared on NerdWallet.

Grads Left Behind $3.75B in Free College Aid in 2021, Study Says

High school graduates are forgoing free money for college by not submitting financial aid applications, according to a new analysis by the nonprofit National College Attainment Network.

The Class of 2021 left behind $3.75 billion in Pell Grant aid by not completing the Free Application for Federal Student Aid, or FAFSA. An estimated 813,000 students were eligible for the Pell Grant — the largest federal grant program offered to undergraduates — but didn’t submit an application for federal student aid, according to NCAN.

“This quantifies exactly how much opportunity, in the form of forgone Pell Grants, students are leaving on the table,” says Bill DeBaun, director of data and evaluation at NCAN. “It’s another component of showing how dire the college-going situation is in the U.S. right now.”

The findings of the analysis are estimates only; it assumes all high school grads who are eligible for financial aid would submit an application and attend college directly after high school. Nonetheless, the analysis does show that a large number of students aren’t submitting the FAFSA, and if students aren’t submitting it, it’s unlikely they’re enrolling in college, DeBaun says. That can have countless long-term impacts, he added.

FAFSA completion rates are declining

The pandemic’s impact on FAFSA completion is one of the reasons $3.75 billion went unclaimed.

“A huge part of it is the FAFSA is complicated, and students from all walks of life really need support to get through the process,” says Traci Lanier, vice president of external affairs at 10,000 Degrees, a nonprofit college access organization that supports students before and after enrolling in college.

The pandemic forced much of that support to go virtual, Lanier added, and assisting students over one-on-one video conferencing proved to be a challenge compared with large groups that could gather and learn before the pandemic.

In 2019, 61% of high school graduates submitted the FAFSA, while in 2021, an estimated 53% had submitted the application by June 30, according to NCAN. College enrollment has dropped during the pandemic, along with FAFSA completion.

Since fall 2019, there has been a 5.1% drop in enrollment, which translates to nearly 1 million fewer students enrolled in college now than before the pandemic, according to estimates from the National Student Clearinghouse Research Center.

“This is not a hiccup, this is not a blip in college-going,” DeBaun says. “This is a real trend, and it is something that has and is going to keep having real implications on students’ individual finances, on their family’s finances, community’s finances, and then of course, local, state, and national revenue.”

Some state policies have increased FAFSA completion rates

The states with the highest FAFSA completion rates include Louisiana and Tennessee. In 2021, Louisiana had a completion rate of 68%, and Tennessee saw a rate of 71%, according to NCAN’s estimates. Both states have policies that incentivize students to complete the FAFSA.

On the other hand, there are 16 states that have completion rates below 50%, and in the two states with the lowest completion rates, Utah and Alaska, just 37% of high school graduates in 2021 submitted the FAFSA.

Louisiana made submitting the FAFSA a requirement for graduating high school in 2016, and completion rates jumped 10 percentage points in the first year the policy was implemented, says Peter Granville, a senior policy associate at The Century Foundation, a progressive, independent think tank. In Tennessee, students complete the FAFSA at such high rates due to incentives including free community college, Granville says.

“It is implicit in the [mandatory FAFSA] policy that everyone should have a chance to go to college,” says Granville. “I think it has the potential to do a great job starting conversations between students and their schools and their families about going to college and paying for college.”

Submitting the FAFSA is key to paying for college

Each Pell-eligible student in the Class of 2021 who didn’t submit the FAFSA missed out on an average of $4,477 nationally, NCAN estimates.

The Pell Grant is awarded based on demonstrated need, most often to lower-income students, but there is no income limit. The total award depends on details shared in the FAFSA as well as the cost of attendance of the school you plan on applying to.

For students in the Class of 2021 who didn’t submit the FAFSA, 44% said they didn’t do so because they didn’t think they’d qualify for aid, according to student loan lender Sallie Mae’s 2021 “How America Pays for College” study.

If you’re considering pursuing higher education this fall:

  • Even if you’re unsure whether you’d qualify for financial aid, you should still complete the application, as not all aid is based on demonstrated need.
  • You don’t need to know where you’re going to school before completing the application; rather, you just need to provide the names of the institutions you’re considering.
  • It’s best to submit the FAFSA sooner rather than later as some aid is disbursed on a first-come, first-served basis.

