How Long Does It Take for You to Receive Your Student Loan Money?

Written by James Hirby | Fact checked by The Law Dictionary staff |  

The process of applying for student financial aid can be tedious and frustrating. Since it's a high-stakes process that determines whether you'll be able to pay for the classes necessary to train you for your future career, you'll need to ensure that your application comes off without a hitch. Unfortunately, even perfectly-placed student loan applications that encounter no unexpected delays or problems can take months to bear fruit.

In order to ensure that you receive student aid for your first year of college, you'll need to begin applying for aid in January of that year. This application process involves filling out a FAFSA form and subsequently communicating with your higher education institution to ensure that your in-house financial aid awards and tuition payments have been finalized. For subsequent years, you'll need to reapply for financial aid and begin to renew your loans several months before the start of the school year.

Depending upon the cost of your tuition and the size of your individual student loans, you may need to apply for several student loans per semester. If you attend school at an expensive private institution, you may be on the hook for a dozen or more loans. It's important to stay organized during the application and approval processes. To ensure that you don't misplace any important documents, keep a backed-up electronic record of all of the documents related to your financial aid package. For additional security, print out hard copies of each document for storage in a dedicated filing area. You may wish to use separate folders for each lender and maintain a discrete filing system for each semester or school year.

Once you're approved for a student loan, you must expect a delay of at least three to four weeks before its balance is disbursed. Depending upon the terms of your loan and the policy of your higher education institution, this balance may be deposited directly into your checking account or credited directly to your tuition bill. For security reasons, your lender is unlikely to send a check or money order.

These days, most schools prefer to receive loan funds directly. If your lender agrees to disburse your loan in this manner, you can expect to receive its full balance within 30 days of the official start of the semester. This sizable delay is designed to "weed out" students who drop out soon after enrolling in their classes. Be sure to check with your school to ensure that you're not subject to any academic restrictions during the period in which your lender continues to hold your loan funds.

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