Interview questions for Financial Aid Director applicants . . .

Have to interview applicants who want to be your school's next Director of Financial Aid?  Here are some questions you can use to test their knowledge.


Q.1.  What's IFAP?
A.1.  It's ED's website, Information for Financial Aid Professionals,  This is where you find the Federal Student Aid Handbook, regulations, Dear Colleague Letters, etc.  If an applicant doesn't know that, the interview is over, even if the applicant is president of the state association of financial aid administrators (or, especially if he is).
Q.2.  If you needed to know whether an applicant earned enough money to have to file a federal tax return, to what publication would you turn?
A.2.  IRS Publication 17.  (I guess if they can't remember the number of the pub, but they know what it is, that would be ok.)  And you do need to know.  ED has cracked down on this, big time.  If you process an applicant who should have filed a tax return but didn't, you're looking at liability for every dime of federal student aid you give him.
Q.3.  What do you do if the applicant and spouse were married and living together during the base year, are still married, and both filed separate tax returns as heads of household?
A.3.  Require them to file amended tax returns and to provide copies to the school.  Neither one is eligible to file as head of household.  You cannot pay federal student aid when you know about something like this.
Q.4.  What's the advantage in certifying or originating Stafford Loans early for first-time borrowers who will be receiving Pell Grants, even though they have to be in class for 30 days before disbursement can occur?
A.4.  If the loans were certified (for FFEL) or originated (for Direct Loans) before the date of determination of withdrawal, you can count them as "funds that could have been disbursed" in the Return-of-Title IV funds calculation, which can increase very significantly the amount of Pell the school can keep if the student drops out before the loans can be disbursed.
Q.5.  If a student is selected for verification and he provides an IRS Letter 1722 signed by the IRS official, does the student have to sign the letter, too?
A.5.  Yes, unless the letter came directly from the IRS to the school -- and if that happened, you'd better staple the envelope to the letter so you can prove it.
Q.6.  What's the easiest way to calculate federal income tax paid for a divorced parent who filed a joint tax return with the ex?
A.6.  Figure out what percentage of the income was attributable to the parent who's on the FAFSA, and multiply that percentage by the joint taxes paid, to calculate the amount of tax attributable to the parent you're looking at.
Q.7.  Is a PLUS loan subject to the 30-day delayed disbursement for first-time borrowers?  What about verification?
A.  No, and No.
Q.8. Is it necessary for financial aid officers to look at admissions files for new students?
A.8.  If the admissions file contains any information that might conflict with what's on the FAFSA, the financial aid office had better look at it.  For example, if the application for admission asks the student about marital status, number of children, names and addresses of references or persons to contact in an emergency, the potential for conflict is there -- and actual conflict will be there quite often.
Q.9  What do you think about 100% verification?
A.9  Personally, I think it's a huge waste of time, and I wouldn't hire anybody who favors it.  But that's just me.  If the applicant hedges, because he doesn't know what answer you want, have him discuss the advantages and disadvantages.  See if he can think.
Q.10  Raoul has had a job and has been supporting himself since he was 18.  He's 22 now.  He answered "No" to all the dependency questions on the FAFSA (i.e., he's not married, has no dependents, isn't an orphan, and so forth).  Is this an appropriate case for a dependency status override?
A.10  Not without more.  Ironically, the mere fact that a student is, in reality, independent of his parents is not a factor in determining whether to perform a dependency status override. 
Q.11  Consuela worked as an admissions rep for your school in the base year and earned $35,000.  Now she has decided to quit her job and has enrolled in your paralegal program.  While she is in school, she will be working only part time, and expects to earn about $8,000 per year.  Can you do a professional judgment adjustment to reduce her income to $8,000?
A.11  YES!  Some financial aid people have this idea that a student must be unemployed or underemployed through no "fault" of their own (in other words, involuntarily) in order to qualify for a professional judgment adjustment of income.  WRONG!  The law says any reduction from base year income is grounds for a PJ.   
Q.12  Suppose you get the job, and after two weeks you suddenly suspect the school has been funding an ineligible program with Title IV funds, whether inadvertently or on purpose.  What do you do?
A.12  You dig up the regulations, copy them, and present the problem to your supervisor.  You do not call ED to ask them about it, and you don't blab about it to other staff members.  If your superiors at the school cannot convince you that you're wrong, you ask them to contact one of the education attorneys for a reading on the problem.  If they won't do that for you, then you'd probably better quit. 
More questions and answers will be added later -- be sure to come back.  Comments?