Student loan debt is an enormous concern in this country. In total, American student loan debt, public and private, stands at $1.7 trillion.
Just thinking about student loans forces me into a cold sweat because I remember the process I went through with my high school senior. I and a handful of other parents sat with glazed-over eyes listening to a guidance counselor go over our “options.” None of us knew what was going on.
Every year parents and students go on to sign the dotted line, take out more debt. About 1/4 of Americans say it's their biggest financial regret.
The student loan process has many flaws. It’s confusing and rushed, and many consider it to be predatory. However, that doesn’t mean you can’t go about it responsibly. You just have to know where to look for help.
Today I spoke with Ebony Holmes, Director of Public Information and Advising for the Louisiana Office of Student Financial Assistance (LOSFA). I asked her how her organization provides aid to those looking to take out loans, and what prospective students and cosigners must be aware of to reduce the debt they accumulate.
(Below is an edited interview)
Tommy Tucker (TT): What’s the difference between LOSFA and FASFA?
Ebony Holmes (EH): LOSFA is the name of our agency. We oversee a lot of the state's financial aid programs in Louisiana. FAFSA is short for Free Application for Federal Student Aid, which includes the application for Pell Grant, for students seeking federal money for their education. Essentially, LOSFA is an agency, and FAFSA is an application for financial aid.
TT: What is the time window for the FAFSA application process?
EH: Typically, the Fafsa opens in October and students complete the Fafsa in their senior year of high school. Toward the end of the year, parents and students should be looking for that application to be open…This year it actually opened last week. So if parents haven’t done the FAFSA, they still have time because it just opened up.
TT: Wasn’t there some big problem with the FAFSA on a national level last year?
EH: You remember correctly. Huge problem. They were intending to make it easier. And unfortunately, the efforts fell flat last year. It was a nightmare scenario on steroids with, technical glitches and students being unable to complete the form. This year, they waited until December but ended up rolling it out a little early. They took the time to fix those glitches so that now it should, in theory, take probably 10 to 15 minutes to complete they reduced it from over 100 questions to 33.
TT What exactly happened last year?
EH: One of the big changes that happened is that Louisiana was the first state to actually make FAFSA completion a graduation requirement. But then that was repealed. So moving forward our 2025 high school graduates are required to complete the FAFSA or a waiver for graduation.
What happened in Louisiana was what we saw nationally with students just not being able to complete the FAFSA because of technical glitches—some students couldn’t get their parent's information onto the form, for example, and it was just rolled out late.
TT: Can the FAFSA help people find out that they actually can afford college when previously they thought they couldn't?
EH: Correct. The FAFSA is a federal form. But we also use it as an application for TOPS (Taylor Opportunity Program for Students). Students can also use the FAFSA to find out if they’re eligible for Pell Grant funding or state aid like the Louisiana Go Grant. Many post-secondary institutions also will ask for a completed FAFSA when they are looking at awarding institutional aid to their students. It’s what I call killing two birds with one stone. You’re applying for many different types of aid just by filling out that one application.
TT: For clarity, we’re talking about grants, correct? Not loans?
EH: That’s right. Many don’t want to do the FAFSA because they don’t want loans. But the FAFSA determines your eligibility for pretty much everything like Pell Grants or FSEOG. You can also find out if you’re eligible for work-study, where the student would be provided a job on campus and they would basically work for a certain amount of financial aid. And then they have student loans. Students always have the option to decline loans. And so that's one of those things where we advise students to only borrow what they need. If they don't need it, they can decline those loans.
TT: How does LOSFA ensure students fill out the FAFSA properly?
EH: In Baton Rouge, we have a lab in our office where students and parents can come in to complete their FAFSA. We also do FAFSA Friday events where students and parents can get assistance with setting up an FSA ID, which is the first step to them accessing the FAFSA. We have virtual office hours where, so if you're not located in Baton Rouge you can still access us. Many schools in the state have already started sending in event requests to have us come out and do FAFSA completion workshops with their students and their parents.
TT: What should parents do from the outset for their kid who’s going to college?
EH: One of the first steps reviewing the institutions they plan to attend to see what’s a good fit depending on their major. Once they've done that, and the FAFSA is open it’s time to start filling out the FAFSA.
However, before applying you need a FSA ID, which is simply a password and a username—that’s your login. It also serves as a signature for them to sign the FAFSA. Once they've created the FSA ID through federal student aid websites. Then in 1-3 days, they’ll get a response saying it's been verified. At this point, they can go ahead and do the FAFSA.
Once they've submitted the application the students going to know right then and there if they're eligible for the federal Pell Grant and the exact amount. Other aid, which is what we call campus-based aid, will be determined by the institution they plan to attend. And so they can list up to 20 schools on the FAFSA. Those schools get a copy of everything they submit on the FAFSA and start packaging aid for that student.
After submission, they can expect to see something in the spring from the post-secondary institutions that they've applied to and been accepted to. They’ll let them know how much they’re eligible for Pell Grants, Go Grants, Work-Study, etc. And so we really advise students that, if you have a couple of offers from a few institutions, sit down and compare those offers to see which place gives you the most bang for their buck. However, for TOPS, our eligibility window is a little bit later. For TOPS, they'll get a separate notification from our office that comes over the summer.