By NASFAA Policy & Federal Relations Staff
Yesterday the Department of Education (ED) released guidance on what institutions should "avoid" when issuing financial aid offers. The guidance, which was unexpected, comes at the same time ED is requesting feedback on its new College Financing Plan (CFP) and just a week after a group of senators released a bill regarding award notifications, the Understanding the True Cost of College Act. ED is encouraging schools to avoid the following:
Avoid calling your financial aid offer an "award" and avoid calling it a "letter."
Avoid issuing a financial aid offer that does not include Cost of Attendance.
Avoid listing the Cost of Attendance without breaking it down into clear components.
Avoid listing grant and/or scholarship aid, loans, and work-study together.
Avoid listing student loans without clarifying the source (federal, state, institutional, or private).
Avoid listing Parent PLUS loans with student loans.
Avoid issuing a financial aid offer without critical next steps.
Avoid issuing a financial aid offer without net cost calculated.
It is unclear how the new guidance will interact with the draft CFP, as some of the items in the guidance conflict with the draft CFP, including the treatment of PLUS loans and the requirement that next steps be listed. NASFAA will be submitting feedback to ED on the draft CFP later this month, and continues to advocate at the congressional level for required standardized terms and elements, rather than full standardization.
Publication Date: 4/16/2019