Part: 2 - - The Application Process for Financial Aid
SectionTitle: Using the Official EFC to Document Eligibility
The "official" EFC is the EFC calculated by the CPS, using the CPS
edits and eligibility matches. The EFC printed at the top of the first
page of the SAR, the secondary EFC, and the alternate EFCs printed
in the "FAA Information" section of the SAR, are all considered
"official" figures that can be used for payment. The CPS may
provide the school with an official EFC on an ESAR, an ISIR, or
cartridge. The official, CPS-produced EFC may also be provided on
a nonfederal output document produced by one of the FAFSA
processors as a part of its proprietary services. An EFC from a
source other than the CPS or in some instances a FAFSA processor,
is considered an estimated figure.
An applicant for federal student aid must first send a FAFSA to one
of the four approved application processors to determine eligibility.
The only exception to this rule is students who are applying only for
a PLUS loan. Thus, every applicant for federal student aid will have
passed through the CPS's eligibility matches and will have received
an official EFC.
Payment for a Federal Pell Grant must be based on the student's
official EFC, and any recalculation of the EFC must be resubmitted
through the CPS to establish eligibility for a Pell payment.
Ultimately, you must have in your records THE STUDENT'S
FINAL, CORRECT APPLICATION DATA AND EFC FROM THE
FEDERAL CPS to document the student's eligibility for the Federal
The student's valid SAR may serve as the eligibility document, or a
signed copy of the student's application information and EFC from
the CPS may be used. Your school may receive this information
from the CPS through EDE, on an ISIR. If the eligibility document
is an ESAR or ISIR the document must be signed by the student to
confirm that the student has had an opportunity to review the
information. (See the discussion of signature requirements later in
this Part.) You may request that the student bring the SAR to the
school, but you may not REQUIRE that the student submit a SAR, if
the student can establish eligibility for payment by signing an ESAR
or ISIR or printout with the official EFC and final, correct
application information from the CPS. If your school does not
receive ISIRs from the CPS and does not participate in EDE, you
must obtain a paper SAR for each of your Federal Pell Grant
For the federal campus-based and FFEL programs (except PLUS),
you must have in your records at least one output document for the
student containing an official EFC and data processed by the CPS: a
SAR, ESAR, ISIR. This output document need not be signed, and it
need not contain the final, corrected or adjusted data for that
student. It merely documents that the student's data has been
processed through the CPS and has been verified through system
edits and the eligibility matches.
You may not make payments based on an ESTIMATED EFC that is
provided on a nonfederal output document or from another source.
(For example, in some cases a FAFSA processor will provide an
estimated EFC on its proprietary, nonfederal output document for an
applicant who was rejected by the CPS.) Packaging can be based on
an estimated EFC and a loan application can be certified with an
estimated figure, but funds cannot be delivered until the school has
received an official EFC from the CPS. If you have received the
official EFC but need to correct or adjust the student's information,
you may pay the student campus-based or FFEL funds based on your
recalculation of the EFC. Or, you may choose to obtain a new
official EFC from the CPS by making changes through EDE or
having the student submit a corrected SAR to the FAFSA processor.
The school is liable for any recalculation errors that result from
using an EFC that was calculated at the school or through a need
analysis servicer. Schools should note that the Department no
longer certifies the accuracy of the calculations performed by need
analysis servicers. However, the Department will distribute copies
of its Electronic Need Analysis System (ENAS) to postsecondary
schools prior to the beginning of the 1994-95 award year. The
ENAS program will calculate the same EFC as the CPS; however,
the student's information must be processed by the CPS at least
once, because the eligibility matches cannot be performed by ENAS.
You may make a first payment of a Federal Pell Grant to an eligible
student without having the final documentation of eligibility, under
the following circumstances.
- EFC ON NONFEDERAL OUTPUT DOCUMENT. You may
make a first disbursement of a Federal Pell Grant to the student
before you have received a SAR or other output document from
the CPS if you have received a nonfederal output document
from one of the FAFSA processors that contains the student's
information and EFC as processed by the CPS. Please
remember that this nonfederal output document does not serve
as final documentation of eligibility for a Federal Pell Grant.
- CORRECTING DATA FOR A FEDERAL PELL GRANT. If
you have received the student's information and EFC, as
processed by the CPS,*4* but there is an error, you may
recalculate the EFC at your school and make a first payment of
a Federal Pell Grant based on that recalculation. If you are
making the correction on a paper SAR, you must report the
recalculated EFC in the "School Use Only" box on the back of
Part 2 of the SAR (as shown later in this Part), fill in the Title
IV Institution Number for the school, and sign on the
designated signature line. The recalculation must be based
solely on the correct information that the student reports in
accordance with the instructions on the application.
- PROFESSIONAL JUDGMENT FOR A FEDERAL PELL
GRANT. If you have received the student's information and
EFC, as processed by the CPS,*4* but you wish to use
professional judgment to adjust the student's data, you may
adjust the EFC at your school and make a first payment of a
Federal Pell Grant based on that adjustment. The "School Use
Only" box on the back of Part 2 of the SAR is also used when
reporting the use of professional judgment to adjust a data
element used to calculate the EFC. Report the EFC that you
have adjusted in the spaces provided for "FAA EFC
Adjustment," and fill in the Title IV Institution Number for the
school and sign. If you are using the EDE, you must enter the
adjusted EFC in the "Office Use" section, next to the
abbreviation "Adj EFC."
