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How to Avoid Financial Aid Oversights

Many low-income and first-generation students don’t have anyone in their families to help give them advice on the next steps to prepare them for college. Every year, high school grads walk away from billions — as much as $2.6 billion in 2018 — in free federal grant money that could help pay for college, according to NerdWallet. Communities In Schools wants to make sure students avoid three FAFSA oversights that could cause them to lose out on free money for college.

Oversight No. 1: Skipping the financial-aid process

You will hear guidance counselors shout at the top of their lungs, reminding you to apply for FAFSA. FAFSA is an acronym that stands for the Free Application for Federal Student Aid. It’s completely free of charge, and you apply online at https://studentaid.ed.gov/sa/fafsa, and on paper, but the process is longer. Make sure you only apply on this official website because there are individuals and companies that create fake websites to steal your social security information, address, and other personal information.

The reason why students don’t apply for FAFSA is because they are misinformed and think that loans are the only thing they can get when they apply for financial aid. There are several different types of financial aid ranging from the Pell Grant, work-study, and low-interest loans. The Federal Pell Grant Program provides need-based grants to low-income undergraduate and certain post baccalaureate students to promote access to post-secondary education, and they don’t need to be paid back. Work-Study allows students to work on their college campus and get paid, and usually, your supervisors are willing to work with your class schedule, so that you can still make an income while being a student. Low-interest loans is a personal loan that interest rate falls within a specific range.

 Oversight No. 2 -Failing to Add Colleges to FAFSA

Many students skip the entire section of the FAFSA that requires them to select ten colleges or technical schools that they would attend in the upcoming semester. You need to make sure these are schools that you have applied for. It’s always a good rule of thumb to add a local community college as an option for school selection. If you don’t add the school to the list, then they won’t have access to your financial aid package that you would receive for the year. To add a school, follow these simple steps.

  1. Find your college’s Federal School Code.

If you don’t know the school code, you can easily search for your school through the FAFSA application. You will have to make sure to input the state that the school is located because some schools have the same name but are in different states. Make sure to put in the state and city and then click “Search.”

  1. Choose your school

Identify the school on the list that appears after you search it and then select the school of your choice.

  1. Choose your housing options.

You will have three options to choose from off campus, on campus, or with parents. This is only asked to help your college award you with the correct amount of financial aid based on the living arrangements that you will have as a college student.

  1. Repeat for all the schools you want to add.

Oversight No. 3 – Not utilizing the IRS Data Retrieval Tool

Within the FAFSA application, the IRS Data Retrieval Tool allows students to upload their family’s tax information automatically from the IRS, which reduces errors in the financial information section of the form. If the schools you selected see that the information you have added in your FAFSA application doesn’t match the numbers, the IRS has on file.  Unfortunately, you will end up being selected for financial aid verification and this process can be a nightmare, you will be required to complete the IRS Form 4506-T. If that documentation isn’t enough, they will ask you for more documentation, which will make you have to take a few trips to the IRS building, which can be a headache. Also, don’t guess or round any tax information because lying on the FAFSA counts as fraud. If you need help, seek advice and assistance from college advisors or high school guidance counselors regarding the financial aid process.