What Should You Do After You Lose Financial Aid?

Losing your financial aid doesn’t mean the end of your college days.

If you’re at risk of losing your financial aid, you’ve got a few options to consider. You can appeal the decision through your University’s financial aid board, try to regain eligibility by raising your GPA, or seek funds from outside sources. In some last-ditch attempts, you can even try changing majors.

So, what are some of the most common reasons students lose their financial aid? Let’s take a look. 

Why do students lose their financial aid?

These are the typical situations that cause students to lose their financial aid:

  • Not maintaining Satisfactory Academic Progress (SAP)
  • Not maintaining the required GPA
  • Not registering for the minimum required classes
  • Convictions for drug possession or sale
  • Not registering with the Selective Service System (men only)
  • Defaulting on federal student loans
  • Owing a refund on a federal grant

What is SAP?

Satisfactory Academic Progress (aka SAP) is the set of standards that ensure you’re holding up your end of the bargain as a financial aid recipient. In general, students need to maintain at least a 2.0 GPA or higher (depending on the University), to continue receiving financial aid. 

SAP also requires that students have a certain number of credits per semester to maintain their aid. Check with your financial aid office to better understand what the requirements are for your specific financial aid package. 

If you feel like you might be at risk of losing your financial aid, you might be wondering what that process looks like.

What happens if you lose your financial aid?

You’ll receive a warning

If your GPA drops too low or you didn’t register for enough classes to meet the requirements, an SAP warning may be issued. You can still receive financial aid if you were given a warning, so this gives you a chance to bring your grades up or register for more classes. If this doesn’t happen, your financial aid will be suspended.

What happens if you don’t fix the problems?

In most cases, you can continue attending school at your own expense until your grades recover. Once this happens, students can apply to resume financial aid. Depending on the source of the financial aid, it’s probably not gone forever if it is suspended. Just get things back on track, and you can likely receive financial assistance again.

What are your options once you lose financial aid?

File A SAP Appeal

If there’s a good reason your grades or attendance dropped, such as a death in the family or a serious illness, your University may have an appeals process.

If your aid appeal is successful, you may get your financial aid back. Not all colleges provide this option, however, and it’s their decision whether to accept or deny your aid appeal.

Wait Until The Next School Year

In the cases of issues like losing your eligibility or being convicted of a drug offense, students may be able to regain eligibility for the next academic year.

While that may mean putting your education off a semester or two, it’s better than taking out private loans to cover the remaining cost of the aid you’ve lost. 

Get Out of Default

In the case of defaulting on a federal student loan, you may become eligible again if you get yourself out of default.

This can be a rough process, and sometimes the federal repayment plans will be willing to work with you to get you out of it. If you need your financial aid to continue your education, make it a point to take care of your late payments. 

Lower Your Living Expenses

If you have family members or close friends near school, it may be time to say goodbye to that apartment or dorm room and live somewhere less expensive. If you have roommates, try to convince them to take on another one, so everyone pays less per month. A part-time job is another excellent way to bolster your finances.

Explore Financing Options

If you’re not able to get your free financial aid back, you may need to explore the option of private student loans. However, it’s become common knowledge that student loan debt is a rising crisis in this country. In fact, it’s eclipsed all other forms of debt in the United States (except mortgage debt). Put together all of the car loans in the country, or every penny of credit card debt, and student loans still add up to more. Federal aid, grants, and scholarships are more important than ever.

Last Ditch Efforts

If your financial aid is at risk because you’re not meeting the requirements of SAP, there are a few other options you can try. Depending on the specific requirements of your aid programs, some of these methods could work for you.

Keep in mind that these solutions are last-ditch efforts that are at least better than dropping out completely (assuming you’re unable to afford school on your own).

Changing Majors

Changing majors can be one way to retain your financial aid if your SAP begins to suffer. Sometimes, classes that don’t apply specifically to your major can have less-stringent effects on your SAP regarding financial aid. That doesn’t mean you’re OK to slack off on these classes, however. Poor grades in these classes still affect your overall GPA, which can put you at risk of losing your financial aid.

Switching Schools

Switching schools entirely is another possible way to keep your financial aid. It will also allow you to apply for additional aid through your new school. The academic record from your previous college will be examined when you apply to the new University, however, which may disqualify you for financial aid.

The economic strain of college is not something that should be taken lightly. Most people can’t afford a degree without some form of financial aid, and student loans can follow you around for life. By obtaining as much free financial aid as possible in the form of aid, grants, and scholarships, you can get the education you want while avoiding a hefty price tag.

Don’t forget to file your FAFSA® early every year to guarantee you get the most money from your financial aid award package.