Colin Beresford writes for NerdWallet. Email: cberesford@nerdwallet.com.

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The FAFSA, Your Ticket to Help Pay for College, Just Opened

October marks the open date for the Free Application for Federal Student Aid or FAFSA — and college-bound students should submit the application as soon as possible.

Completing the FAFSA allows you to be considered for federal, state and school-based aid. In addition, submitting it soon after the Oct. 1 open date will increase your chances of receiving scholarships and grants that schools include in aid packages.

For the 2020-21 academic year, 56% of families used scholarships to help pay for college, according to Sallie Mae’s 2021 How America Pays for College study.

Even if you’re unsure you’d qualify for free aid, it’s still important to fill out the FAFSA. Most people are eligible for federal student loans. However, what varies is need-based aid, which is calculated based on your family’s finances. Since this aid comes from limited funds, applying early matters.

Here’s what you need to know about applying for aid sooner rather than later.

Get started on the FAFSA now

Submitting the FAFSA, particularly if you’re the first in your family to do so, can be complicated.

It helps to have all of the necessary information to complete the FAFSA before you start filling it out. And if you need additional assistance, there are online and in-person resources to help you complete the FAFSA.

“Some colleges and universities do select students for scholarships and grants based on a priority basis, and when your FAFSA was received could make a difference,” said Joe Cooper of Michigan Technological University in Houghton, Michigan, in an email. Cooper, the executive director of Student Financial Services, added, “If you are able to, completing your FAFSA within the first couple months it’s available is usually a best practice.”

You need to submit the FAFSA every year that you want to be eligible for federal aid. The FAFSA for this upcoming award year, or 2022-23, will remain open until June 30, 2023. If you haven’t yet submitted the FAFSA for the 2021-22 award year, it remains open until June 30, 2022. But deadlines can differ for individual institutions and states, so check which deadlines apply to you.

Give yourself more time to make a college decision

By submitting the FAFSA early, you also give yourself more time to consider your college choices.

If you haven’t enrolled in college yet, you can submit the FAFSA to the schools you’re considering and compare your award letters before you choose one. The aid you’re offered, including federal and school-based, can differ among colleges.

Completing the FAFSA early can also give you more time to appeal your financial aid award by submitting a financial aid appeal letter or requesting a professional judgment, regardless of whether you’re submitting it for the first time or not. During the 2020-21 academic year, 29% of families who received a financial aid offer appealed for more aid, according to Sallie Mae’s 2021 study.

You can submit an appeal letter if you’re unhappy with the amount of aid you received or if your economic circumstances have changed since you submitted the FAFSA. Nevertheless, submitting the FAFSA early will ensure financial aid is still available when your letter is processed.

Regardless, completing the FAFSA in the first place makes you eligible for the more than $120 billion in federal aid the Department of Education distributes each year. And getting it done early “maximizes your potential to be considered for all available financial aid,” Cooper said.

Colin Beresford writes for NerdWallet. Email: cberesford@nerdwallet.com.

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The FAFSA Just Opened: Why You Should Apply Now

An influx of college financial aid applications this year means that money could run out for students who don’t file early.

Due to financial strain caused by COVID-19, nearly 40% of families that didn’t previously plan to apply for federal financial aid now expect to do so, according to a recently released survey from Discover Student Loans.

The federal government, states, colleges and other organizations use the Free Application for Federal Student Aid, or FAFSA, to award financial aid. You must complete the FAFSA to be considered for financial aid.

You have 21 months to submit the FAFSA for any given academic year. For the 2021-22 school year, the FAFSA opens Oct. 1, 2020, and closes June 30, 2022. But that doesn’t mean you should wait.

“There is no downside to applying early, but a lot of risk in applying late,” says Manny Chagas, vice president and head of marketing and product at Discover Student Loans.

Here’s why you should file the FAFSA now.

Better shot at more free money

The sooner you submit the FAFSA, the greater your chances are of getting free aid you don’t have to repay, such as grants or scholarships.

Federal Pell Grant money likely won’t run out, but other need-based aid, including that awarded through your school and state, is limited and awarded on a first-come, first-served basis. Jack Murphy, financial aid counselor at the University of Northern Iowa, named the Federal Supplemental Educational Opportunity Grant and his school’s tuition assistance grant as examples.

