Students applying to college this year will have to wait longer to receive financial aid offers, after continued delays hampered the launch of the new Free Application for Federal Student Aid (FAFSA).
The Department of Education won’t be able to start sending FAFSA applicant information to colleges until March, officials said in a news conference with reporters Tuesday. This delays the already stalled FAFSA rollout by another two months and is expected to set off a domino effect for financial aid and admissions deadlines set by colleges.
“We are updating institutions and states to let them know that they will begin receiving FAFSA information in batches in the first half of March,” said Education Under Secretary James Kvaal, on the call. Colleges had expected to begin receiving the information – critical to processing financial aid award letters to prospective students – by the end of January.
Allie Arcese, spokeswoman for the National Association of Nonprofit Financial Aid Administrators, was particularly struck by the wording “in batches,” meaning the exact timing colleges will receive All the information they need to submit financial aid offers remains unclear.
Even after colleges receive what they need from the department, Arcese says it takes several additional weeks to submit financial aid offers, which also take into account grants and scholarships from the school and the state.
“Delaying the delivery of this information until March means students will have to wait even longer to receive their offers of help,” Arcese says. “Maybe until April.”
What’s the FAFSA heist this time?
The new timeline is the latest in a series of delays that have roiled the implementation of the 2024-25 FAFSA, which has undergone several changes aimed at streamlining the process of applying for financial aid. This particular setback was caused by a miscalculation in how the Department of Education determines the amount of money applicants will receive.
In addition to streamlining the applications families see, there have also been a number of behind-the-scenes changes to the formula this year, including a directive to update the guidelines used to calculate financial aid eligibility to account for inflation. But the department — already months behind in issuing the FAFSA because of the revamp — failed to make the inflation adjustment in the race to get the form online by the legally mandated deadline for the new year.
Last week, NPR reported that the Education Department decided to fix the mistake, a $1.8 billion oversight, for the 2024-25 academic year after all. The department confirmed this on Tuesday and added that it would do so Before send financial aid information to colleges, thus pushing the date back to March.
“These are truly unprecedented changes,” said a senior department official.
The official pointed out that the department was tasked by Congress to review the FAFSA while overseeing the return to student loan payments and the development of new student loan servicer contracts, all without any of the $600 million that the department declared necessary to carry out the tasks.
“We are certainly working with a very high workload created by Congress and without additional resources,” the official said.
Ripple effects of delayed aid
FAFSA delays are causing major headaches, especially for prospective college students and their families.
For many students, financial aid makes the difference between “not just Where you can afford to go to college, but self you can afford to go to college,” said Jon Fansmith, senior vice president of the nonprofit American Council on Education, in a recent interview with Money.
The latest government data shows that 87% of first-time students rely on financial aid to pay for university. Overall, approximately 20 million students fill out the FAFSA each year to see if they are eligible to receive higher education aid, such as grants, scholarships and student loans.
In normal application cycles, most applicants receive offers in March and sometimes as early as the fall of the previous year. Families need time to review the amount of aid and compare offers before deciding where to enroll.
As College Decision Day approaches, unofficially May 1, some college applicants may now have just a few weeks — not months — to choose their college.
Even before the latest delay came to light, some states and universities had already begun postponing their financial aid and admissions deadlines.
“So it stands to reason that many others could follow suit given today’s news,” Arcese says.
In addition to the delays, many applicants have experienced technical issues since the FAFSA fully opened earlier this month. For example, parents without Social Security numbers cannot contribute to or initiate the FAFSA, even when invited.
The Education Department said Tuesday that officials are “very aware of this issue” and are working to resolve it.
Despite the difficult implementation, more than 3 million FAFSA applications have been submitted, the department says.
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