Five Things You Need to Know About Divorce and Applying for College Financial Aid
If you are separated or divorced and have children preparing to go or already in college it is important for you to understand how divorce may affect your child’s college financial aid. Lynn O’Shaughnessy wrote an article for CBS Money Watch, listing five things you need to know about divorce and financial aid.
Where the child primarily resides matters:
The parent with whom the child resides primarily should be the one to fill out the Free Application for Federal Student Aid (FAFSA), which is required when requesting college loans. The non-custodial parent’s income is irrelevant for financial aid purposes. If the child lives with both parents an equal amount of time, then the parent that has spent the most money on the child’s care would be the one to fill out the FAFSA.
Residency is determined based upon the date the FAFSA application is submitted:
If the FAFSA application is submitted on March 1, 2014 then you must look at the 12-month period between March 1, 2013 and March 1, 2014 to determine where the child primarily resided.
It does not matter who claims the child as a tax exemption or who pays child support:
The only time child support might become a factor is if the child spends equal time with both parents and the amount of child support paid is more than the other parent spends on the child’s care.
Remarriage can affect financial aid eligibility:
If the custodial parent remarries, the new spouse’s income and assets must be listed on the FAFSA. This could potential jeopardize a child’s eligibility for financial aid.
There are different rules for the CSS/Financial Aid PROFILE:
The PROFILE aid form treats divorce differently than the FAFSA. There are approximately 250 private schools that use the PROFILE aid form and typically they want financial information from both parents. How the information is utilized varies from school to school.