Student loans are different from personal loans in a number of ways, and among the key differences are how the loan limit is determined and to whom the loan is paid. While a personal loan limit is set based on your ability to pay, student loan limits are given in the amount you need to pay for school. Instead of paying you directly, most lenders pay the school directly. Therefore, you must apply at the right time to make these steps possible.

Starting the Process

When you determine you need financial aid, start by speaking with the financial aid office at your college or university. Ask about deadlines for applications. This will guide you toward the beginning steps, and it will help you secure any grants you may be eligible through the university. Next, ask about the Free Application for Federal Student Aid, or FAFSA. This is the general application you will send in to determine if you qualify for a government loan.


You can only begin applying for federal or private student loan aid once you know which college you are attending and what your costs will be for the semester. On the other hand, once you know this information, it is best to send in your application as soon as possible. There are deadlines for all applications. Further, lenders have limited resources. If you get your application in first, you have first shot at those resources, which can help you get the loan you are looking for.

Canceling a Loan

What happens if you finalize your loan early, then decide to attend a different school, pick a different major or postpone schooling for a semester? As long as the funds have not exchanged hands to your school yet, you can still withdraw your request for a loan. However, if the school has already been paid your tuition, you may need to continue to repay the debt even if you do not attend school. Therefore, it is important to keep the deadline for withdrawing in mind if you are uncertain about your decision. You can find the deadline annually through the Department of Education or by asking your school's financial aid office.

Reapplying Annually

Federal loans require you to reapply for financial aid each semester once you know your tuition cost for that term. You do not need to go through each step again, but you will need to request a new loan in the amount required for this term. Some private lenders give larger, lump sum loans, but this will depend on your lender. Be certain to continually meet your application deadlines while you attend school. If you miss a deadline, you may have a gap in funding during your time at school, and this can lead to challenges to gaining your degree.

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