Online FAFSA Error Makes Low-Income Filers Look Like Millionaires

An update to this year's federal student aid application is causing a major problem for students filing online forms, The Chronicle of Higher Education reported.

For the 2014-15 Free Application for Federal Student Aid (FAFSA), the government expanded several income and asset fields in the online form to accommodate higher incomes, leading to confusion over a decimal quirk. Some lower-income filers are missing the .00 outside the box, and entering cents into the text field. When they do that, an income of $22,852.19, for example, is converted into $2,285,219. If the error is not caught or corrected on individual forms, the filers can lose out on Pell Grants or other need-based student aid.

The problem with the online FAFSA has already affected thousands of borrowers, and is likely to affect more in the future, said Jeff Baker, policy liaison at the Education Department's Office of Federal Student Aid.

"It's a serious problem," Baker continued. "We have to fix it."

So far, the department has identified 165,000 individuals who made the mistake, but there may be more that it has missed. Baker estimated that a majority of colleges have at least one affected student; a few have hundreds. Some of those students have already received their award packages. Colleges will have to reprocess those individuals FAFSAs and notify the students of any revisions in their awards.

 

Related Links

The Chronicle of Higher Education

http://chronicle.com/article/Confusion-Over-New-Federal/147491