Maintained for Historical Purposes

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

How the application is processed

AwardYear: 1996-1997
Edition: PostSecondary
Part: 2 - - The application process for financial aid
SectionNumber:
SectionTitle: How the application is processed

PageNumbers: 31-33


The CPS analyzes the information from the FAFSA and calculates an
EFC to determine how much a student and (if the student is
dependent) his or her parents can be expected to pay toward the
student's education. As discussed in Part 1, the EFC measures the
family's financial strength on the basis of the income and assets of
the student and the dependent student's parents or, if an independent
student is married, the student and his or her spouse. The EFC
formula also takes into account the family's expenses relative to the
number of persons in the household and how many of them will be
attending college during the award year.

If the EFC is less than the cost of attendance, the student is
considered to have FINANCIAL NEED. A student who receives an
EFC of zero may receive the maximum Federal Pell Grant award
depending on the student's cost of attendance and whether he or she
will be enrolled full time for the entire award year. The higher the
EFC, the less the student's need for Federal Pell Grant assistance. If
the student's EFC is above a maximum amount determined each
award year, the student will not receive a Federal Pell Grant but may
be eligible for other assistance.

The CPS automatically calculates a SIMPLIFIED EFC for students
who meet certain income and tax filing requirements. However,
applicants who meet the requirements for the simplified needs test do
not need to provide information about family assets on the
application. The tax filing requirement is the same as in previous
years: Neither the student, the dependent student's parents, nor the
independent student's spouse filed or is required to file an IRS Form
1040. The income requirement is an income of less than $50,000.
Note that this requirement applies to the income of an independent
student and spouse, or to the income of a dependent student's parents,
but the income of a dependent student is not counted towards this
limit.

The formula also provides for an automatic zero EFC for some
students. Applicants who meet the following requirements will
automatically receive a zero EFC:

- for a dependent student, neither parent was required to file a
1995 IRS Form 1040, and the parents' taxable income is
$12,000 or less

- for an independent student with dependents other than a spouse,
neither the student (or spouse) filed or were required to file a
1995 IRS Form 1040, and the student (and spouse's) taxable
income is $12,000 or less.

Independent students with no dependents other than a spouse do not
qualify for an automatic zero EFC.

The CPS uses a series of EDITS to check the consistency of the
student's information. For instance, it would be inconsistent for the
dependent student of a single parent to report income earned from
work for two parents. If the student's information is inconsistent, the
CPS may be unable to calculate the EFC or may calculate an EFC
based on assumptions built into the processing system. If
assumptions have been used, they are indicated on the SAR or ISIR;
the student must make sure the assumptions are correct.

For electronic applications, the financial aid administrator can (if
desired) anticipate certain assumptions the processor will make and
can then correct or override certain information on the student's first
application. Thus, the student's information does not have to be
reprocessed to confirm these assumptions. For example, if the
household size and the number of people in college are equal to each
other and more than two, the processor assumes that the number in
college should be one. In an electronic application, the financial aid
administrator can override this assumption if all members of the
household are in fact enrolled in college. This override allows
information contrary to the assumptions to be confirmed when first
filing through EDE (rather than requiring later confirmation).

The student receives a SAR or SAR Information Acknowledgement
within four weeks of filing an application. (The student's school may
receive this information sooner on an ISIR if the student has
authorized release of the information.) The SAR or SAR Information
Acknowledgement contains the student's EFC and any comments
about the student's application information.


DATA MATCHES

The CPS also performs several eligibility matches with other
databases. If a student's records do not satisfy the eligibility match
requirements of one or more of the databases, the student's records
are flagged. If a student's records are flagged, the student may not be
eligible to receive federal aid unless the discrepancy is resolved.
Resolving such a discrepancy usually requires the student to submit
additional documentation to the school where he or she is applying.

The CPS sends records to the Social Security Administration (SSA)
to check the validity of a student's Social Security Number (SSN). If
the SSN is invalid, the student receives a rejected SAR, and a
comment will appear on the SAR or ISIR instructing him or her to
review the SSN. The student receives a comment on the SAR or ISIR
if the SSN is a valid number but the name and/or date of birth
reported on the FAFSA does not match SSA records.

In 1996-97, the SSN Match with SSA is expanded to compare U.S.
citizenship status reported by the student with SSA citizenship
information. The results of that match appear in the FAA
Information Box on all output documents or records. If SSA does not
confirm a student's claim of U.S. citizenship, a new comment #146 is
present and the SAR "C" flag is set. The student is required to
provide documentation confirming current U.S. citizenship status or
must correct citizenship status.

The CPS also checks the status of eligible noncitizens by conducting
a match with the Immigration and Naturalization Service (INS).
Each eligible noncitizen must provide an Alien Registration Number
so that the CPS can conduct this match with INS.

In addition, the Department maintains the National Student Loan
Data System (NSLDS). This database identifies students who owe an
overpayment on a Federal Pell Grant, Federal Supplemental
Educational Opportunity Grant (FSEOG), or Federal Perkins Loan. It
also identifies students who have defaulted on any Federal Direct
Loan or Federal Family Education Loan, or any other federal student
loan held by a state guaranty agency or by the Department. If a
student is found to owe an overpayment or to be in default and has
not made satisfactory arrangements to repay, he or she receives a
comment on the SAR or ISIR saying he or she is ineligible for aid
until the status is resolved.

The CPS also performs matches against drug abuse conviction
records maintained by the U.S. Department of Justice and
registration status information maintained by the Selective Service
System.

Last Modified: 06/15/1998