For many college applicants, filling out the Free Application for Financial Student Aid, or FAFSA, is a rite of passage. That single form, which gets submitted annually, dictates how much federal aid students are entitled to. That aid could come in the form of student loans, grants, or a combination of the two. 

But many families find the process of filling out the FAFSA daunting. Some may even avoid it because they're worried they'll do it wrong, and thereby miss out on the opportunity to borrow for college affordably or even snag free money toward higher education costs via grants. 

A female student working on her laptop while sitting on the stairs outside a building.

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New changes to the FAFSA, however, will make it easier for families to complete that oft-necessary form. And that's good news for those who expect to apply for federal financial aid to fund their college experience. 

Remember, while it's possible to borrow for college without going through the Department of Education, the interest rate on private loans is often much higher than for federal loans. The interest on private loans can also be variable, which means monthly payments can increase in the course of repayment. Private student loans also don't offer the same borrower protections as federal ones -- there are no official income-driven repayment plans or deferment options with private loans. That can hurt those who wind up struggling with the repayment process. As such, it almost always pays to exhaust federal borrowing options before resorting to private loans.

A shorter process

Congress recently determined that the IRS will be allowed to share families' income information with the U.S. Department of Education, which gives out federal student aid. This means that families filling out the FAFSA will no longer have to dig through old tax returns to provide those financial details. In fact, about 20 questions will be eliminated from the FAFSA, which will not only save federal aid applicants time in filling it out, but also reduce the likelihood of making an error. 

Another thing: Because this change allows the IRS to share income details, that information will soon get updated automatically year after year. The result? Families won't have to resubmit that information annually, eliminating a potential headache. 

Are more FAFSA changes in store?

Congress is considering additional changes to the FAFSA in 2020 that aim to make it easier for families to fill out. And that's important, because an estimated 97% of families with college-bound students intend to complete the FAFSA. And a 2019 Discover Student Loans survey showed that more than one-third are stressed about the process. Simplifying the form will hopefully encourage more families to submit it, since there's really nothing to lose by doing so. As the name indicates, there's no cost to apply for aid via the FAFSA. 

It's too soon to know whether the aforementioned changes will take effect in time to impact families applying for financial aid for the 2020-2021 academic year. But one thing's for sure: Once those changes are implemented, it'll make an already harrowing process just a bit less difficult.