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Oops! Feds Forced To Reprocess FAFSA, Again

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Two months after admitting to an embarrassing mix-up with student financial aid applications, the Department of Education has announced that it must reprocess an additional 150,000 applications due to errors that may have cost low-income students thousands of dollars in financial aid.

The new wave of reprocessing, first reported at Inside Higher Ed, is a follow-up to last July, when about 180,000 Free Application for Federal Student Aid (FAFSA) forms were investigated for containing faulty numbers.

The root of both mistakes lies with the format of the online version of FAFSA. Segments of the form require students to report incomes for themselves and their parents, rounding to the nearest dollar and not including cent totals.

Thousands of applicants erred by including a cent total, meaning that a student who earned only $1,000 the year before could be mistakenly logged as having an income of $100,000. Such wild errors could result in destitute prospective students not receiving any financial aid, while other errors led to students receiving more aid than they should have.

The errors have only been discovered and fixed several months later, meaning that thousands of mistaken aid decisions may have been made. The first wave of reprocessing carried out in July, the Education Department said, mostly consisted of applications that were suspected to have been given excessive financial aid.

The latest batch, on the other hand, consists primarily of applicants the government believes may have received less aid than they should have qualified for. Incorrectly inflated incomes may have led to students losing Pell Grants and other aid they were entitled to.

At this point, however, the Education Department’s reprocessing may be too little, too late for thousands of students. With the school year already begun, students may already have chosen alternative schools to make up for financial aid they did not receive, while others may have failed to start school entirely.

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