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|Student loans in the U.S.|
|Higher Education Act of 1965|
U.S. Dept. of Education
FAFSA · Cost of attendance
|Federal Direct Student Loan Program|
Federal Family Education Loan Program
|Perkins · Stafford|
PLUS · Consolidation Loans
The Free Application for Federal Student Aid (known as the FAFSA) is a form that can be prepared annually by current and prospective college students (undergraduate and graduate) in the United States to determine their eligibility for student financial aid (including the Pell Grant, Federal student loans and Federal Work-Study).
Despite its name, the application is not for a single federal program, being rather the gateway of consideration for:
The U.S. Department of Education accepts applications beginning January 1 of each year for the upcoming academic year. Each application period is 18 months; most federal, state, and institutional aid is provided on a first come, first served basis. There are six (6) states — Illinois, Kentucky, North Carolina, South Carolina, Tennessee, and Vermont — that award state grants on a first-come, first-served basis until the money runs out. Students are advised to submit a FAFSA as early as possible for consideration for maximum financial assistance.
The U.S. Department of Education advises students to utilize the IRS Data Retrieval Tool (DRT), which is made available on the FAFSA. This tool will retrieve most of the student's tax information, excluding wages, directly from the IRS and automatically input the information on his or her application. The DRT may be used for both students and parents alike.
Applicants who have completed a FAFSA in previous years may submit a renewal FAFSA. Any information that has changed must be updated annually. The FAFSA consists of numerous questions (at least 130 for the 2010–2011 academic year) regarding a student's (and his or her family's) assets, income, and dependency. These are entered into a formula that determines the Expected Family Contribution (EFC). A number of factors are used in determining the EFC including the household size, income, number of students from household in college and assets (not including retirement and 401(k) funds, the family home and small businesses owned and controlled by the family). This information is required because of the expectation that parents will contribute to their child's education, whether that is true or not.
The FAFSA does not have questions related to a student's or family's race, ethnicity, sexual orientation, disability, or religion. FAFSA does ask which colleges a student is applying to, and the entire list of up to ten colleges is sent to each college; as a result, admissions officers can see which other colleges a student is applying to. There was controversy about college admissions officers and enrollment consultants using data mining techniques to analyze these lists, and concerns that colleges interpret a higher FAFSA position as a sign of demonstrated interest in attending, as well as concerns that colleges could deny admission, waitlist applicants, or offer less financial aid as a result of such interpretations. Advisers recommend alphabetical lists of colleges to obscure preferences.
A Student Aid Report (SAR), which is a summary of the FAFSA responses, is forwarded to the student. The student should review the SAR carefully for errors and make any corrections. An electronic version of the SAR (called an ISIR) is made available to the colleges/universities the student selects on the FAFSA. The ISIR is also sent to state agencies that award need-based aid.
Some colleges also require the CSS Profile to be filled out as early as the same deadline as an early admissions or early decision application deadline, beginning October 1 of each year for the upcoming academic year. The CSS is a fee-based product of the College Board and usually concerns funds disbursed by a college rather than federal or state funds.
Nearly every student is eligible for some form of financial aid. Students who may not be eligible for need-based aid may still be eligible for an unsubsidized Stafford Loan regardless of income or circumstances.
A student who can meet all of the following criteria may be eligible for aid:
Student Aid and Fiscal Responsibility Act (SAFRA) changes the criteria for suspension of eligibility for drug-related offenses. Previously, students could lose eligibility for either the possession or sale of a controlled substance during the period of enrollment. SAFRA drops the penalties for possession of a controlled substance but retains the penalties for sale of a controlled substance. SAFRA increases the suspension to two years for a first offense and indefinite for a second offense.
Students who are military veterans and active duty service members may apply for financial aid by filing a FAFSA even if they also apply for education and housing benefits offered by the Post-9/11 G.I. Bill and its accompanying Yellow Ribbon program. The amount of military aid a student receives for a college education does not defer eligibility or reduce the amount of student aid that student could receive from the four federal grant programs – Pell, SMART, FSEOG, and TEACH – and many of the state student aid programs.
Federal Student Aid offers several different types of financial aid. The four most common types of aid students are offered from the federal government as a result of completing a FAFSA are:
By federal law, students have two options when preparing their annual, federal student aid application: either prepare the form on the U.S. Department of Education's website or get assistance from a fee-based FAFSA preparation service. Most financial aid is providing on a first-come, first-served basis and students are encouraged to prepare a FAFSA on January 1 of every year because millions of students compete for the billions in need-based and merit aid.
On the U.S. Department of Education's website, students have three preparation options: 
The Higher Education Opportunity Act of 2008 authorized fee-based FAFSA preparation. (The options are much like those for taxpayers who may either prepare their own income tax forms or get assistance from professional, tax-preparation services or software.) Fee-based preparation of the aid form had been allowed as early as 1995. HEOA formalized the option in 2008. The oldest FAFSA preparation and assistance firm is Student Financial Aid Services, Inc. of Sacramento, California, which operates the website, and which also provides free FAFSA preparation through its national program Access for All(R)designed to assist low-income students.
By law, fee-based FAFSA preparation services must on initial contact with students inform them of the free option and be transparent about their non-affiliation with the U.S. Department of Education and their fees. Students should not engage with FAFSA preparation firms that are not transparent about FAFSA options and their fees upfront.
Many free FAFSA preparation resources exist. Students are encouraged to bring questions to their schools' financial aid office or seek help from another resource at their high school such as a guidance counselor. However, with the (2013) student to school counselor ratio being 457 to 1, students can learn more about the financial aid process at a large variety of websites, such as Edvisors  and The College Solution.