Report money from sale of parents' home on FAFSA?

Question

I know that a student doesn't report the value of the parents' home on the FAFSA but what if they just sold their home and thus have the proceeds in a bank account while they look for a new home. Reporting it makes the parents look like they have a lot of cash on hand, when they actually have to put it all into a new home very soon (they are renting in the meantime). On paper they look like rich renters....

Answer 1

If the money is in the parent's bank account when the FAFSA is filed, it must be listed.  However, you have the option to appeal to the Financial Aid Office and explain the cirucumstances after the fact.  The appeal usually requires documentation (perhaps proof you finally used the money to buy another house).  Check with the Financial Aid Office at the school your child is planning to attend for details.