Submitting a FAFSA early will give students more time to review financial aid and choose an affordable college.
A recent survey of college enrollment and financial aid practices, conducted by Ruffalo Noel Levits, showed that Free Application for Federal Student Aid submissions increased 15.8 percent in the 2016 award year compared with the previous year.
And according to a different survey, most schools mailed financial aid awards earlier than in previous years.
These changes aren’t surprising, considering the FAFSA updates that went into effect last year, including that the form is available three months earlier. However, they reinforce the necessity of completing aid applications early.
Institutional aid is offered on a first-come, first-served basis. For financial aid applicants, that means the early FAFSA filer may borrow fewer student loans.[Learn what you need to know about FAFSA changes.]
Former FAFSA Process
College students have always been told to complete the FAFSA as early as possible. This proved to be difficult in previous years because they were required to provide the previous tax year’s information to do so even though they hadn’t received any tax documents at that time.
As such, students and families had to estimate information and correct it after receiving their tax transcript. This tended to lead to two problems.
First, many students and families forgot to correct the FAFSA until they received their fall bill with a much larger balance than expected. At that point, there was little time to send their tax transcript to the school, receive a new award and cover the balance. This led many students to just borrow loans instead of taking the time to find the most affordable option.
Other families waited to complete the FAFSA until they had their tax returns. This was – and remains – a serious problem for any borrowers who want grant aid from both the school and the state they live in.
Schools have priority filing deadlines. If you miss that deadline, you are still eligible for aid, but less is available. Check with your school for the priority filing deadline and be sure you submit the FAFSA by that deadline.
FAFSA Process Changes
To address these issues, in 2016, the Department of Education moved the FAFSA application process start date up by three months to Oct. 1. The department hoped this would provide students and families more time to apply and allow schools to evaluate aid applications earlier, giving students more time to determine their most affordable options. Based on last year’s results, these changes have been good.
In conjunction with lengthening the application season, FAFSA filers now provide income and tax information from two years before the academic year start or the “prior prior year.” With few exceptions, students should have the prior prior year’s tax information readily available by Oct. 1, allowing them to complete the FAFSA with accurate data.
Why This Matters Now
High school seniors may have just returned to school for their final year, but college application season is here. You may be focused on which college to attend, but you now also need to consider how you’ll pay for your education – and earlier than ever, because other students are doing that.
As mentioned above, institutional aid is typically awarded on a first-come, first-served basis. The same goes for state grants.
If you miss a state filing deadline, you likely will not be considered for grant aid at all that year, so be sure to check the FAFSA site for your state filing deadline.
If deposits aren’t due until May and you receive your award in January, you can explore other options and think long and hard about taking out large student loans. Perhaps it makes more sense to see if there’s a more affordable college for you.
The extended FAFSA application window provides students and families more time to determine what college is the best financial fit – provided you take advantage of it.
(Courtesy of Ashley Norwood, US News)