In order to receive federal financial aid and most state financial aid, an applicant must meet several eligibility requirements that are determined by the information submitted on the FAFSA and then by the college after it receives the output from the FAFSA and review of their records.
An applicant must:
- qualify for financial need (except for certain loans and some state gift assistance programs)
- have a high school diploma or a General Education Development (GED) certificate, or pass a test approved by the U.S. Department of Education (ED)
- be working toward a degree or certificate
- be enrolled in an eligible program
- be a U.S. citizen or eligible non-citizen
- have a valid Social Security Number
- register with the Selective Service if required
- maintain satisfactory academic progress once in school
After a FAFSA (electronic or paper) is submitted to the Central Processing System (CPS), a series of matches are conducted with other federal agencies to verify information (i.e., Social Security Number and citizenship status) then various edits are applied to the application information to determine an applicant’s Expected Family Contribution (EFC). A Student Aid Report (SAR) is sent to the applicant. An Institutional Student Information Record (ISIR) is sent to all of the colleges listed on the FAFSA, listing the EFC and comment codes in the FAA section about match results and information that impacts eligibility for federal student aid.
Once a college receives the student’s FAFSA information (including a valid EFC) and calculates aid eligibility, an award package for the student’s aid can be determined. Students who may be ineligible for federal aid should still complete the FAFSA, as they may be eligible for nonfederal aid from states and private institutions.
The Federal School Code information on the SAR is the same as in 2019-20. Applicants will continue to receive SARs that list all the Federal School Codes selected on each transaction and will continue to have the same options for entering, updating, and viewing college choices on FAFSA on the Web or on a paper SAR. FAAs will see only their college information (Federal School Code, Name, and Housing Plans) in FAA Correction Entry, Student Inquiry, and ISIR Compare and on the eSAR (PDF and HTML). State Agencies will also receive ISIRs listing all of the federal school codes selected on each transaction.
When an application is received by the CPS, a database match is conducted with several other federal agencies on the following items:
- Social Security number (SSN) of the student & parent, if applicable, with the Social Security Administration (SSA)
- Citizenship and immigration status with the SSA and the Department of Homeland Security (DHS)
- Selective Service Registration with the SSA
- Drug-Related and conviction information with the Department of Justice (DOJ)
- Veteran Status with the Veteran’s Administration (VA)
- Applicant’s parent was a member of the Armed Forces who died as a result of service in Iraq or Afghanistan after September 11, 2001, with the Department of Defense (DOD)
- Default or Overpayment, exceeded loan borrowing limits and financial aid history with the National Student Loan Database System (NSLDS)
After the matches are conducted, the CPS calculates an EFC based on the FAFSA information. The EFC is a measure of how much the student and his or her family can be expected to contribute to the cost of the student's education for the year. The EFC is calculated according to a formula specified in the federal law.
The EFC is determined by the family's income, assets and size, and takes into consideration the family's living expenses and the number of family members enrolled in college. The EFC is not a lump sum amount due at the beginning of a school year but rather, a measure of the family's ability over time to absorb some of the educational costs.
Unless the FAFSA is rejected, an EFC will be listed in the upper right-hand corner of the SAR/ISIR. The EFC may be followed by a “C” indicating there is a discrepancy with one of the matches. A corresponding comment code will be included in the FAA section. If certain conditions are met, the FAFSA is rejected and an EFC is not calculated. When the school receives the ISIR, the reject reason comment code will be listed in the FAA section.
The college will receive an ISIR that provides an EFC and comments that must be resolved before aid can be disbursed. In addition to the EFC, which is one component used to determine if an applicant qualifies for financial aid, there are school-determined initial and continuing eligibility requirements.
- Regular student in an eligible program
- Academic Qualifications (high school diploma or equivalent)
- Satisfactory Academic Progress
- Enrollment Status
- Drug-Related Convictions
- Conflicting information
Information in the school files and application processing conflicts must be resolved before Federal Student Aid (FSA) funds can be disbursed. Comment codes that need to be resolved will be listed in the FAA section of the ISIR. Refer to the chapters in SFA Handbook Volume 1 – Student Eligibility and the 2020-21 SAR Comment Codes and Text Guide for details about the matches and conflict resolution.
An EFC is not valid until all conflicting information has been resolved. These are a few of the possible conflicts that can occur.
- Information on the FAFSA is missing, in conflict with other reported information or is assumed.
- An application will be rejected if required signatures are missing or there is a conflict with any of the matches. An EFC is not produced on a rejected application. Refer to the 2020-21 SAR Comment Code & Text Guide for a complete list of reject codes. Use the correction process to submit the resolved information and obtain a valid EFC.
- A “C” code will be printed next to the EFC on the SAR for any of the conditions described in the charts in the Data Base Match Results section (pages 146-156) of the SAR Comment Code & Text Guide. Until the problem is resolved, the school cannot disburse FSA funds or certify or originate a loan. Some of the data match results generate a rejected record.
- An asterisk (*) in the Match Flag column indicates that a match flag value is not generated for cases that could not be sent to the matching agency. A blank value code was added to indicate that the records were not sent to match or the match wasn’t performed. The school must resolve the conflict before disbursing aid.
- An asterisk (*) after the EFC indicates the CPS selected the application for Verification. For details about the process, refer to the Verification page within this section or the SFA Handbook Application and Verification Guide Chapter 4 -Verification, Updates and Corrections.
When a school receives the student’s FAFSA information (including a valid EFC), student aid can be awarded, a process called ‘packaging’. The general rule in packaging is that the student’s total financial aid and other Estimated Financial Assistance (EFA) must not exceed the student’s financial need. The EFC is deducted from the cost of attendance (COA) in order to determine the student's financial need. The college/university determines the COA, which is an estimate of the expenses that are usually incurred by students attending that school. Typically, a COA will include tuition, fees, living expenses (room and board), books and supplies, and transportation. Each school has a different COA.
Packaging is a process that varies from school to school, depending on the types of scholarship and other aid available at the school, and the characteristics of the student population. Schools may have different packaging philosophies, but an attempt is generally made to find the best combination of aid to meet the financial need of the students attending that college.
The college will send a financial aid award notification to each student who submitted a FAFSA to them. The award notification outlines the financial aid package the college can offer. The student and their parents can accept or reject all or part of the offer.
The Department of Education publishes a variety of User Guides, Dear Colleague Letters, Federal Registers and other policy and procedural guidance each academic year that provide details about all phases of the financial aid process. The information is posted on the Institutional Financial Aid Professionals (IFAP) website.
- 2020-21 Summary of Changes for the Application Processing System Guide
- EDE Technical Reference (Final 2020-21)
- EFC Formula Guide
- ISIR Guide
- SAR Comment Codes and Text Guide
- SFA Handbook includes numerous chapters within each volume to assist with all phases of Student Financial Assistance
- FAFSA on the Web
- 2020-21 FAFSA on the Web Worksheet (English or Spanish)
- 2020-21 Paper FAFSA (English or Spanish)
- NSLDS Student Access website
In addition to information available on the IFAP website, there are other sources of information available to assist with the financial aid application process and determining eligibility.
- Finaid.org (Applicants can determine an estimated EFC on this website.)
- Mapping Your Future
- UICIS website (with a link to the DHS)
- Form G-639 FOIA Request
- Transition from paper G-845 for to Electronic Confirmation Process of Immigration Status
- DHS-SAVE Instructions for U.S. Department of Education (School) Users
- DHS-SAVE, Eligible Noncitizen