Student Loan Disbursement: How Long Does It Take?

Waiting for your student loan to disburse? You and 13 million others! Your student loan will cover full or partial tuition costs, and you will be given a remainder, if there is one, to your bank account. While you are waiting, you may still be responsible for other associated school costs such as living expenses, textbooks and other course materials. So understanding your financial timeline is important. How long does it take to get a student loan disbursement? Find out below. 




How Long for Federal Student Loans

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After you complete your FAFSA, enroll in college, accept your student aid offer, and sign the master promissory note, you still won’t receive your funds right away. 


For federal loans, the entire process can take 1-3 weeks for first-time borrowers. The good news is that after you have received your first payment for your first term of college, your financial aid is disbursed automatically for the following terms. 


Federal student loans are also automatically applied to your student bill, and should show up each term on your bill before the tuition and fees payment deadline. So, there is no need to worry if you will be able to receive federal aid on time in order to pay for school bills. 


However, many students receive federal funding in order to help pay for school-related costs not on the student bill. These costs, such as transportation, rent, course materials, and food, likely need to be paid before tuition is due, causing many students to wonder, how long does it take to get student loan disbursement?


Because loans are disbursed first to cover university costs, and tuition is not typically due until several weeks into the term, you may also have to wait several weeks into the school term to get a direct deposit of funds to help pay for your other expenses. 




How Long for Private Student Loans


Private students loans are similar in some ways to federal student loans, but in other ways they are very different. 


If the private loan is a school-certified loan, the disbursement will look similar to the federal student loan, in that funds will be applied directly to the student bill and any remainder will be direct-deposited into your account. 


If the private student loan is a direct-to-consumer or uncertified loan, you will likely receive the funds yourself, and it is your responsibility to make a tuition payment on your student portal. 


Both certified and uncertified loans can take 2-10 weeks to process in entirety. 




How to Check Student Loan Status

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There are two main ways to check your student loan status. You can log into your FAFSA online account with your FSA ID, and check the award amount and status there. You can also access the same information on your student portal’s financial aid section. For further information on using your college student portal, reach out to your academic advisor. 


To check on the status of private student loans, you may need to contact the lender directly. You likely created an account or had some communication with the lender, so check there first. If the private student loan is a certified loan, you may also be able to check the status of the loan on your student portal.  




How to Get Federal Student Loans


Submit the FAFSA


The first step to be able to get FAFSA money is to fill out the FAFSA. Ideally, you should do this the year before the academic year you would like to start school. That way, you will be guaranteed the highest possible aid award. In order to fill out the FAFSA, you will need demographic information, financial information, and a list of schools you are applying to. 



Review and Accept the Offer


After you complete the FAFSA, you will get a financial aid letter which will explain how much you and/or your family is expected to contribute (EFC). This is a general letter, and is not yet specific to your school. 


After you have enrolled in a college, you will receive another financial aid award offer that outlines exactly which loans, and the amounts, you are eligible for and can get for the academic year. You need to review and accept this letter, either on the FAFSA website or on your college website. 



Sign the MPN


MPN stands for Master Promissory Note. It is a legal document that all students receiving financial aid must sign before they can get their FAFSA money. The MPN is a legal document found on the Federal Student Aid website, in which you are stating you understand the financial responsibility of the loans and you guarantee to pay them back, plus the interest accrued. 



Set up Direct Deposit


If you have been awarded extra money to help pay for student costs, the money will be direct-deposited into your bank account each term. In order to get the money, you need to set up a direct deposit through your student portal, or on your Federal Student Aid account. For setting up a direct deposit, you need your bank account number and your bank’s routing number which can be found on your bank’s website or by doing a quick online search. 



How to Get Private Students Loans

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Do Your Research


When it comes to private student loans, you really need to do your homework to make sure you are not only getting a fair deal, but that you are avoiding the many scams out there. Check all the terms and conditions of the loan carefully, and also read into company reviews or information before you sign anything. 


Also, private student loans can take months from application to disbursement, so make sure you start your research early. 



Find a Cosigner


The private student loan lender may require a cosigner — this is someone who is also responsible for your loans if you cannot pay. If you need a cosigner, choose someone close to you that you have a trusting relationship with. Even if the lender asks for a cosigner, you may be able to get this requirement waived just by asking, or by showing good credit.  



Get the Right Paperwork


Each private loan application varies slightly, but the information needed is generally the same as the information you gave on your FAFSA. This includes personal and demographic information, financial information such as a list of assets and bank statements, employment information, and mortgage information. If you have a cosigner, they will need to provide this information as well. 



Submit the Application


Once you have all the necessary information and you’ve completed the application, you will be able to submit, and you will hear back with an offer.




The Bottom Line


So there you have it — the answer to your question, “How long does it take to get a student loan disbursement?” The short answer is that it varies from 1 week to several months, but now you have a better idea of what influences those factors. 


If you are looking for a way to avoid taking out student loans, whether private or federal, check out tuition-free universities, such as University of the People. We offer online, fully accredited associate’s, bachelor’s, and master’s degrees, completely tuition-free!


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