Applying for a student loan from the U.S. Department of Education is free. The application is called the FAFSA, which stands for Free Application for Federal Student Aid, and it's found at fafsa.gov. It's also complicated. So here's the question: should you pay someone to help you complete an application that is free?
There are services available to help you complete this application, giving you a better chance of getting a loan. One such service is Student Financial Aid Services, Inc., found at fafsa.com, which charges around $80. You can see the possible confusion.
We can't tell you what to do, but we can give you information to help you decide. Not all services are as honest as Student Financial Aid Services, Inc. You should know what you're getting in to. The government's FAFSA site warns students they don't have to pay to apply for a student loan from the government. There are scams out there. There are also legitimate services that can make your life a whole lot easier.
When I blogged about this issue, I heard from Mary Fallon, senior director of communications at Student Financial Aid Services. She set me straight about valid services, and I want to share that information with you.
The following words are from Mary Fallon, with minor editing for space. The headings are mine.
Is the Government Service Really Free?
I believe this warning was first posted several years ago when scholarship scams were prevalent.
This statement “any help that you pay for can be received free from your school or Federal Student Aid” is a fallacy. Why is it that people object to paying a professional to prepare the federal student aid application – which with 137 questions is more complex than most income tax forms – but don’t object to paying a tax consultant to prepare their income tax return?
Neither high schools or colleges nor the federal student aid telephone help desk have enough trained experts available to assist all college-bound and college students with their financial aid needs. And no service is free – the federal help desk and high school counselors are paid with your tax dollars. College financial aid administrator’s salaries are covered by students’ tuition and fees charged. Granted many bear these costs, but to say school, college, and government services are free and only commercial services have a cost is to misunderstand our economic system.
Certainly, college financial aid offices help their students answer aid application questions, but they don’t have enough trained people or hours in the day to prepare every student’s federal student aid application.
We’ve found that many people find the federal student aid form complex and/or too time consuming to do themselves.
College-bound students – those who haven’t been accepted yet – cannot turn to a college financial aid administrator for help because they aren’t members of a college yet. And while high school counselors at public and private schools offer college prep guidance, the great majority have no financial aid training nor the time to help every college-bound student prepare their application.
The federal student aid help line will answer individual questions but not advise on an individual’s specific circumstances. Only this year has the federal government offered one-on-one phone service to a couple of states on a limited basis. Also the FAFSA help line isn’t open 24/7 – certainly not on weekends and nights when most parents prepare their children’s FAFSA. We are.
Student Financial Aid Services is available at least 17 hours a day during peak aid application filing times and we have no limit on how often a client calls or how many people from an individual family we speak to. Our fees are relatively modest - $80 to $100 for a year and we offer a 100% money back guarantee within 60 days of purchase. Our advisors are rigorously trained. They catch mistakes that even the Dept. of Education’s computer misses – mistakes that can deprive students of aid. Our job is to accurately prepare an application and advise our clients so they receive the most aid possible. Our 99% client recommendation rating speaks for itself.
No legitimate FAFSA preparer charges for submitting the form. Fees are for the advice and expertise.
The student financial aid system is complicated – 9 federal, 605 state, and about 8,000 college programs – each with their own deadlines and rules. We track all this information plus policy decisions, rule changes etc. for our clients so they don’t have to.
U.S. law does authorize paid FAFSA preparation and the only condition, beyond what one hopes are high business ethics, is that a paid FAFSA preparer post in all of their marketing and on their website that their commercial business is not the Dept. of Education.
When people ask about the transparency of our website, www.fafsa.com (a domain name the company founder – a college admissions administrator – bought before the Dept. of Education had a FAFSA website), we note the following:
- The home page displays in a clear and conspicuous manner a notice that “We are not affiliated with the Dept. of Education.”
- The home page also states clearly that FAFSA can be filed for free, that it can be completed via paper or electronic form, that professional assistance is not a requirement, and that the free service is available at www.fafsa.ed.gov.
- In the center of the home page, we state prominently that we are the oldest and largest student aid advisory service and note that there is a fee for our service.
- We also inform visitors about the free FAFSA option in 17 other prominent places on our website and in total provide 47 links to www.fafsa.ed.gov.
- On every single page of our website we include a disclaimer that we are not the Dept. of Education or FAFSA on the web and provide a link to www.fafsa.ed.gov.
- Our website also provides a simple and clear side-by-side comparison of our services versus the Department of Education and explicitly notes that ours is a paid service and that people can prepare the form themselves and file it for free on ED’s site.
- We inform every caller that there is a free FAFSA option and that the FAFSA can be completed without professional help.
- In the “About Us” section of our website we state clearly, “Student Financial Aid Services, Inc. is a fee-based preparation and advisory company” and clearly outline our role.
- In all of our marketing communications and sales materials, we include information about the free FAFSA option.
Read Deb's blog for a FAFSA deadline clarification from Mary Fallon.