Debunking FAFSA Confusion for Divorced Families

Kids preparing to go off to college often don’t think about financial aid forms or the litany of personal questions that come along with asking the federal government for a loan – or how to answer them. They think about their career possibilities and how to get there after graduation, where their friends will be going to school, what it’ll be like living in a dorm room, and whether they’ll get along with their roommate.

If you are divorced or separated with a teenager entering his or her junior year of high school, chances are you have started having serious discussions about paying for college with your child’s other parent. Unless you have already designated funds to pay for your child’s education, he or she may need some amount of financial aid. In fact, as of 2016, 72 percent of all undergrad students received financial aid. To apply, a form called the Federal Application For Student Aid (FAFSA) must be completed.

Who’s responsible for applying for my child’s financial aid?

The good news is that only one of you has to complete the application. The parent with whom your child has mostly resided for the 12 months prior to applying is the “custodial parent” for FAFSA purposes only, and is the parent who needs to fill out the application using his or her information. Take note that this has no bearing on who maintains legal custody. If your child split time equally between you during the year, then the responsible party is determined by the parent who provided more financial support.

The bad news is that as the parent who must fill it out, you can be thrown unexpected curve balls that you’ll need to deal with if you want to apply for funds. Remarrying can be one hurdle. Your new spouse will be required to apply with you and provide his or her financial information. (That’s a subject we recommend you discuss with your new spouse before the forms must be filled out and returned.)

If you have not yet remarried, but you are planning to and your soon-to-be spouse isn’t comfortable with being on the financial hook for student loans, you may consider waiting until after the forms are filed to get married. Remember, though, you’ll have to reapply every year.

Planning on separating, but still living together

If you are still physically living together, in the eyes of the federal government you are married when it comes to that little box to check on the FAFSA form. The same applies for parents who are divorced but have chosen for one reason or another to remain under the same roof. Even if your home is large enough to accommodate you both comfortably leading separate lives, you will both still need to apply and be legally responsible for any student financial aid loans.

Special circumstances

If you are literally stuck in a financial situation that is out of your control, then you might be able to contact the financial aid officer to explain your situation and be granted an exception. These officers do have some flexibility in making decisions, so be factual and persuasive in your explanation.

If you and your soon to be ex-spouse are living in that big house together because you both need the equity from selling it to buy a new home, that might be understandable. If your new spouse has bad credit because his or her former spouse ruined it in a nasty divorce, again, that might be a reasonable enough explanation for the loan officer to offer an alternate solution.

To answer the FAFSA question about household size, you must include the student, the parent(s) living in the home, the total number of children (whether or not they live at home) who receive over half of their financial support from the applicant parent(s) during the FAFSA period, and the total number of children living in the home who belong to your new spouse or partner who provides over half of their financial support for the specified period.

FAFSA requires an annual reapplication to qualify for student aid, so if your child began college prior to your divorce and you used a joint tax return and the “married” designation to complete the form, you should use as much of the FAFSA “custodial parent” financial information as possible going forward.

For same-sex couples going through divorce, you are subject to all of these same rules and requirements if you are considered legally married at the time the your child’s FAFSA is completed.

If you are considering ending your marriage, you need to plan ahead to eliminate as much confusion and conflict as possible to lessen the stress of applying for college financial aid. The understanding and savvy Columbia divorce and custody attorneys at McCabe Russell, P.A. will guide you through the decision process to best plan for future events after your divorce. To speak with a member of our experienced legal team call 443-812-1435, or we invite you to reach out to us through our contact form.