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Significance of Date of Divorce

Will246Will246 Posts: 7Registered User New Member
I have a student who is a senior in high school and whose parents' divorce will be final in January, a month before he files FAFSA. Can you tell me what the significance of the FAFSA question is that asks the date the divorce was final? Dad makes good money, but children will be with mom full time starting in January, so I am wondering if FAFSA (and/or the college) will use only mom's assets and income for the EFC. This is a bit of a tricky situation so:

1. Whose income/assets is used for 2012 if divorce is final in 2013 before FAFSA is filed?
2. If the family has to use all of their income, including dad's for 2012 since they were married throughout that year, should they skip filing the FAFSA for the 2013-2014 school year so a precedent is not set of a higher income?
3. I keep seeing information about needing to file a divorce decree but where do you get this form? From the college or from the FAFSA?
Post edited by Will246 on

Replies to: Significance of Date of Divorce

  • cptofthehousecptofthehouse Posts: 25,348Registered User Senior Member
    Look at this: FinAid | Professional Judgment | Divorce and Separation.

    In certain states the decree can be essential. But in most states, the date of separate residences is what determines the date of separation and the date of divorce is not an issue.

    I also do't understand how a student can file FAFSA a month before January. If the divorce decree is truly going to be final in January and teh student is in a state that does not recognize legal separation, the FAFSA should be filed on or after the date of the decree. Just like you don't file FAFSA on a day when the accounts are flush with money, but on a day after all bills have been paid, you don't file on a date before a significant event unless you absolutely have to. GIven that the earliest dayt you can file FAFSA is January first, and it is unlikely that W-2s and other papers are even going to be available until later in the month or the end of February, in this case it behooves the student to wait for that date (all a moot point if he is in a state that recoginzes legal separation which is most of them) It's the status of the family as of the date the FAFSA is filed that determines status on that FAFSA, just as it is the amount of assets on that date.

    1.Income/Assets of the custodial parent only is used for 2012. Sometimes a split has to be made when much of the assets/income are conjoined for the given year. Best estimates are used. If the family was living together for 2012, the amount is often just split in half.

    2. There is no precedent set for future years. FAFSA has to be filed each year. Without the FAFSA being filed, the student nor either parent can apply for federal loans even if the family income/assets do turn out to be too high for any actual aid.

    3. From the college and it can be determined by the state. If you read the cite I gave, it explains that in some states, legal separation is not recognized, and in such cases, there has to be a divorce decree. In most states, just physical separation is needed. In the case where the parents are living together, the divorce decree is needed since there is no physical separation, legal separation just intents and intents don't count.
  • dodgersmomdodgersmom Posts: 5,960Registered User Senior Member
    parents' divorce will be final in January, a month before he files FAFSA.

    Looks like the student will, indeed, be filing FAFSA after the divorce is final.
  • Will246Will246 Posts: 7Registered User New Member
    Thanks for the lengthy follow up. That is correct, FAFSA will not be filed until February, after the divorce is final. Parents currently live together and will be splitting up after the divorce, so I will be sure to get the decree.

    That is good to know the schools will split the income from 2012 (and assets on date of FAFSA filing) accordingly. That was my main concern - if we file, could the school pull some type of shenanigan and make a professional judgement to limit the award due to the father's income. Dad currently makes about $225k while mom made $6,000 last year and will make about $50-60k in 2013 from child support and spousal support (alimony). Obviously it will be better to file under mom (and ethically correct since kids will be with mom), but I was concerned the schools may make adjustments since 1)dad makes a good living and 2)the kids lived with both parents in 2012 even though they will be with mom greater than 50% of the time in 2013.

    So to sum up, you think it will be ok to file under mom and they should get their award based on mom's salary in 2012 as well as mom's salary moving forward in additional years. I guess my concern is I understand the rules now, but do the schools always follow them?

    Thanks for the in depth replies. This website is a tremendous resource.
  • cptofthehousecptofthehouse Posts: 25,348Registered User Senior Member
    Any school can do what it pleases in terms of how it wants to view the financials when it come to its own money. There is no "fair" involved here. They decide which student they want and if they want to pay for them to come.

    For the FAFSA determination, the rules are set out, but in cases when things are not clear cut, the financial aid directors do make the professional judgement. Kelsmom who has worked FA offices can probably tell you how she has seen income splits for the prior year in situations like this. I have no idea. My feeling would be that since the parties were living together all year, the split should be along 50/50 lines, but that is just my take on it and has no bearing on what the decision will be.

