Here is what the outgoing Secretary of Education Margaret Spellings had to say about the financial aid process during a speech she gave on December 2, 2008 in Las Vegas at the Federal Student Aid Conference:
"Because families need your help! They need you to help them navigate a financial aid system that's been called "confusing, complex, inefficient, and duplicative," by my own Commission on the Future of Higher Education."
"Sadly, many students, up to 8 million in fact, don't
even apply for aid, in part because of all the red tape. We believe
most would have been eligible for assistance.
I know many of you share my frustration with the student lending process. Imagine the frustration for families going through it for the first time!
Let's walk through it with a fictional student, "Susie Smith." Susie is a high school senior. She's going to class, as usual. In addition, she's studying for her SAT and ACT, and maybe paying for costly prep courses. She is also working on college applications, which means filling out forms, writing essays, and chasing down references.... which in my house means lots of nagging from mom.
She turns in her college applications early, in the Fall of her senior year. Good. But now she has to wait until January to begin the student aid process.
That's when she can fill out the Free Application for Federal Student Aid, or FAFSA. It's 6 pages long, with more than 100 questions. It asks you how old you are three different ways.
Now, we've made some positive changes to the form for the 2009-10 year. But it's still a real "pain in the assets." Not long ago, Congress asked my department to recommend ways to simplify the process. In that same bill, they added 7 new questions to the form. That's Washington for you!
Once Susie submits her FAFSA, then what happens? My department tells her in a week or two whether she's eligible for federal student aid. Or, better yet, she receives her Student Aid Report in 3-5 days if she submitted it online through FAFSA on the Web. I'm proud of our work to make FAFSA on the web more user-friendly. You can file, sign, and even update it online.
Unfortunately, Susie won't learn how much federal aid her family may receive. It's up to the school to calculate that.
However, some schools will wait until the family files its tax return. More weeks lost.
Then there's the "verification" process. By law, schools have to verify 30 percent of applications. But they can choose to verify all of them. And some schools do. If Susie's form is flagged, her parents have to bring in their W-2 forms and tax returns, which help prevent fraud and abuse. But it doesn't make the process any easier.
Finally, Susie might have to fill out a "Profile" aid application form. It's required by many private, independent colleges. One more hurdle to clear.
But all this might not even matter. Why? Because Susie's school may wait until she is accepted for admission before determining her aid package. We're talking May 1st or later.
She may not receive her aid "package" until deep into the summer. And it leaves her without a backup plan. It denies her parents the leverage to negotiate a better deal. And it makes it harder to come up with another source of aid, like a home equity loan.
This is just the process for federal aid. There are also state aid, scholarships, and private loans. More time, more forms, more hassles. That is, if her family even knows about these sources of aid. But far too many do not.
You'd think we were trying to keep Susie out of college! And Susie and her family have to go through this process every single year. If she happens to transfer, she risks losing credits, money, and time.
In a good economy, this is inconvenient, at best. In a downturn, it's downright unacceptable.
Susie deserves better-and so do you."
So, there you have it, right from the Secretary's mouth; an admission of the challenging, complex, illogical, confusing, time-consuming process that you are about to embark upon.
Why do you do it? Simple; you deem the investment in both dollars and effort well worth the payoff in the value of education.