The Consolidated Appropriations Act of 2021 included The FAFSA Simplification Act.
The COVID-19 relief legislation aims to simplify the Free Application for Federal Student Aid (FAFSA). The new form has been reduced from 108 questions to about three dozen questions, and the changes will be in effect starting July 2023 for the 2023-2024 academic year.
This legislation will replace the Expected Family Contribution (EFC) with the Student Aid Index. The EFC is confusing many families as they often think that this is all they have to pay for college. Usually, families spend more than the EFC since most colleges do not meet the family’s total financial need.
Custodial Parent status remains the same, and the parent who provides the more significant financial support is considered the Custodial Parent.
The criteria for the Cost of Attendance have changed.
- The allowance for room and board will be separated, making the cost more transparent.
- The allowance for personal expenses will require at least half-time enrollment.
- The meal plans must be based on three meals a day.
- The allowance for loan fees for private student loans has been removed.
- Colleges no longer will set the housing allowance to zero for a dependent student living at home.
- The allowance for loan fees on federal student and parent loans will be mandatory and no longer at the college’s discretion. It will be based on the loan fees’ actual cost and not the average price or allowance.
- There are two new housing allowances, which bring the total to six.
- The new legislation requires colleges to disclose all costs of attendance on their website.
To learn more about how these significant changes affect you and how to take the mystery out of the complex financial aid system, give us a call at 888-305-1441 or contact debbie@savvycolllegfunding.com or visit our website at www. savvycollegefunding.com