Once the "first payment" option has been used, no further payments
can be made to the student until the student brings you the valid
SAR, or signs an ESAR or ISIR of the corrected/updated/adjusted
EFC and application information from the CPS. Both the school
and the student are liable for the first payment if the school does not
ultimately receive the final documentation of the student's eligibility
for payment within the established deadlines.
There are two situations in which the option of using a first payment
cannot be used:
- CHANGE IN DEPENDENCY STATUS. If the student's
dependency status changes, the student may submit an entirely
new application (the Correction FAFSA), or use the SAR
- NO OFFICIAL EFC. No payment can be made if the student
did not receive an official EFC. For example, if the student
received a rejected SAR, the information is incomplete and the
SAR does not provide a calculated EFC for the student.
There is no "first payment" option, per se, for the campus-based and
FFEL programs. Once you have received the student's EFC and
application information, as processed by the CPS,*5* you may make
all payments for which the student is eligible. As we mentioned
earlier, you are not required to resubmit corrections or adjustments
to the FAFSA processor or CPS for recalculation of the EFC if the
student is only eligible for federal campus-based or FFEL funds.
An EFC with an asterisk (*) beside it means that the student has
been selected by the Department for verification. If the student has
been selected for verification, but verification has not been
completed, you have other first payment options, as described in The
Verification Guide, 1994-95.
Signature Requirements (Federal Pell Grant)
THE SIGNATURE REQUIREMENTS FOR THE SAR) AND
OTHER OUTPUT DOCUMENTS ENSURE THAT THE
STUDENT (AND, IF NECESSARY, THE STUDENT'S SPOUSE
AND PARENTS) HAVE HAD AN OPPORTUNITY TO REVIEW
THE PROCESSED APPLICATION INFORMATION FOR
ACCURACY. THESE SIGNATURE REQUIREMENTS APPLY
TO RECIPIENTS OF FEDERAL PELL GRANTS ONLY.
If the student submits a paper SAR, he or she must sign a statement
certifying that the information for household size, number in
college, and dependency status has not changed since the time the
application was filed, unless there were changes as a result of
marital status. This statement is printed with other certifications on
the SAR, but it may be collected, with or without the other
certifications, on a separate sheet of paper. If the school has
received the student's information through EDE, the student must
sign the certification statements on an attachment to the ESAR
printout, including a statement confirming the accuracy of the
information on the ESAR.
If a line item on a paper SAR is CORRECTED, the student and the
student's spouse and at least one parent (for a dependent student)
must sign Part 2 of the SAR before it is returned to the FAFSA
processor. If the FAA indicates that one or more line items on the
SAR have been ADJUSTED, the adjustment(s) can be processed
without the signatures of the student, spouse, and parent. For
changes that are received through EDE, the student, spouse, and
parent must sign the certification attesting to the accuracy of the
ESAR if corrections were made to the application information--if an
adjustment was made, only the student need sign the certification.
For the 1994-95 award year, a student may also establish eligibility
for a Federal Pell Grant by signing a statement that he or she has
reviewed the EFC and application information provided by the CPS
on an ISIR. Unlike the SAR, tapes and paper rosters do not include
the certification statements that attest to the accuracy of the
information. A school may collect the certification statements on a
separate sheet of paper. A model statement that includes other
necessary certifications is provided on the next page.*6*
For ISIRs printed from FULL-DATA TAPES, a school may collect
the certifications on a separate sheet of paper, or it may provide the
certification and signature blocks in its computer programs so that,
when it generates a paper copy of a student's information, the
certification and signatures appear on that printout.
If no corrections have been made, only the student need sign the
certification statements attesting to the accuracy of the information
on the ISIR.
Finally, bear in mind that if the student is submitting an
ELECTRONIC APPLICATION or electronic correction application,
you must obtain the student's signature on a completed paper
application or on the "echo document" printed from an electronic
FAFSA that is filed through EDE, and keep it in your files even if
the student does not receive federal student aid. For your reference,
we are including below a model statement that can be used to collect
these signatures when such a statement is not provided ont he ISIR.
Please note that this statement includes additional eligibility
certifications relating to Educational Purpose, Registration Status,
and Refunds nd Defaults. (These requirements are discussed in
Chapter 2 of the Federal Student Financial Aid Handbook, 1993-
[[Part of page 48 and all of page 49 are currently unavailable for
viewing. Please reference your paper document for additional
*4* The CPS-produced information must be received on a SAR,
ESAR, ISIR, cartridges or diskette.
*5* The CPS-produced information must be received on a SAR,
ESAR, paper roster, electronic tape or cartridge.
*6* The model statement may be used to collect certifications that
are required for all of the student aid programs, such as the
Statement of Educational Purpose. Please note that the student may
be required to sign the Statement of Updated Information for the
campus-based and FFEL programs for verification requirements.