The Federal Work-Study Program also has limited funds, so you’ll want to file the FAFSA early to take advantage of it.

More time to appeal a financial aid decision

Students and parents who are dissatisfied with their aid amounts or have a change in economic circumstances can appeal the financial aid award from their school. To do this, you need to petition your school with a financial aid appeal letter and provide evidence to support your need for more aid. If you wait too long, the aid money could run out.

Those who file the FAFSA early are more likely to receive their school-based financial aid awards with their college acceptance letters. While your federal aid will be the same no matter where you attend college, you can send your FAFSA information to several schools to see which will give you the best school-based aid package. Doing so early will allow you to compare offers and appeal if necessary.

If you apply for the FAFSA late, you not only risk a smaller award to begin with, but you also have less opportunity to “shop around” and submit a successful appeal letter.

A quarter of parents surveyed by Discover Student Loans say they’ll appeal their financial aid decision because of previous award amounts and pandemic-induced changes in family finances. In speaking about the survey, Chagas emphasizes that there tends to be more money available early in the process, so students should make the FAFSA a priority.

Murphy agrees. “Filing early makes sure you’re in the running to receive as many awards as possible,” he says. “We see students that get [aid] one year, but not the next.”

They don’t lose out on aid because they no longer qualify, Murphy explains. They just waited too long.

Cecilia Clark is a writer at NerdWallet. Email: cclark@nerdwallet.com.

The article The FAFSA Just Opened: Why You Should Apply Now originally appeared on NerdWallet.

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College Students Can Get More Aid During the Coronavirus Crisis

College students who left their campuses in droves as stay-at-home orders rolled in were often met with a whole new financial reality.

They had to relocate in a hurry, racking up unexpected travel and moving costs. Their rented apartments, dorm rooms and meal plans are now going unused. They may have lost a job or left one behind. They may need broadband access or even a new computer to complete the semester remotely.

To top it off, the home they go to may be facing financial straits of its own.

By week three of the coronavirus pandemic, half of college students and college-bound high school seniors said their family’s finances had been affected, according to a survey of 1,000 students by SimpsonScarborough, a higher education marketing and research firm in Alexandria, Virginia. With millions losing their jobs each week, that number has only grown since.

Here are three ways those students can find some help.

Get a refund from your school

Those who had to move out of dorms early will likely get a refund for room and board — the coronavirus relief act allocated money to colleges specifically for this purpose. You can expect a prorated amount, not the full cost you paid for the semester. Your college financial aid office will have information on how to receive a refund.

The funds you get back can be used to pay for any education-, travel- or living-related expenses you’ve incurred as a result.

But if your room and board was paid through a student loan and you don’t need the refund to make ends meet, consider returning it. Making a payment now prevents interest from accruing in the time before repayment officially begins. Contact your student loan servicer, the company that manages your loan, or private lender to make a payment with your refund.

Seek emergency aid from your college

The Department of Education is sending billions of dollars to colleges through the Higher Education Emergency Relief Fund authorized by the coronavirus relief act. Approximately $6.28 billion is specifically intended for colleges to distribute to students in the form of emergency cash grants. The grants can be used to pay for education-related technology and supplies, housing, food, child care and health care, the Education Department says.

“We are turning around applications very quickly, but it’s up to the schools how they choose to get the funding to their students,” says an Education Department spokesperson in an email. So far about half of eligible schools have applied to receive the grant funding, according to the department.

You are eligible to receive an emergency grant whether or not you filed the Free Application for Federal Student Aid. It’s unclear if schools will require the FAFSA from those who didn’t complete it previously in order to receive the aid.

“Some may do a more blanket approach” for students who get need-based aid, like a Pell Grant, while others might require an application, says Ben Miller, vice president for postsecondary education at the Center for American Progress, a public policy research organization. “I could see some doing a balance where some is automatic and some is held back for an application.”

Most schools are still in the early stages of figuring out distribution, but some have a plan.

At Vanderbilt University in Nashville, Tennessee, for example, students with previously identified financial need will receive $1,100 each from the $2.8 million the school will receive. About 20% of the population will qualify, Vanderbilt estimates.

