Most college students and their parents are familiar with the Free Application for Federal Student Aid (FAFSA). Students who need help paying for college must submit the FAFSA annually, including would-be students who are choosing among several institutions for their freshman year. According to a recent report by Inside Higher Ed, prospective college students may have cause for alarm about how their FAFSA information is perceived by institutions. Some believe that institutions are using the FAFSA to unfairly deny admission and reduce financial aid.
The section of the FAFSA at issue asks prospective college students to list the institutions they are thinking about attending (the online form contains enough space to list 10). The U.S. Department of Education then shares this information with all of the institutions on the list and with the state agencies that award financial aid. Policy researchers at the National Association for College Admission Counseling (NACAC) allege that admissions offices, private enrollment management consultants, and financial aid offices use this list to gauge student interest in their institutions.
NACAC suspects that admissions offices believe that students unwittingly list institutions in the order of their preference. NACAC reasons that institutions likely will deny a student an admission offer if they are low on the student’s list. This helps institutions to improve their “yield” (i.e., the percentage of admitted student applicants who decide to attend).
Additionally, institutions have been accused of offering smaller financial aid packages to students who list their school high on the FAFSA. This accusation is based on the idea that students are more likely to pay whatever it takes to attend the college of their choice.
The U.S. Department of Education has pledged to review the practice of sharing FAFSA positions with every institution that a student lists.
