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How does job loss affect federal student financial aid?

Mark Kantrowitz

August 25, 2009

I am 22 and I work full time but don’t make enough to cover college tuition. I really want to finish my degree and am trying to figure out how to pay for it. My parents won’t help pay for it but I have to include their income on my FAFSA because of my age. I’d like to find a way to get my degree without putting myself in tons of debt if it’s possible. — Amanda K.

Students who are age 24 or older as of December 31 of the academic year are considered automatically independent for federal student aid purposes. A student who was granted emancipated minor status or was in a court-ordered legal guardianship prior to reaching the age of majority is considered independent. Unaccompanied youth who are homeless or at risk of homelessness and self-supporting and certified as such by a local educational agency homeless liaison, the director of a program funded under the Runaway and Homeless Youth Act, the director of an emergency shelter funded by the McKinney-Vento Homeless Assistance Act or by a college financial aid administrator are also considered independent.

There are a variety of other criteria for independent student status, such as being married, having dependents other than a spouse, being an orphan, being a graduate or professional student, serving on active duty in the US Armed Forces for other than training purposes, being a veteran of the US Armed Forces, or having been in foster care or a ward of the court on or after reaching age 13.

A student who does not qualify under any of these criteria is considered dependent and their parent information must be included on the Free Application for Federal Student Aid (FAFSA). It does not matter if the student is self-supporting and not claimed on their parents’ income tax returns or if the parents are unwilling to provide information on the FAFSA or for verification or if the parents refuse to contribute to the student’s college education.

College financial aid administrators have the ability to grant a dependency override in unusual circumstances, such as an abusive family environment or abandonment by parents. For example, a financial aid administrator might grant a dependency override to a student of divorced parents after the death of the custodial parent if the student has not had any meaningful contact or financial support from non-custodial parent in over a year.

If a dependent student’s parents have ended all financial support of the student and refuse to file the FAFSA, the financial aid administrator may allow the student to receive an unsubsidized Stafford loan even without the parents’ cooperation. This may not be enough, but it should help.

If you are independent, as much as half of your income above an “income protection allowance” will count against your eligibility for need-based student aid. If you will be quitting your job or reducing your work hours in order to go to college, ask for a professional judgment review. The college financial aid administrator can make an adjustment even if the job loss or reduction in work hours is voluntary.

Talk to your college’s financial aid administrator and explain your situation. They will do their best to try to find a way to help you.


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