At the University of Connecticut, students are being instructed to email the financial aid office, which triggers a review of their new financial need, according to Stephanie Reitz, university spokesperson and manager of media relations.

Your school may also have its own emergency fund established. These programs typically require students to apply.

At State University of New York at Cortland, a student emergency fund was created and funded by donor gifts. So far the school has received just under 200 applications and authorized around $36,500 in emergency assistance grants to students for food, rent and technology, says Frederic Pierce, director of communications at the college.

The type of emergency and size of awards will likely vary, says Miller, but the common thread will be an ability to demonstrate that need stems, in some way, from impacts of the coronavirus.

Only students eligible to receive federal financial aid can receive the funding, which leaves those in the Deferred Action for Childhood Arrivals program and international students unable to tap this resource.

Update your FAFSA form

Your family’s finances may have looked a lot different when you submitted the FAFSA. But the form you submitted isn’t permanent; you can make changes and receive aid retroactively, even if you already received your financial aid award.

To update the information reported, log in to FAFSA.gov and submit changes under “Make FAFSA Corrections.” Or you can contact your school’s financial aid office and ask them to make changes for you, especially if there will be a significant change in your or your parent’s income this school year, or if there are any other family circumstances to report that the FAFSA form doesn’t require.

The deadline to make updates is June 30 after the school year you need aid. For the 2019-20 school year, that’s June 30, 2020.

If you’re thinking about how you’re going to pay for school next year and you already received a financial aid award, you can file an appeal. Make sure to include a specific amount you’re asking for and reasoning for your request in your appeal.

Anna Helhoski is a writer at NerdWallet. Email: anna@nerdwallet.com. Twitter: @AnnaHelhoski.

The article College Students Can Get More Aid During the Coronavirus Crisis originally appeared on NerdWallet.

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Be First in Line for College Aid by Filing the FAFSA Now

The fall semester has only just started, but if you rely on financial aid to pay for college, you should get started on next year right now.

Why the time crunch? Submitting the Free Application for Federal Student Aid as close to opening day as possible will increase your chances of getting first-come, first-served federal aid. That includes Pell Grants and work-study, as well as grants and scholarships from your school and state.

That opening day is Oct. 1.

While 97% of families with college-bound students said they planned to submit the FAFSA, only one quarter knew the form becomes available in October, according to a 2019 survey by Discover, which provides private student loans.

You should submit the FAFSA, even if you think your parents make too much money for you to qualify for need-based aid. Submitting the application is also the key to accessing certain scholarships along with federal student loans.

If you’re not sure how to complete the form or need a refresher, here’s what you need to know so you can submit ASAP.

Know where to go

You can complete the FAFSA electronically on the fafsa.gov website or with the MyStudentAid app. But first you’ll need to create a Federal Student Aid ID — a username and password — that you can use to log in and sign both the FAFSA and, later, promissory notes. You can make one on the FAFSA website. If you’re submitting with a parent, they’ll need their own FSA ID, too.

If you don’t want to submit online, you can download a PDF through the FAFSA website or request a paper copy.

Get your documents ready

Completing the FAFSA will go quicker if you already have the documents you need, such as a Social Security card, driver’s license (if you have one), current bank statements and tax information. Use this checklist to prepare.

You don’t need to wait to file taxes before you submit: Parents and students can use “prior-prior year” tax information. That means you should use 2018 tax information for the 2020-21 form. Use the IRS data retrieval tool available with the online FAFSA to import your information from the IRS automatically. You cannot update the application with 2019 tax information after filing, but contact your school if your 2018 tax information no longer reflects your family’s financial situation.

Include colleges you want to apply to

Don’t wait to apply to college before submitting the FAFSA. All you need are the FAFSA codes for up to 10 schools where you plan to apply, which will be available on the online application or on the federal student aid website. If you want to add or change schools after you submit, you can update your application at fafsa.gov.

Remember the deadlines

You only have to apply once, but keep in mind three deadlines: federal, state and school. The deadline to apply for federal aid for the 2020-21 school year is June 30, 2021. Your school and state may have much earlier deadlines. Find out your state’s FAFSA deadline on the student aid website.

