If you filled out an online FAFSA before 2009, you probably noticed the process took about an hour. You were inundated with questions that didn't apply to you. This is because the online application didn't interact with your responses to the questions - at all.

The old FAFSA was basically the full paper form online. You had to scroll through the full application to find the questions you needed to answer. For example, if you answered yes to any of a series of questions about being an independent student, the instructions would say skip questions about parental incomes. Fortunately, the form changed slowly throughout 2009 to streamline the process. It's now easier to use and will provide more direct feedback about how much financial aid a particular student is eligible to receive. (Not all student loans are the same. Know what you're getting into before signing on the dotted line, read College Loans: Private Vs. Federal.)

Why The Application Changed
Many potential borrowers thought the process of applying for student aid was too complicated. Over a hundred questions seemed more like an endurance test than a way to get student aid. Thus, the Department of Education redesigned the online application to be more responsive to students' answers. In 2009, the Department of Education estimates that there are more than 1.5 million students who are eligible to apply for student aid but will not fill out a form.

Time line of Changes

May 2009
After completing the FAFSA, instant access is granted for Pell Grant and student loan eligibility. This is far different than before when aid eligibility came weeks later. With this change, students get a realistic sense of what they can afford based on their potential financial aid package sooner, allowing them to evaluate potential colleges earlier. Links to research college graduation rates and other college info is also provided. (Learning to manage your money is no easy task, but there are plenty of resources designed especially to help, see Free Financial Counseling Programs For Students.)

While the exact amounts of aid that will be disbursed is determined by the college to which the student applies, knowing whether they are eligible for grants is a big help for students. In addition to grant eligibility, providing this information early also helps borrowers who had a default to make payment arrangements and recover from default before the school year starts. (For tips on how to avoid default before it happens, check out Loan Deferment Saves Students From Disaster.)

FAFSA Changes
In summer 2009, skip-logic technology was added to FAFSA applications to allow borrowers to skip questions that don't apply to them. For instance, if you qualify as an independent student where your parents' income no longer affects your financial aid eligibility, the form no longer shows parental questions on the screen. In spring of 2010, borrowers applying in January of 2010 won't have to enter income information from their or their parents' tax returns into the form - it will be directly imported into their FAFSA applications from the numbers the IRS already has.

How the Changes Affect Borrowers
In addition to the benefits previously mentioned for independent students and all borrowers getting financial aid eligibility information faster, borrowers meeting certain income qualifications will no longer have to gather information about assets such as family farm ownership and investments before filling out the form.

The qualifications for borrows who don't have to provide asset information on their 2009/2010 form is an adjusted gross income of $50,000 or less for parents of dependent students or for independent students.

What Information Is Needed to Fill Out the 2009 Form?
If you fill out a FAFSA in 2009, you should have the following information handy:

How is the student aid report delivered?
If you provided an email address, you will receive your 10-page student report with everything you inputted in your form plus basic aid eligibility information via a link sent to your email inbox. Otherwise, this information will be sent via U.S. mail.

The Bottom Line
Student borrowers from 2009 on don't have to endure the FAFSA treadmill application process. Now, the computer program skips dozens of questions based on the student's individual situation. While the application marathon has been cut to a sprint, the real cherry on top is getting aid eligibility faster. Thanks to these changes, aid borrowers will know if they are eligible for grants and student loans almost instantly and can focus more on campus visits, rather than nervously waiting for their student aid reports to arrive.

For further information go to on the Free Application for Federal student Aid (FAFSA) go to www.finaid.gov, www.fafsa.ed.gov or call 1-800-4-FED-AID. To learn more, read Pay For College Without Selling A Kidney.

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