How to Apply for Student Loans: A Step-by-Step Guide

Kat Tretina Published on April 25, 2019

how to apply for student loans

If you’ve just been accepted into college, congratulations! You’re about to embark on one of the most exciting periods of your life, where you’ll meet lifelong friends and get an education that will empower you with the tools you need for your career.

However, college is expensive. According to The College Board, a single year at a public, in-state university is $9,410. Opt for a private school, and that number jumps to $32,410. Few people can afford to pay that out of their own pockets, so most turn to student loans to foot the bill.

Where do you even start? Between federal and private loans and the different application processes, it can be overwhelming. But don’t worry. Here is a step by step guide on how to apply for student loans.

Step 1: Exhaust other aid first

Before even thinking about submitting an application for student loans, make sure you exhaust all of your other options first. There are other forms of financial aid you can use to pay for college:


  • Scholarships: Unlike loans, which have to be repaid with interest, scholarships never have to be repaid. You can get scholarships from colleges, or from private organizations. You can search for available scholarships at FastWeb.
  • Grants: Like scholarships, grants do not have to be repaid. You can qualify for grants from the federal government or from your school.
  • Work-study programs: With a work-study program, you work at a part-time job related to your area of study and use the money you earn to pay for a portion of your tuition and expenses.

By utilizing these forms of financial aid, you can minimize how much you need to borrow in student loans.

Step 2: Understand your options

When it comes to student loans, there are two main options: federal and private student loans.

Federal student loans

Federal student loans are offered by the government, and tend to have lower interest rates and more generous repayment terms than private student loans. As an undergraduate student, you may be eligible for subsidized or unsubsidized Direct Loans, which both have an interest rate of 5.05% for the 2018-2019 school year.

With subsidized loans, the government covers the cost of the interest that accrues while you’re in school and for six months after you graduate. With unsubsidized loans, you’re responsible for all the interest that accrues on your loan, even when you’re still in school.

Federal loans have a grace period. It’s a six-month period after you graduate when you don’t have to make payments on your loans, giving you time to find a job.

When you enter repayment, federal loans have unique perks, such as the ability to enter into an income-driven repayment plan. Under these plans, you may be able to qualify for a much lower monthly bill that is based on how much you make.

Private student loans

If you need more help paying for school than you can get from the federal government, private student loans can help fill the gap. Private student loans are offered by banks or financial institutions and interest rates can vary from lender to lender. Depending on the loan repayment plan you choose, you may have to start making payments while you’re in school.

As an undergraduate student, you’re unlikely to qualify for a private loan on your own. You’ll probably need a cosigner. A cosigner— usually a parent or relative with a stable income and good credit — acts as a guarantor on the loan. Having a cosigner decreases the risk to the lender, making it more likely you’ll get approved for a loan.

Step 3: Gather your information

Whether you plan on applying for federal or private student loans, you’ll need to collect some information before you complete the process.


  • Tax returns: While you can use the IRS Data Retrieval Tool, it’s helpful to have a paper tax return as well. You should have the tax return from two years ago. You’ll need your parents’ tax returns as well as your own, if you filed taxes.
  • Adjusted gross income: You’ll need the adjusted gross income of both yourself and your parents.
  • Asset information: You’ll need to provide information about your assets, such as account balances.
  • Social Security numbers and birthdates: You’ll need your birthdate and Social Security number.
  • A list of schools you’re interested in: Include all schools that you’re even thinking of applying to on the application.
  • Information on grants or scholarships you’ve received: If you’ve received any grants or scholarships, you’ll need to enter how much aid you got.

Step 4: Complete the FAFSA

To qualify for financial aid, you must complete the Free Application for Federal Student Aid (FAFSA). It’s what the federal government and colleges use to determine your aid.

It’s free to complete the FAFSA, but it’s a good idea to submit your application as soon as possible. The earlier you complete it, the more likely you are to qualify for financial aid, including grants.

You can complete the FAFSA online. You’ll need to create a Federal Student Aid ID, which you then use to access your application in the future.

Once you finish the FAFSA, you’ll receive a Student Aid Report. This is a summary of your financial information and provides your Expected Family Contribution (EFC), or how much your family is expected to pay toward your education. If you notice a mistake on the Student Aid Report, log into your FAFSA to update it right away.

Step 5: Complete your CSS profile

Besides federal aid, you may be eligible for institutional aid, which comes from the school you attend. To qualify, you must submit the CSS profile.

To do so, create an account. Then, select the schools you’re interested in — not all schools participate — and provide information about yourself, your family’s finances, and your assets. There is a $25 fee for submitting the profile, and you’ll have to pay $16 for each additional report.

The College Board has a comprehensive guide on how to complete the CSS profile if you need additional help.

Step 6: Review your financial aid award letter

After you complete the FAFSA and are accepted into college, schools will send you a financial aid award letter, which details what aid you’re eligible to receive. The letter will detail the total cost of attendance, what you got in the form of scholarships or grants, and what federal student loans are available. To accept, you generally need to sign the letter and return it to the school financial aid office.

Step 7: Decide if you’ll need private student loans

In some cases, you may find that you need more aid than the school and government provides. If that’s the situation, private student loans can help.

It’s a good idea to shop around with different lenders to ensure you get the best deal. Luckily, you don’t have to comparison shop manually on your own. Purefy’s rate comparison tool allows you to compare offers from multiple lenders at once.

When you apply, you’ll need to provide much of the same information as you did on the FAFSA. Make sure you know how much you want to borrow and what school you want to attend.

After submitting your application, it can take a couple of weeks to receive your funds. So, fill out an application as soon as possible to make sure you get the money you need on time.

Paying for college

Now that you know how to apply for student loans, you can get the funding you need to pay for college. Make sure you understand all of your options so you can minimize how much you need to borrow. Reducing how much you take out in student loans now will help you in the long run after you graduate.

If you need help paying for school, get multiple private student loan offers in minutes . And if you have any questions, feel free to reach out to us by phone at 202-524-1115 or by email at info@purefy.com.