How drug convictions affect student loans
Are you ready to move forward with your education? Hoping to go back University to prepare for a successful next step – yet a drug or criminal conviction is a stumbling block in funding this education?
A federal or state conviction for possession of illegal drugs, conspiracy to sell or sell them may prevent you from receiving federal student aid, including scholarships and new student loans. But that does not mean that federal funding for education is completely excluded. Pell Grants, Federal Additional Educational Opportunity Grants, federal work-study and federal student loans can be obtained if you know what to do and where to turn for information to see if you qualify.
Here are some key things to keep in mind as you move forward in obtaining funding for college.
When you apply for a federal student loan, you will need to complete the Free Application for Federal Student Assistance, or FAFSA, which asks if you have had any drug-related convictions while receiving federal student aid. If you answer “yes”, you are prompted to complete a worksheet that will help you determine if your conviction affects your eligibility for new federal student assistance.
Note that if you are convicted of a drug-related crime after submitting to the FAFSA, you may lose your eligibility for assistance and may need to return any funds you received during the time you were found to be ineligible. .
If the time has passed, a drug conviction may not be a problem at all. Convictions only count for financial aid if the crime was committed while you, as a student, were receiving federal student aid. If you are on probation or parole, or if you live in a halfway house, you may be eligible for federal student assistance.
Find out about federal student aid eligibility criteria to fully understand your options if you have a drug conviction, and consider taking the following steps.
Make a change to regain eligibility for assistance
In some cases, students whose eligibility for federal financial aid has been suspended may exit this status sooner by passing two unannounced drug tests administered by an approved drug treatment program, or by completing such a program.
Contact your school’s financial aid office immediately if you regain your eligibility for aid during the award year so that you can obtain any aid you may be entitled to.
Understand how long the ineligibility for assistance can last
Under the current rules, if you are convicted of drug possession, you have one year of ineligibility for federal student assistance from the date of conviction. A second conviction results in two years of ineligibility. A third violation suspends your eligibility for an indefinite period.
A conviction for selling drugs means two years of ineligibility for the first offense and an indefinite suspension for the second and subsequent convictions.
Seek to reverse the conviction
Students whose eligibility is refused for an indefinite period can recover it if a criminal conviction is overturned, quashed or removed from their file.
But remember that everyone’s situation is different. Check with relevant legal resources to understand your specific situation.
Look for other financing options
If you have been incarcerated for illegal drugs or certain other offenses, your eligibility for student assistance may be more restricted. While not eligible for federal student loans, students serving a criminal sentence may benefit from certain federal grants as well as a federal work-study program. It is worth considering these options.
Even if you are not eligible for federal aid, you still need to complete the FAFSA, as most colleges and states use the information on the form to award non-federal aid. You may be able to get some of these non-federal funds.
Most importantly, you need to know your financial aid options and your eligibility as a drug convicted person. A conviction status can complicate your aid options, but it doesn’t have to dictate or define your future. If you’ve been convicted of a drug or other crime in the past, but are looking to plan for a better future, a financial or educational counselor may be your best first step.
There are resources available to people in a variety of circumstances – including options for those currently in prison, and for their children, to help finance their studies.
A good place to start exploring your options is a free consultation with an organization certified by the National Foundation for Credit Counseling. A conversation with a counselor from an independent nonprofit resource is a good way to start assessing your situation and creating an action plan for moving forward.
Julie Rogier is responsible for content marketing for GreenPath Financial Wellbeing, a national non-profit organization that provides financial advice and education to help people lead financially healthy lives. Rogier manages initiatives such as content marketing programs that support GreenPath’s more than 500 credit unions, banks and employer partners. GreenPath has helped millions of people student loan advice, debt and credit management, homeownership education and foreclosure prevention. Rogier holds a bachelor’s degree in communication and English from University of Michigan and an MBA in marketing, with honors, from Oakland University.