Why we’re excited about the Better FAFSA
Several of the changes will make it easier for students and families to fill out the FAFSA:
More students will be eligible for the Pell Grants, money that doesn’t need to be paid back
Federal Student Aid, an office of the U.S. Department of Education, estimates 15% more students will qualify for federal Pell Grants under the Better FAFSA process. This significant increase in eligibility is due to formula changes and funding.
Notably, the Better FAFSA will no longer ask about felony convictions so incarcerated students would be eligible for a Pell Grant. Pell Grant lifetime eligibility will be extended to students whose schools closed while they were enrolled.
Connecting more students with more funds
Parents and students often wonder if it’s worth their time and effort to complete the FAFSA form. With the new changes to the FAFSA, the average Pell Grant in North Carolina is projected to be up to $5,041, and that’s free money they don’t have to pay back. Colleges also rely on the FAFSA for many financial aid decisions, so it can open the door to other scholarships and grants, as well as student loans. Sometimes these scholarships are a combination of merit and need based. In North Carolina, a new need-based scholarship will also be available to eligible students planning to attend one of North Carolina’s public community colleges and universities who fill out the FAFSA. For most students, the investment of time to complete a FAFSA is well worth it given the access to financial aid it provides.
Pro tip: Even if a family doesn’t think filling out the FAFSA will benefit them, we encourage them to do so as colleges often have their own aid available with criteria that may differ from what Pell grants require. It’s also important to remember that circumstances could change. It’s easier to amend an existing filing than start from scratch, especially if the family has just gone through a stressful life event like job loss or death of a family member.
Students will be able to better understand the cost of higher education
Colleges will now need to provide clearer information publicly to students about the cost of attendance. This will include supplies needed, transportation, living expenses and other expected costs. This gives students the ability to make a more informed decision about where to go to college.
The Pell Lookup Table should also help people understand their eligibility for federal aid.
Electronic process instead of mail in place for parents without a SSN
Parents without a Social Security Number will no longer have to deal with a cumbersome physical mail in process.
Parents and legal guardians without SSNs will be able to obtain an FSA ID starting this year, using an electronic process.
The new process, which will be unveiled in early fall, will allow contributors who do not have SSNs to obtain an FSA ID, and will be fully electronic. Contributors will have their identity verified through the TransUnion Credit Bureau, or, if they do not have documents in that system that can be used to verify their identity, they will be able upload their documents to the FSA website. The manual process is being retired.
Previously, people in this situation had to mail the signed signature page and have it matched with their child’s FAFSA manually, a slow and inefficient process that applicants sometimes had to repeat multiple times.
Easier process for achieving provisional independence
When a student faces difficult circumstances that prevent them from completing the FAFSA with a parent, they must apply for provisional independent status. Students who are concerned about safety contacting a parent or students who have been victims of human trafficking, those whose parents are incarcerated, and other students in difficult circumstances will be able to indicate on the form that they face unusual circumstances to be granted this status. See page 243 of the 2024-2025 FAFSA Form Preview presentation for step-by-step descriptions of how this will be implemented.
This change will put Pell Grants and other federal student aid in reach for many more students.
More streamlined FAFSA application process
The FAFSA will be more streamlined, pulling information over from the FSA ID and IRS. This reduces the amount of information the student and parent should have to enter and makes eligibility more predictable for students and their families. It also will likely reduce the verification process by using data-sharing with the IRS instead.
Items no longer required:
- Cash support and other money paid on behalf of the student, such as 529s owned by someone other than the parent or the student (ex: a grandparent is the owner and student is the beneficiary)
- Veterans’ education benefits
- Workman’s Compensation
- Selective Service question
- Drug Conviction question
- Payments to tax-deferred pensions not on the federal tax return
- Other untaxed income sources
- Child support paid out of the household
- Housing choices for each college listed