What happens after you apply

You’ll receive a Student Aid Report three to five days after submitting electronically with an FSA ID or up to 10 days using paper forms. The report will detail information about your financial aid eligibility. It includes your Expected Family Contribution, which is the estimated amount of money your family can contribute toward your college education.

In the spring, you’ll get your financial aid offer for the upcoming school year. If you’re an incoming freshman, you’ll get offers from the schools that accept you. Accept all free aid before choosing loans. If you’re not sure how much debt you can handle, use an affordability calculator to find out.

The article Be First in Line for College Aid by Filing the FAFSA Now originally appeared on NerdWallet.

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Rejected for a Personal Loan? Here’s How to Recover

Getting rejected for a personal loan can feel like a punch to the gut. It’s easy to get discouraged, especially if it delays plans to consolidate debt or renovate your home.

Instead of taking the rejection personally, use it as motivation to build your credit and supplement your income so you win approval the next time you apply.

Here’s how to recover from a personal loan rejection.

Ask for a reason

Lenders are required to disclose the exact reasons why they denied your application, according to the Equal Credit Opportunity Act.

Online lender Marcus by Goldman Sachs sends an explanation within seven to 10 days after a rejection, says Elisabeth Kozack, vice president of product strategy and customer experience at Marcus.

Common reasons for a loan denial at Marcus include having a low credit score and insufficient income to repay the loan, Kozack says.

Build your credit

Making timely payments on all of your debts and keeping your credit balances low are two steps to building credit, but don’t stop there.

  • Check your credit report for errors: Common errors that may hurt your credit score include payments that are wrongly reported as being late or delinquent, and accounts showing the wrong balance, according to the Consumer Financial Protection Bureau.

You can get free copies of your credit reports once a year from AnnualCreditReport.com. Dispute any errors online, in writing or by phone.

  • Get a credit-builder loan: Instead of giving you the borrowed money, lenders hold it in a bank account while you make on-time payments toward the loan. These payments are reported to the credit bureaus, helping to build your score. You get the money only after you’ve made all your payments.

Credit-builder loans are available through credit unions, community banks and Community Development Financial Institutions.

  • Become an authorized user on someone else’s credit card: Ideally, the account holder has a strong payment history, and the credit card issuer reports authorized users to all three credit bureaus.

Pay off debt

Your debt-to-income ratio helps lenders determine if you have too much debt. Divide your monthly debt payments by your monthly income to see your DTI ratio expressed as a percentage.

Borrowers with high DTI ratios (40% or greater) may be more likely to miss loan payments and have a harder time getting approved.

Scrutinize your budget for places you could trim an expense and use the savings to pay off debt, and avoid taking on new debt ahead of your next personal loan application.

Grow your income

A higher income lowers your DTI ratio and can help you qualify for a loan. You may not need to ask your boss for a raise, either.

Consider a side job such as ride-hail driving or tutoring, to put an extra hundred dollars or more in your pocket each month.

And when you reapply, include all sources of household income on the loan application — not just income from your full-time job, but also your spouse’s income, investment income, child support, alimony or military pay.

Compare lenders

Spend a few months getting your credit in shape and rebalancing your DTI. When you’re ready to reapply, choose a lender that caters to borrowers like you.

  • Online lenders most often lend to borrowers with good or better credit (690 to 850 FICO), but there are some that accept lower credit scores. You can pre-qualify online to preview rates and terms you’re likely to receive, with no impact to your credit score.
  • Credit unions are nonprofit financial organizations that consider your entire financial picture, and may provide cheaper loan options for bad credit (300 to 629 FICO). You’ll need to become a member of the credit union before applying.
  • Banks offer personal loans with low rates and discounts for customers with accounts in good standing. You’ll likely need good credit to qualify.

Get prepped

Take a fresh approach with your next loan application.

  • Gather documents. Lenders need to verify information you’ve provided on your application, such as tax returns to confirm your income. Having these documents prepared can make the application process go smoother.
  • Verify all information. False information on your application, such as the wrong address and misstated income, could lead to a loan denial. Double-check all details before submitting your application.
  • Add a co-signer. If you don’t meet a lender’s credit score requirements, consider adding a co-signer with good credit to your application. This can help you qualify and get you a lower rate.

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The article Rejected for a Personal Loan? Here’s How to Recover originally appeared on NerdWallet.