Student loan application requirements: What to know

It’s becoming increasingly common for people to use student loans to pay for school. In 2020, 55% of students who earned a four-year degree graduated with student loan debt, according to a CollegeBoard survey.

If you’re thinking about using student loans to pay for school, it’s important to understand how they work and their requirements before you apply. Keep reading to learn how to apply for student loans, the requirements for different types of loans, and when you should apply to ensure you have your financing lined up in time.

• How to apply for a student loan
• Federal vs. private student loan requirements
• When you should apply for student loans

How to apply for a student loan

If you’re planning to use federal student loans to help pay for college, here’s how to get started.

1. Complete the FAFSA

The Free Application for Federal Student Aid (FAFSA) is the form you’ll use to apply for federal student loans, along with other types of federal aid. On this application, you’ll provide information about your family’s financial situation. The information you provide is used to determine what aid — and how much of it — you qualify for.

To fill out the FAFSA, you’ll need:

• Your Social Security number or tax identification number
• Your federal income tax returns and W-2 forms
• Your bank statement and investment records
• Your records of untaxed income

If you’re an independent student, you’ll only have to provide this information for yourself. But if you’re a dependent student, which is the case for most undergraduate students, you’ll also have to provide this information for your parents.

2. Decide which federal loans to accept

Once you complete your FAFSA, you’ll receive word from your school’s financial aid office about which student loans you qualified for. The amount you qualify for is based on two important factors: your family’s expected contribution and the cost of attendance at the college you’re going to.

Depending on your situation, you may have several loan types to choose from. If you’re offered subsidized loans, you should use these first. They’re only available to undergraduate students with financial need, but the U.S. Department of Education pays the interest accrued while you’re in school at least half-time, during periods of deferment (paused payments), and up to six months after you graduate.

Even if you don’t qualify for subsidized loans, you’ll still be eligible for unsubsidized loans. Unlike subsidized loans, you’re responsible for the accrued interest while you’re in school, but you don’t have to demonstrate financial need to qualify. Unsubsidized loans are available to undergraduate and graduate students.

3. Consider taking out private student loans

Depending on your situation, federal student loans might be enough to fund your college education. But there’s a limit to how much you can borrow.

For subsidized loans, dependent students can borrow up to $5,500 for their first year in school. For the second year, the limit increases to $6,500. For the third year and beyond, dependent students can borrow up to $7,500 per year.

There’s also an aggregate limit — dependent undergraduate borrowers can’t qualify for more than a total of $31,000 in federal student loans.

If your education costs more than you can borrow in federal loans, you may have to turn to private loans to make up the difference. These loans have higher limits, and depending on your credit score, you can generally borrow up to 100% of your cost of attendance.

Federal vs. private student loan requirements

The requirements for applying for student loans depend on whether you’re applying for federal or private loans.

Federal student loan requirements

To qualify for student loans from the federal government, you’ll have to meet the following requirements:

• Be a U.S. citizen or eligible noncitizen
• Have a valid Social Security number
• Enroll or be accepted in an eligible program
• Be enrolled full-time or half-time
• Maintain satisfactory academic progress
• Complete the FAFSA
• Have a high school diploma or equivalent

Private student loan requirements

The requirements for private loans aren’t quite as cut and dry, since each lender can set its own. But here are a handful of requirements you’re likely to run into with most private lenders:

• Have a satisfactory credit score and credit history
• Meet your lender’s debt-to-income ratio threshold
• Apply with a cosigner, if needed (or look for loans that don’t require a cosigner)
• Enroll or be accepted in an eligible program
• Have a high school diploma or equivalent
• Meet certain age and citizenship requirements

When you should apply for student loans

Generally speaking, you should complete the FAFSA as early as possible. The application opens on Oct. 1 for the following school year, with the deadline for completion at the end of June. Certain types of financial aid are in finite supply, so applying early will increase your chances of getting them. Additionally, if you don’t apply in time to receive your aid before the school year begins, you may have to come up with other financing arrangements in the meantime.

Here are the FAFSA deadlines for the 2022-23 academic year:

• The FAFSA must be submitted by 11:59 p.m. Central time on June 30, 2023.
• Corrections or updates must be submitted by 11:59 p.m. Central time on Sept. 10, 2023.

In addition to federal deadlines, your college may have its own deadline. Each state has its own FAFSA deadlines as well, which you can check on the StudentAid.gov website.

When it comes to applying for private student loans, there’s no official deadline. But you’ll want to apply in time to receive your aid before your tuition is due.

Depending on your lender and your credit situation, you may be approved for your private student loan and receive your money quickly. But in other situations, it could take weeks — or even months — to get your funds. For that reason, it’s best to apply at least a couple of months before you need the money.