Financial Aid Answers - presented by eLearners.com : 08-09

Back to Basics

ter — Thu, 13 Mar 2008 19:38:00 GMT

In my last blog, I mentioned how many students had not yet filed the FAFSA for 2008-09. So, I thought I'd go back to the beginning.

The Free Application for Federal Student Aid--FAFSA-- is the application to file for consideration of federal, and possibly state, financial aid. What's covered under the FAFSA is federal Pell Grant, federal Supplemental Opportunity Grant (SEOG), Federal Work Study, federal Perkins Loan, and student loan--either Direct Loan or Stafford Loan. Some states, such as mine, also have a state grant that is directly tied to the FAFSA. If you are interested in student loans, be sure to indicate so on the FAFSA.

Many students/parents at our outreach session were worried that it is too late to file the FAFSA since many schools publish a priority deadline. I heard everything from March 1, 2008, to last August, 2007! Rest assured, the earliest you could file the FAFSA for 2008-09 was January 1, 2008, so any date prior to that was just rumor. The priority deadlines established by schools are usually not absolute deadlines. The reason for these deadlines is because funding for federal Perkins Loan, federal SEOG, and Federal Work Study are VERY limited by our government, so funds go quickly and early. The Pell Grant and student loan deadlines are tied to your school's academic year end date, so even if the other funding is gone, you should still be considered for Pell Grant and student loans if you have not yet filed the FAFSA. It's not too late!

The FAFSA will ask you a series of questions to determine if you are considered an independent or dependent student for filing. How you or your parents claim you on a tax return does not impact your responses and whether you are independent or dependent. As a result, my response to this question, when asked, is to consult your tax advisor and file using exemptions that benefit your family the most. At the end of this series, you will be instructed on whether to file using parent information.

When completing the FAFSA, I highly recommend you print the Pre-Application Worksheet under Step 1 and complete it before filing online. This way, if you have questions you can consult your financial aid office before getting stuck online.

Once you file the electonic FAFSA, you will receive a confirmation with the Expected Family Contribution. The FAFSA information will be sent to the Federal Processor who will in turn send the information electronically to the school(s) you have selected. The school will then review your FAFSA information and complete your financial aid package based on the Expected Family Contribution. An award notification is then sent to you. Keep in mind that the school does not arbitrarily decide who gets money. It's based on the FAFSA information and schools must use federal and state guidelines to determine your package.

The website to file the FAFSA is www.fafsa.ed.gov.

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Search for Those Scholarships Now

ter — Tue, 29 Jan 2008 23:59:00 GMT

I've mentioned before that a large amount of scholarships exist "out there", and now is the time to be searching and applying. Many scholarship applications have deadlines between February and April. Besides the FAFSA, where do you look?

The first place I would suggest is your school. Many colleges have private scholarships, which are funded by monies endowed to that specific college. These scholarships could be related to a certain major, a certain localized geographic area, or more generalized for a certain grade point average. Some may require essays or reference letters, so don't delay in gathering the information.

Another ideal resource is your own hometown or area. The American Legion, Sheriff's Association, B.P.O. Elks Lodge, and Cooperative Extension Office are a few that offer scholarships for students in their immediate area. These scholarships can be highly competetive, so be sure to fully complete your application and don't be afraid to promote yourself, but tell the truth. Check out your town's Chamber of Commerce or City Hall to see if a list of scholarships is available.

There are a number of websites, such as fastweb.com, that offer free scholarship searches. I know of scholarships.com, fastaid.com, petersons.com/finaid, and scholarship experts, as other valid free scholarship searches. Your local library is another resource, but be careful to check publication dates to make sure the information is current.

Lastly, do a scholarship search on the Internet. However, I can't stress enough to be careful of scholarship scams. Scholarship applications that have a fee may be a scam. If you're not sure about the validity of a scholarship, contact the sponsor or the possibly the Better Business Bureau. The Federal Trade Commission has a website designed to help you identify scholarship scams at http://www.ftc.gov/bcp/conline/edcams/scholarship/index.shtml

One thing I want to note, especially with private college scholarships, is that the person making the endowment can make certain specifications for applicants, such as national heritage. This is not usually the case for scholarships offered by companies and businesses. I researched discrimination and scholarship applications on the Internet, but was not successful in locating any specific policies. What I found were federal laws for employment and college admissions, but not scholarships. I think I'm safe in saying that as a rule of thumb, most scholarship applications will follow along the lines of affirmative action policies for employment.

I Googled scholarships for Italians and came up with several links to scholarship applications for students of Italian heritage. Not to single out one group, I also Googled scholarships for students of German heritage and found some, too. And the United Negro College Fund offers scholarships to students who attend a UNCF-affiliated college.

I can't stress this enough----start searching for scholarships now! And look (or search) outside the box!

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Pell Grant Increases!

ter — Sun, 27 Jan 2008 22:58:00 GMT

As a result of the College Cost Reduction and Access Grant, the federal Pell Grant for 2008-09 is increasing from a maximum $4310 to $4731. The Expected Family Contribution (EFC) cut-off is 4041, which means if the EFC listed on your Student Aid Report is 4041 or less, you qualify for the Pell Grant.

