The government plays Hungry Hungry Hippos with paperwork. [Note: the government does not actually crouch in their offices and play Hungry Hungry Hippos…I think.] They eat up as much paperwork as they possibly can, so it can be daunting to apply when they insist on getting your autobiography to simply be considered for a loan. We are not even talking about guaranteed money, and they want to know about the bicycle accident when you were seven.

But since knowing all this stuff practically takes a financial guru, which, by the way, we have [shameless plug], let me try to make it a little easier.

There are three main types of federal loans: Federal Perkins Loan, Stafford Loans, and PLUS Loans. The government uses the FAFSA across the board to apply for loans. The FAFSA application becomes available every January, and deadlines can vary by school.  In order to receive federal loans, you must apply every year. Each loan has its own eligibility requirements and monetary limits, and along with details of each loan, FAFSA offers guidelines on repayment as well as solutions to repayment problems, including repayment plans, consolidation, cancelation, deferment, and forbearance. (Egh! Just hearing those words fills me with dread.)

However, despite the work, federal loans are well worth the time because it can end up saving you thousands of dollars in the end compared to private loans, especially if you can demonstrate financial need. This is not to say that people without financial need cannot get loans but demonstrating financial need can get you an even better deal. Students with or without financial need are eligible for federal loans, and it’s to your financial advantage to exhaust that outlet before seeking other methods for payment. (No one wants to become manure for Lenny the Loanshark’s garden.)