    For future years the salary will be mom's if that who the student is spending the most time with, and any child support would also be reported. There are certain rules that are straightforward but when one gets inot situations that are not frequently seen with truly unique twists, a professional judgement has to be made.
  • Will246Will246 Posts: 7Registered User New Member
    Thank you. That is kind of where I was headed. Does anyone have any experience with how offers are adjusted when the situation changes dramatically from one year to the next? For example, if they split the assets from last year 50/50 then the student won't get any needs based aid since he is looking at public schools. However, if EFC drops from $45,000 year 1 to $10,000 in year 2 due to only counting mom's income in year 2, will most/some/few schools adjust accordingly if there is a "precedent" set with a really high EFC from the first year? Are there any general trends on how this is handled between public vs. private colleges?

    This is where I'm trying to decide if we should just skip filing the FAFSA the first year, and start with what would be certain low EFC numbers in all following years.
  • cptofthehousecptofthehouse Posts: 25,348Registered User Senior Member
    Will, first of all unless a school guarantees to meet 100% of need and uses only FAFSA to define it, the FAFSA EFC is pretty much useless in terms of guessing what a student is going to get from the school. I don't know a single school that guarantees to meet need using only the FAFSA. All the EFC guarantees is eligibility for financial aid. PELL is based directly on the EFC, but you gotta have a very low number to get that money and the max is about $5k. All freshmen can borrow $5500 regardless of EFC if the school Cost of Attendance justifies it, and the only thing that the need component does is give those kids who have need a deferral of interest and lower interest rate. It's still Direct Loan monies. Some state programs use the FAFSA and have their income guidelines as well.

    But when it comes to a school's own money, look at the average % of need met for that school. If it's 50%, then that means if you kid is an average kid in that group, maybe half or less of his need is going to be met. Usually the money goes first to the most highly desired (high test scores usually) kids. You can get zero in financial aid from the school regardless of what your need is.

    And, no, the schools do not care what your EFC was the prior year. Skipping FAFSA the fist year makes no sense and for some schools if you don't apply that first year, there are sit out requirements.

    Those schools that tend to meet full need usually want PROFILE or additional info, and they often want BOTH parents financials. There are some exceptions, but that is the usual way it goes.

    But, no, there is no precedent that is set, and actually those kids on financial aid the year before, usually get preference over those who are newly asking for aid in consideration.

    Most public school use FAFSA only and hardly any of them guarantee to meet full need and do not meet full need for the vast majority of their students. Especially in terms of grants. Also OOS publics do not tend to be generous to any but top candidates since their state kids usually get first go on the money. The most selective private school tend to be the ones that do guarantee to meet full need but they define that need and will look at things that FAFSA does not take into consideration such as primary home equity value, and most importantly, in your case, none custodial parent income. And there are schools that out and out say, if you don't apply for aid the first year, you are at the end of the line or have to sit out a year to be eligbile. Those tend to be schools that meet need generously but are need aware in admissions and they don't want people playing games trying to get an edge up in admissions by not asking for aid the first year, and then popping the aid app later.

    But for public schools, most of them anywaysj--it can depend on the school--there are exceptions, they won't care if you sit out a year or not. But be aware that they are not likely to meet full need either. Your student will need to file the FAFSA anyways to be eligible for loans, both student and parent, and for work study if eligible. But, no, they are highly unlikely to make the first year's number a precedent. These days with job losses, divorce,and so many other issues, this happens a lot. File the danged thing but look at the school's numbers in meeting need as it may not be one that is likely to meet need anyways.
  • Will246Will246 Posts: 7Registered User New Member
    Tremendous info. Thank you for taking the time to provide such a thorough answer. This helps me out a lot.
  • cptofthehousecptofthehouse Posts: 25,348Registered User Senior Member
    I would ask to talk to a Financial aid officer of the school you have in mind and ask some quesitons. One thing I did not mention is that most schools tend to give their best financial aid packages to the freshmen because they are trying to put together the best class they can. In some situations, it is wise to take a gap year, the aid to returning students is not good in the case of changed financial circumstances. It won't do you any good to simply not apply for aid the first year, because the issue at hand is that most of the money in the financial aid budget goes to freshmen and they are taken care of first. In every school I know, the returning students have later dates for their aid packages, and though schools do try to keep the packages about the same, most of them do give less in subsequent years as there is a prevailing philosophy that the students should be taking on more of the cost each year of college. In a situation as you outline, it would be wise that the fin aid office, and an officer there be aware of the situation from the onset if they will take that into consideration. It won't hurt your admissions chances at schools where admissions is need blind which is the case at most all state school to discuss these things.
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