Maintained for Historical Purposes

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

Using the official EFC to document eligibility

AwardYear: 1997-1998
Edition: PostSecondary
Part: 2 - - The application process for financial aid
SectionTitle: Using the official EFC to document eligibility

PageNumbers: 42-43

Using the official EFC to document eligibility

The "official" EFC is calculated by the CPS, using the CPS edits and
eligibility matches, and is printed at the top of the first page of the
SAR. The EFC, 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 ISIR. An EFC from a source
other than the CPS is considered an estimated figure and cannot be
used for payment.

When a student qualifies for the simplified needs test, a primary and
secondary EFC are calculated. The simplified EFC is the primary,
and is printed on the front of Parts 1 and 2 of the SAR. Both the
primary EFC and the secondary EFC (calculated by including the
supplemental data) are printed at the top of the "School Use Only"

The need to use the Secondary EFC should be very rare. If you need
to use the Secondary EFC in determining the student's Federal Pell
Grant, you must indicate this when you report the payment through
EDE, RDE, or the Floppy Disk Data Exchange.

Payment for a Federal Pell Grant must be based on the student's
official EFC, and any data changes that result in a changed award
must be resubmitted through the CPS. Ultimately, to document a
student's eligibility for a Pell Grant, you must have in your records
the student's final EFC and the correct application data used to
calculate that EFC
. The student's valid SAR or ISIR serves as this
eligibility document or record (a valid SAR is one on which all the
information used to calculate the EFC is correct). However, please
note that a copy of an ISIR sent by a student or school to another school
does not constitute a valid eligibility document; the ISIR must be sent
directly from the CPS to each institution.

For the federal campus-based, Federal Direct Loan, and FFEL
programs (except PLUS), you must have in your files at least one
output record for the student containing an official EFC and data
processed by the CPS: either a SAR or an ISIR. This output
document or record 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 gone through system edits and the eligibility matches.

You may not make payments based on an estimated EFC (an
EFC from a source other than 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, Federal Direct Loan, or
FFEL funds based on your EFC recalculation. Or, you may choose to
obtain a new official EFC from the CPS by making changes through
EDE or by having the student submit a corrected SAR.

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 does not certify
the accuracy of the calculations performed by need analysis
servicers. The Need Analysis System (NAS) program calculates 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 NAS.

To receive the 1997-98 NAS specifications, all interested need
analysis servicers must enter into an agreement with the Department
and comply with the procedures set forth in that agreement. The
agreement must be completed and signed by new servicers in order
to receive the NAS specifications, which are sent automatically to
current NAS servicers.

Under the Federal Pell Grant Program regulations, schools are not
allowed to make a first disbursement of a Pell award without a valid
SAR or ISIR. However, you may still make an interim disbursement
to a student who is selected for verification (including a student
selected for verification by the school rather than the CPS). See The
1997-98 Verification Guide for more information.

If a student is not selected for verification, you may not make a
disbursement to the student until you have a valid SAR (or SAR
Information Acknowledgement) or ISIR. If the student needs to
make corrections to his or her data, or if you wish to use professional
judgment to adjust the student's data, you must submit the student's
SAR for reprocessing (using Part 2), or make the changes through
EDE and receive the new SAR or ISIR before making a first

Last Modified: 12/02/1999