The Department of Education announced last week that upward of 30% of FAFSAs that had been submitted to date will need to be reprocessed due to errors.
While the Department has been making some updates to the FAFSA process (for example, FAFSA corrections opened over the weekend for brief periods), many families are struggling to navigate this process.
Due to the delays and incorrect Student Aid Index calculations, college financial aid offices have been unable to get financial aid award letters out to families. With enrollment deadlines looming, families are stuck facing a big financial decision with many unknowns.
FAFSA Reprocessing Timelines
The Department of Education has acknowledged that it has cleared through the backlog of FAFSA submissions that started in late-December 2023. In a letter to college presidents, Education Secretary Miguel Cardona said, “Students who apply and submit a FAFSA form can be confident that their record will arrive to their school within one to three days.”
However, that’s not the case for the 30% of families who have errors on their FAFSA. The errors have emerged in various ways, relating to calculations on the FAFSA with the FAFSA processing system, to data errors relating to the IRS import of prior year tax data.
The end result is that families are getting incorrect SAIs – which could hinder their ability to receive aid.
For errors resulting from the FAFSA system, the Department of Education is starting to reprocess those FAFSAs the week of April 15. However, the Department has cautioned that this batch of errors may reduce financial aid eligibility.
For errors resulting from the IRS import system (which is approximately 20% of FAFSA forms), the Department of Education hopes to being reprocessing them by late April, and sending all reprocessed forms to colleges by May 1. However, this resolution has a “will keep you updated on our progress” notation – which is a red flag that this could be delayed longer.
The Department of Education has said that reprocessing the IRS-related issues could result in many of these applications to receive more financial aid.
What Can Families Do Now?
The FAFSA failures are leaving many families in financial limbo as many colleges have enrollment deadlines approaching. May 1 is historically “Decision Day”, where families nationwide are expected to make an enrollment decision. But without knowing what price they will even pay for college, this can be challenging.
Some colleges have delayed Decision Day, but not for long. Common postponement deadlines are only until May 15 or May 31. Families should check with their college and see what the actual deadline is for this year.
Some schools may also have different deadlines for new versus existing students.
For families that don’t know the net price yet because they are waiting on a financial aid award letter, I recommend you delay until the last possible moment before committing to a college. College is a major investment, and you should not enroll without knowing your full financial aid picture.
If you are one of the unlucky families stuck in limbo due to FAFSA reprocessing, you should reach out to your college and see if they will allow you more time to make a decision once you have your financial aid award.
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