It is a daunting task to analyze, interpret, and implement federal financial aid regulations these days. Hopefully the information I provide will help you understand and locate the financial aid you need to earn your online degree.
Legislation has passed through the House of Representatives, H.R. 5715, that is similar to Sen. Edward Kennedy's proposal which I reported in a previous post. Of those voting on 4/17/08, 383 voted yea, and 27 voted nay to the following package:
- Increases Unsubsidized Stafford Loan (Direct Lending not addressed) loan eligibility for undergraduate and graduate students by $2,000 annually.
- Increases aggregate limits (the amount you can borrow over the time you're in school) to $31,000 for dependent undergraduates and $57,500 for independent undergraduates. These amounts are currently $23,000 and $46,000 respectively.
- Parents who borrow a federal PLUS loan will have the option to defer loan principal repayments for up to six months after the student graduates or ceases to be enrolled at least half-time. Note that only the principal can be deferred. Interest will still accrue while the student is in school.
- For the period of July 2008 through June 2009, parents who are experiencing mortgage delinquency of up to 180 days, and may be affecting credit history as a result, will be able to request a special review of eligibility for the parent PLUS loan despite their bad credit rating. Keep in mind it's only for loan processed during this time period.
- Lender-of-last resort will now include parent borrowers. The lender-of-last resort program is for Stafford Loan schools (not Direct Lending). These lenders will be given subsidy from Congress to process loans for students/parents who may not otherwise qualify.
There were a few other items that included behind-the-scenes type issues: the Secretary, in consultation with the Secretary of Treasury, can purchase student loans from a lender under certain circumstances; and federal financial institutions (ex. Federal Financing Bank, Federal Reserve) are highly encouraged to use authorities in a timely manner so students and families do not experience delays in access to federal student loans for 2008-09. Both of these are rather vague, so I hope more information will be available soon.
Of course, a couple of other pieces of legislation are still floating around, with one being on the Senate side. I haven't had a chance to review that proposal yet, but hope to do so in time for my next post.
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About ter
I have been a financial aid advisor for nearly 25 years now! Time really does fly. Like other e-learners, I acquired my Bachelor of Arts degree and my Master of Science degree while working full time and raising a family. My coursework consisted of classroom instruction, online and independent study courses, and weekend classes.
I began in financial aid as a secretary, and have worked my way to senior level financial aid advisor at a public four year college in the Midwest. When I began in 1984, we did not have computers, so I have seen the evolution of technology and its impact on education and financial aid.
My husband and I have four children in our household. My daughter and stepson are both in college. My son and stepdaughter are high school freshman.
I look forward to being a part of eLearners.com and given the chance to educate students, especially “non-traditional” students, on the ins-and-outs of financial aid. It is a daunting task to analyze, interpret, and implement federal financial aid regulations these days. Hopefully the information I provide will help.