Maintained for Historical Purposes

This resource is being maintained for historical purposes only and is not currently applicable.

Student Eligibility and Financial Need - Introduction

AwardYear: 1997-1998
EnterChapterNo: 2
EnterChapterTitle: Student Eligibility and Financial Need
SectionTitle: Introduction
PageNumbers: 1-2


This chapter of The Federal Student Financial Aid Handbook
describes the student eligibility requirements that affect the Student
Financial Assistance (SFA) Programs. The calculation of financial
need, a key determinant of student eligibility, is examined here, as
are the details that pertain to documenting citizenship status and
other eligibility criteria. Documentation necessary for proving
citizenship status, information on eligibility matches, and the
Selective Service's Status Information Letters appear in the

[[Output document]]
Schools and students receive information about the student's
eligibility from the Central Processing System (CPS) on several
different types of documents. These documents are the Student Aid
Report (SAR) and SAR Information Acknowledgement, which are
sent directly to the student, and the Institutional Student Information
Record (ISIR), which is sent to schools either through the Electronic
Data Exchange (EDE) or on tapes and cartridges. Throughout this
chapter, we will use the term output document to refer to all of these
CPS-produced documents.

[[Record retention]]
Schools are required to document that a student meets the eligibility
requirements described in this chapter, and so must keep certain
documents, such as output documents or financial aid history
information. Although this chapter mentions some items that must be
documented, Chapter 3, Section 7 has a detailed discussion of which
records must be kept and how long they must be retained.

[[Conflicting information]]
A school is also required to reconcile any conflicting information it
has about a student's eligibility before it pays the student. The school
must consider all information available to it, not just the information
on the Free Application for Federal Student Aid (FAFSA). If a
school has conflicting information about a student or reason to
believe the application information is incorrect, it must resolve the
discrepancy before disbursing federal student aid. (See The
Verification Guide for more about the general requirement to
reconcile all conflicting information.)


There have been only a few major changes relating to student
eligibility for the 1997-98 award year. Some of the noteworthy
changes for 1997-98 are:

- Higher loan limits are available to certain students enrolled in
preparatory coursework for graduate programs (see "Enrollment as
a Regular Student in an Eligible Program" in Section 1).

- Ability-to-benefit regulations that took effect on July 1, 1996
govern the approval and administration of tests used to determine
a student's eligibility; the Department has approved new tests
under these rules (see "High School Diploma; Ability to Benefit"
in Section 1).

- There have been some changes to the information provided from
the National Student Loan Data System (NSLDS) on the SAR and
ISIR to help aid administrators use the NSLDS system more
effectively(see Section 2).

- The Personal Responsibility and Work Opportunity Reconciliation
Act of 1996, enacted August 22, 1996, has excluded noncitizens
with "family unity" status from SFA eligibility (see Appendix A).

There have also been changes to the application processing system,
some of which are noted in this chapter. For detailed information
about the processing changes, and the processing system in general,
see A Guide to 1997-98 SARs and ISIRs and the 1997-98
Counselor's Handbook for Postsecondary Schools.

Last Modified: 02/08/1998