Mishaps in new FAFSA form rollout leads to delays in processing applications

As the enrollment deadline draws near for universities, some students still don't know if they will get the financial aid they need to pay for school.

That's because of a set of major issues in the federal government's financial aid office.

It comes at a crucial time for students, as high inflation and a tighter economy are leading to more desperation for those who rely on federal assistance.

Back in December, the Federal Student Aid office, which administers the Free Application for Federal Student Aid (FAFSA), rolled out a new system. Changes included a simpler form that was supposed to streamline the federal financial aid application process for families. It also reduced the number of questions from over 100 to about 20, depending on the applicant.

However, problems have plagued the site since its launch on Dec. 30.

At first, many applicants reported trying unsuccessfully for hours and even days just to log on and start filling out a form. For those who succeeded in filing applications, an early miscalculation left out inflation adjustments for everyone who had applied.

Then two weeks ago, the federal agency announced that its system also didn’t include all data fields to correctly calculate aid based on the assets students reported, requiring their applications to be reprocessed and resent to schools.

“At this stage in the game and after so many delays, every error adds up and will be felt acutely by every student who is counting on need-based financial aid to make their postsecondary dreams a reality,” Justin Draeger, the president and CEO of the National Association of Student Financial Aid Administrators, said in a statement Friday.

Karen Krause, executive director of Financial Aid, Scholarships, and Veterans Benefits for UT Arlington said the last few months have been frustrating for her team and for students. While many families reported it was easier to fill out with the updated form, the glitches that have slowed down processing applications have put a shadow on the new system.

"I think the goal ultimately will be there once the kinks all get worked out. So that's the light at the end of the tunnel, I suppose. It's just, it's been a long tunnel,” she said. “I guess that would be a way to put it because students and families that have had issues, that's been, I think, the biggest frustration – is not clear guidance or delays in being able to resolve those issues."

The Department of Education said that the miscalculations have been resolved.  It said roughly 200,000 applications were affected out of the more than 1.5 million it has already processed. But this year, there are close to 7 million FAFSAs submitted so far.

That’s why the entire system is behind schedule as authorities race to clean up technical glitches with the online form, process applications and push financial aid packages out the door.

FAFSAs are usually processed within hours or days, but the issues have caused millions to wait months to learn how much money they will get to pay for the upcoming school year.

With commitment deadlines for schools coming up in the next few weeks, many campuses across North Texas have pushed back their own FAFSA application deadlines and other due dates by up to three weeks or more.

“Just to try to accommodate this idea that if students can't even make corrections on their documents until the first week or two of April, we need to give them time to be able to do that,” said Krause. "The state priority deadline for need-based programs through the Texas Higher Education Coordinating Board is April 15th. They have not said whether they're going to move that date or not. But most of us have moved our priority deadlines."

Universities also use the FAFSA data to award their own grants and scholarships. Experts say students need to check in with their university or college to see if deadlines have been adjusted, as schools are still making those decisions right now.

"Most colleges and schools are going to be much more flexible with deadlines than they have been. Typically, May 1st is a deadline to accept your admission nationally. But again, even that deadline, I think some schools are moving to June 1,” said Krause. “So each school has some flexibility as to what they want to do, but I think students just need to pay attention and be in contact with their particular school or schools that they're looking at to see what those deadlines are."

Krause said that the changes happening to the federal financial aid program are the biggest she's seen in 30 years. However, she added that the Department of Education did not receive additional government funding to implement it.

While the government works through the delays, many schools are finally getting student information back and are getting around to sending out award letters, which Krause said should be picking up the pace over the next few weeks.

For more information about FAFSA and to fill out the form, click here.