FAFSA can be accessed and completed online at fafsa.ed.gov. Federal Stafford loans are included in the FAFSA application process as one type of financial aid that may be available to the student.
A student is eligible to complete FAFSA and apply for financial aid, including Stafford loans, if the student is a U.S. citizen and has a Social Security number, has completed high school, is registered with the Selective Service if a male between the ages of 18 and 25, is enrolled or enrolling at a college and working toward a degree, does not have a drug conviction, and is not in default on a federal student loan or owe excess federal grant disbursements.
Effective July 1, 2010, Stafford loans will be available only via the Direct Loan Program, which originate from the federal government's Department of Education. Prior to July 1, 2010, Stafford loans were also available via Federal Family Education Loans, which originated from banks, credit unions and other lenders.
Financial aid received through FAFSA, including Stafford loans, can be disbursed directly to the student's college and applied to the student's account or disbursed directly to the student. If financial aid monies are received by the college and the student's account is paid in full, the college may issue a check directly to the student for the excess financial aid if the aid was in the form of a loan. The student is then able to use these funds for other college expenses, such as books and transportation. If excess grant monies are disbursed to the student, he may owe the grant provider.
Financial aid received through FAFSA that does not have to be repaid includes grants and campus work-study programs. Repayment for Stafford loans begins when the student graduates, falls below half-time enrollment or leaves school.