How Long Does It Take for FAFSA to Send Money?
Understand the full timeline for receiving federal student aid, from your FAFSA submission to the actual disbursement of funds.
The Free Application for Federal Student Aid (FAFSA) is the gateway to federal student aid programs. It collects financial and demographic information to determine eligibility for various forms of aid, including grants, scholarships, federal work-study, and federal loans. Understanding the timeline from application submission to fund disbursement helps students and families plan for educational expenses.
FAFSA Processing and Student Aid Report
After FAFSA submission, the U.S. Department of Education processes the application to determine federal student aid eligibility. Online submissions are processed within one to three days, while paper applications take 7 to 10 days. Once processed, the student receives a FAFSA Submission Summary.
The FAFSA Submission Summary provides a summary of the information submitted and includes the Student Aid Index (SAI). The SAI is calculated using FAFSA information to assess eligibility for need-based aid. Students should review their summary for accuracy. Corrections can be made online, processing in one to three days, or via paper, which takes several weeks.
Selection for verification can extend processing time. This occurs when the Department of Education or the school requests additional documentation to confirm reported information, which can delay the overall timeline for receiving aid.
School’s Role and Financial Aid Offers
Once the Department of Education processes the FAFSA, it transmits the applicant’s information to the listed colleges. Schools typically receive this data within one to three business days. However, receiving FAFSA data does not immediately translate into a financial aid offer, as colleges have their own processes for utilizing this information.
The timeline for schools to send financial aid offer letters varies, depending on each institution’s admissions and financial aid cycles. Many colleges send offer letters around the same time as admission acceptance letters. Early decision or early action applicants might receive offers between November and March. Regular decision applicants often receive offers in the spring, from March to May.
A financial aid offer letter details the types and amounts of aid a student may receive from federal, state, and institutional sources. It also outlines the estimated Cost of Attendance (COA), which includes tuition, fees, room and board, books, and other educational expenses. The offer letter is a notification of potential aid, not the actual funds.
Aid Acceptance and Disbursement Timelines
After receiving a financial aid offer, students must take specific steps to accept the aid. This typically involves formally accepting the offer, often through the school’s online portal.
For federal student loans, additional requirements include completing a Master Promissory Note (MPN) and entrance counseling. The MPN is a legal document where the borrower promises to repay the loan, outlining its terms and conditions. Entrance counseling is an online session designed to ensure borrowers understand their rights and responsibilities regarding their federal student loans. Both the MPN and entrance counseling must be completed before federal loan funds can be disbursed.
Once all requirements are met and aid is accepted, the funds are generally disbursed directly to the school. The school then applies the financial aid to the student’s tuition, fees, and, if applicable, room and board. Any remaining balance after these direct charges are covered is then paid to the student. This refund is typically issued within 14 days of the aid being credited to the student’s account, usually via direct deposit or check.
Federal student aid, such as Pell Grants and Direct Loans, is typically disbursed in at least two payments per academic year, corresponding with the school’s academic terms like semesters or quarters. For instance, a student might receive one disbursement at the beginning of the fall semester and another at the start of the spring semester. Some first-year undergraduate students who are first-time federal loan borrowers may experience a 30-day waiting period from the start of their enrollment period before their initial loan disbursement. Factors that can delay the disbursement of funds include not meeting enrollment requirements, incomplete paperwork required by the school, or not completing necessary loan requirements like entrance counseling.