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How long it takes to get a student loan depends on when you apply, the type of loan, and how quickly a lender processes your application. (iStock)
Whether you have federal student loans, private loans, or a combination of the two, you may be wondering when the funds will be available.
The time it takes to get your student loan money depends on when you apply to school, what type of loan you accept, and how quickly your school or private lender processes the necessary information. Be aware that disbursement times may differ somewhat between private and federal student loans.
If you’re considering a private student loan, it’s a good idea to compare rates from multiple lenders. Credible makes it easy for you and can show you pre-qualified rates in minutes.
Where does the student loan money go
When your student loan is funded, the money doesn’t land in your bank account, at least not right away. For most federal and private student loans, lenders disburse funds directly to your school. Your school will then use the money to pay for your tuition, tuition, room and board (if you live on campus).
The school may send you the remaining loan funds to pay for other educational expenses that are not directly payable to your school, such as transportation.
How long does it take to get your federal student loan?
Once you have completed and submitted your FAFSA Application for Federal Government Student Loans, processing your application, and submitting your student aid report can take anywhere from three to 10 days, depending on whether you applied online or submitted a paper application.
The school will send out an offer of admission and prepare your award letter, so you know how much help you will receive. Typically, the Department of Education disburses federal student loan funds to schools at the beginning of each term of the school year. The school applies the funds to direct costs, such as tuition and room and board. The school will then return any remaining balance to you after a few weeks, unless you are a first-time borrower. In this case, the school may delay the funds for 30 days. You may also need to follow entry advice during this time.
Your school will distribute scholarships, grants, and loans to cover tuition, on-campus accommodation and meals, and fees before any excess loans are returned to you to cover other expenses.
WHAT IS A STUDENT LOAN REPAYMENT AND HOW TO GET ONE?
How long does it take to get your private student loan?
Once your loan is approved, the time it takes for the lender to send the funds to your school may vary – each lender has their own process. Typically, however, it can take anywhere from two to 10 weeks for your school to receive the loan money.
A direct consumer loan is another option. The lender will send the money directly to you, rather than to your school, to cover your education costs. If you opt for a direct consumer loan, the lender will deposit the funds directly into your bank account. Getting one of these loans does not involve your school’s financial aid office. But you’ll likely pay higher interest rates and fees for a DTC loan.
Borrowers with poor credit may need a co-signer to qualify for a private student loan. On the other hand, if you have good credit or a co-signer with good credit, you may qualify for a better interest rate and repayment terms on your private loan.
Credible makes it easy to see your prequalified private student loan rates in minutes.
How to check your loan status
After submitting your FAFSA online, you can immediately check the status of your loan disbursement. If you submit a FAFSA paper, it may take approximately seven to 10 days to receive a response by mail. To view the status of your loan(s) online, follow these steps:
- Login to FAFSA.ed.gov using your FSA ID. Under “My FAFSA” you will see the status of your financial aid application.
- You can find your student loan balances and other loan information through the StudentAid.gov website.
- To check the status of your private student loans, you will need to contact your private lender.
- It is possible to see what loans you have by visiting AnnualCreditReport.com and requesting free copies of your credit report from the three major credit bureaus.
- If all else fails, you can contact your school’s financial aid office as they will have up-to-date information on your loan status.
With Credible, you can easily compare private student loan rates from multiple lenders without affecting your credit.
