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New federal policies raise uncertainty in financial aid, admissions

Experts are waiting to see how the Trump administration could impact financial aid and admissions in the long term.

A laptop screen displays the Common App webpage.

The Herald spoke to experts about their predictions for changes in higher education as Trump administration policies create uncertainty regarding college admissions and financial aid.

With new Trump administration policies impacting college admissions and financial aid, experts say the future of higher education remains uncertain.

The Department of Education announced that the Free Application for Federal Student Aid, or FAFSA, will return to only offering “male” and “female” as choices for the applicant’s sex. The category previously included “nonbinary” and “prefer not to answer” options.

A Friday X post from the newly formed Department of Government Efficiency’s official account read “Fixed,” alongside a screenshot highlighting the change.

That same day, the Department of Education gave institutions two weeks to “ensure that their policies and actions comply with existing civil rights law,” specifically as it relates to diversity, equity and inclusion initiatives. The directive threatens to cut the colleges’ and universities’ federal funding if they do not comply.

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The letter also states that “a school may not use students’ personal essays, writing samples, participation in extracurriculars, or other cues as a means of determining or predicting a student’s race and favoring or disfavoring such students.” 

The Department of Education also argued that the Supreme Court’s decision to ban race-based affirmative action also prohibits the use of race in “admissions, hiring, promotion, compensation, financial aid, scholarships, prizes, administrative support, discipline, housing, graduation ceremonies, and all other aspects of student, academic, and campus life.” Such actions could shake up aspects of college admissions and campus life.

Allie Arcese, a spokesperson for the National Association of Student Financial Aid Administrators, said the Department of Education typically corrects and makes additions to the FAFSA annually. But the changes for sex categories were implemented outside of the typical cycle.

Following Trump’s gutting of agencies and organizations like the U.S. Agency for International Development and the Consumer Financial Protection Bureau, the Department of Education may be the next target.

Jill Desjean, director of policy analysis at NASFAA, told the Herald that the details of a potential Department of Education shutdown are “a complete unknown.”

The Department of Education was “created by Congress,” so it “needs to be dissolved by Congress,” Desjean added, referencing the fact that a president cannot independently shut down an agency created by Congress.

Even if the education department was shut down, “someone would have to administer the FAFSA,” Desjean added.

The White House did not respond to a request for comment. 

In 2023, following the Supreme Court’s decision to end race-based affirmative action, the Biden administration issued a report to encourage diversity in higher education in accordance with the law. 

Richard Kahlenberg, an expert witness in the affirmative action case, wrote in an email to The Herald that he will be looking to see if the Trump administration “seeks to curtail race-neutral strategies,” like giving admissions advantages to economically disadvantaged students to increase racial diversity.

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The Trump administration is also considering cutting research grants for colleges and universities — but it’s unlikely that the changes will have any effect on financial aid, wrote Sara Harberson, the founder of college counseling company Application Nation and previous associate dean of admissions at Penn, in an email to the Herald.

“The word of the week is ‘uncertainty,’” Harberson added. “We are just not sure how all of this will shake out.”

But if any guidance or changes come within the next month, it could be troubling especially for schools with a high number of applications coming in, she said.

“To say that admissions staff are consumed … would be an understatement,” wrote Harberson, adding that changing course “would be extremely difficult for any college.”

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“No one is making a first move,” Harberson concluded. “We will have to wait and see.”

Correction: A previous version of this article misstated that Jill Desjean is a senior policy analyst at NASFAA. She is the director of policy analysis. The Herald regrets the error.


Teddy Fisher

Teddy Fisher is a senior staff writer who studies International and Public Affairs and is passionate about law, national security and sports. He enjoys playing basketball, running and reading in his free time.



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