Do you apply for student loans every year?

You've been accepted to and chosen a college. Congratulations! You've probably researched on-campus housing, what you'll study, and — something not quite as exciting but still important — student loans.

Student loans can be an intimidating subject, especially if this is the first time you and your family are going through the financial aid process. One question you may have is: Do you apply for student loans every year?

Let's answer this in detail.

Do you apply for student loans every year?

Whether you need to apply for student loans each year depends on the type of loan and the lender. In the case of federal student loans, yes, you must apply every year you need funding. That means filling out the Free Application for Federal Student Aid (FAFSA) every year while in college.

The FAFSA helps determine eligibility for federal aid, which could be from grants, work-study programs and federal loans. The FAFSA typically takes about 30 minutes to fill out. You can submit it either online or by mail. Gathering the required information before you start — like your Social Security number, tax records and banking information — can help you complete the application more quickly.

If you prefer to submit the FAFSA online, go to studentaid.gov and create an account. You will need your FSA ID (account username and password) to access your account information again, so be sure to save it.

You will be prompted to enter personal and financial information and the schools that you are interested in attending. If you're a dependent, your parents or legal guardian will also have to enter their information and electronically sign the application. After you submit the form, you will receive a confirmation email.

The schools you listed on the application will be able to access your FAFSA information after it's processed. You can also access a summary of the details. The schools' financial aid departments may then send you a financial aid offer by email or mail with the types and amount of aid you could receive. If you’re eligible, a school’s aid package may include federal student loans.

If you find that there is a gap between your total cost of tuition and financial aid offer you may consider applying for a private student loan. The application process for private student loans will vary by lender, but typically require you to apply each year. However, some lenders may offer features to help simplify this process, like Citizens Multi-Year Approval.^†

What is Multi-Year Approval for student loans?

With Citizens Multi-Year Approval for student loans, you only have to submit one student loan application.

Here's how it works: When you initially apply for a Citizens undergraduate, graduate or parent student loan, you will be notified if you qualify for Multi-Year Approval^† based on a credit check and review of you and your cosigners (if applicable) financial information. Along with the Multi-Year Approval^†, you and your cosigner will be notified with how much funding you qualify for – not for that one year, but for all four years or until the end of your degree program.

If you applied as a freshman, when sophomore year comes around, you won't have to fill out a new application all over again. Instead, you simply request additional funding for that academic year and the lender will do a soft credit check — which doesn't impact your credit score — to confirm your financial information hasn't dramatically changed.

Upon approval, funds will be disbursed directly to your school making this process much quicker than filling out a brand new application each year. It is important to note that Multi-Year Approval^† funds are approved for the degree in which you applied for. For example, if you applied and received approval for your Undergraduate degree and move on to Graduate School, you will need to reapply and qualify again for Multi-Year Approval^† for that new degree program. However, if you change schools during undergrad, you are able to continue using your Multi-Year approved funds.

With Multi-Year Approval, you can spend less time applying for loans and more time enjoying each other’s company.

Example of how Multi-Year Approval^† for student loans works

Let's say you and your family qualify for $100,000 to cover all four years of your degree program through Multi-Year Approval. You determine that you need $15,000 for your freshman year. This leaves you with $85,000 of qualified funding for your remaining three years.

The following year, your cost of attendance changes. You discover that you need $25,000 since you didn't get as much in scholarships as you did as a freshman. Rather than start all over again and fill out another application, you simply request the $25,000 disbursement you need from your student loan lender.

The lender does a soft credit check and confirms that your family's financial situation is the same as it was last year. You're now approved for the $25,000 as a new loan under the initial promissory note. That $25,000 comes from the remaining $85,000, which leaves $60,000 to tap into for your junior and senior years.

You can pull from the $100,000 you initially qualified for throughout your college degree program. And if you don't need the full $100,000, that's fine. Only use what you need.

Benefits of Multi-Year Approval^† for student loans

If you are using a private lender, Multi-Year Approval^† for student loans can save time, reduce hassle and protect your credit score.

Here are several important benefits to consider:

• Fewer applications to fill out: You only have to submit one application for all four years that you will be working on your degree. This simplifies the student loan process and helps you save time. It can also help to reduce stress.
• Fewer hard credit checks: If you apply for a new student loan each year of your degree program, your lender performs a hard credit check for each new application. Hard credit checks temporarily reduce your credit score. With Multi-Year Approval for student loans, a hard credit check is performed when you first apply. Soft credit checks — which do not affect your credit score — are performed for each additional year.
• Borrow only the funds you need: Predicting how much you will need to borrow for your degree program can be difficult. You could qualify for scholarships or participate in a work-study program, which can reduce your financial need. With a Multi-Year Approval for student loans, you only have to borrow the loan amount you need for each school year.
• Simplified repayment: Obtaining your student loans from a single lender makes loan repayment easy. Instead of juggling multiple lenders, you can keep up with your loan information online through one website and easily view your due dates, payment amounts, interest rates and other information.

Choosing the right student loan lender

Whether or not you'll need to apply for student loans every year depends on if you are using federal or private student loans. If you are using private loans, it also depends on the lender and whether they offer Multi-Year Approval for student loans.

If this type of loan sounds right for you, you'll have several factors to consider when deciding which private student lender to go with. You should compare interest rates, loan terms, fees, repayment options and loan limits. If more than one lender offers an enticing interest rate, Multi-Year Approval for student loans could be a valuable tiebreaker.

In addition to Multi-Year Approval^†, with rate discounts and flexible repayment options, find the Citizens Student Loan™ that fits your life and budget.