The Student Aid Report (SAR) usually tells you if you qualify, but the federal processor was not able to factor in the new rate soon enough to be reflected on FAFSAs already processed and SARs already issued. As a result, the federal processor will be reissuing Student Aid Reports to students and schools beginning January 28 for students who have an EFC that falls between the old cut-off and the new. You may receive a revised Student Aid Report where no information was changed, but you will now have the message that you are eligible for Pell Grant. If you're not sure why you're receiving a new SAR, be sure to read the paragraphs on the first page.

The other news is that Congress has set pre-determined increases in Pell Grant over the next five years. While an increase is nice, I can't completely call it good news because the increases won't keep up with the cost of your education. The following increases have been passed:

2009-10 still $4800
2010-11 $5,000
2011-12 still $5,000
2012-13 $5,400

These increases will happen, but let's wish for the new administration to support further funding to expand the Pell Grant program even more. I say that because we all know that nothing in Congress remains constant. Reauthorization, which is usually a complete review of the financial aid system, has been extended for several years with no final action taken. A new President and a new Congress could quickly change things. Let's just hope it's for the better.

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For Teacher Education Students

ter — Wed, 16 Jan 2008 00:36:00 GMT

The new federal TEACH Grant (Teacher Education Assistance for College and Higher Education Grants) program is currently in negotiated rulemaking, as I mentioned in my previous post. This grant will be effective for the 2008-09 academic year. What I have heard about this program is this:

The TEACH Grant is intended to provide a grant in the amount of $4,000 per year ($16,000 maximum for undergraduate or certification and $8,000 for graduate) for students in a teacher program who plan to teach in a Title I school in certain “high need” subject areas after graduation. These “highly qualified teachers” must teach a minimum of four years within eight years after completing a teacher program. At this time, “highly qualified teachers” has not been defined. Students must be taking courses that are in the teacher degree program, and must have a 3.25 GPA. How the GPA is determined (cumulative, I assume) has yet to be determined.

Now, while this sounds like a good thing, there are drawbacks. If you fail to meet the teaching requirements after graduation, you will be required to repay the grant as a Direct Unsubsidized Loan from the date the grant was originally disbursed. This means interest will have accumulated during the period you were in school. It will turn into a loan!

There is a new question on the 2008-09 FAFSA on the Web in the “Info About You” section that asks if you plan on completing coursework to be an elementary or secondary teacher. The question will not appear on the paper FAFSA. At this time, your answer will not appear on your Student Aid Report. The federal processor plans to send new electronic Student Aid Reports to schools in mid-February for those who have answer yes to this question.

At this time, a national committee has been formed, including personnel from the elementary and secondary field, as well as those in post-secondary education, to participate in negotiated rulemaking. As I mentioned in my last post, negotiated rulemaking is voluntary. While this committee does not have final say in the implementation of this program, the Department of Education does take their suggestions and proposals into consideration.

For you teacher education majors, stayed tuned. I’ll keep you informed as rules and regulations are defined for this program.

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NPRM . . . Not NPR

ter — Fri, 11 Jan 2008 23:13:00 GMT

No, it's not National Public Radio. It's time for Negotiated Proposed Rulemaking. What is that, you ask?

Well, in 2007, the Department of Education began reviewing policies and procedures for financial aid based on legislation and legislative actions. The Negotiated Proposed Rulemaking process is most commonly called "Negreg" among the financial aid community. Believe it or not, legislation is often vague in their rules regarding the execution of financial aid programs. Therefore, the Department of Education must interpret the legislation and devise standards and rules for these programs.

Negreg is important to financial aid administrators as well as students. The Department of Education assembles an advisory committee of 12 to 25 individuals who would be directly impacted by financial aid rules. This committee, which includes financial aid administrators and student representatives, reviews policies, procedures, and legislation to create and revise rules regarding financial aid programs. Sometimes, the committee must create new rules, as with the Academic Competitiveness Grant and SMART Grant (we'll review these in a future blog) which were introduced in the last two years.

The Negreg committee tries to come to a consensus on proposed rules that benefit students and make financial aid administrators' lives easier in implementing programs. This is the time when students can offer their input to financial aid administrators regarding financial aid programs. The National Association of Student Financial Aid Administrators (NASFAA), which is made up of financial aid personnel from all over the country, are a major force of input to the Department of Education. I would venture to guess that your school has at least one financial aid administrator involved in NASFAA. Once the Department of Education and committee has completed its negotiated rulemaking process, a public comment period is enacted. This is where all financial aid administrators can solicit their opinion.

The Negreg committee is strictly voluntary and their proposals do not have to be implemented, but historically the Department of Education has taken these proposals seriously. If the committee is unable to reach a consensus on rules, the Department can continue to perform as usual.

The hot topics for Negreg are the new TEACH grant and student loans. Because of the volume of issues involved with these programs, I won't go into detail for each, but I will say that negotiations are being considered for loan rules regarding military, Public Service Loan Forgiveness, and lender/school relationships, among others. I will keep you informed as new rules are established.

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