Important Financial Aid Updates
What is an FSA ID and Why Do I Need One?
In order to complete the Free Application for Federal Student Aid, students now need a Federal Student Aid ID (FSA ID), made up of a selected username and password. Students and parents should create their own in order to electronically sign their FAFSAs and other federal financial aid documents. Create an FSA ID using your own personal information and for your own exclusive use. You are not authorized to create an FSA ID on behalf of someone else, including a family member. Misrepresentation of your identity to the federal government could result in criminal or civil penalties.
Don’t have an FSA ID yet? Create one now.
Pell Grant Eligibility for 2016-2017
The Federal Pell Grant maximum award for 2016-2017 Award Year is $5,815. This maximum is an increase of $40 from the $5,775 maximum Pell Grant award for 2015-2016. The duration of Pell Grant eligibility remains to the equivalent of 12 full-time semesters.
Student Loan Interest Rates Will Drop for 2016-2017
Federal student loan interest rates are scheduled to go down effective with loans disbursed on or after July 1, 2016. The rates on undergraduate Direct Loans will drop from 4.29 percent to 3.76 percent for the 2016-17 academic year. The rate on PLUS loans, both parent loans for dependent undergraduates and those for graduate borrowers, will drop from 6.84 to 6.31 percent. The interest rates will be fixed for the life of the loan and are as follows:
|Loan Type||Borrower Type||Interest Rate|
|Direct PLUS||Parent of Student||6.31%|
New Federal Aid Tool Assist Student Borrowers Entering Repayment
The Office of Federal Student Aid has launched a new one-stop web page, to help borrowers navigate student loan repayment options and select their best option in five steps or less. The initiative is part of the federal government’s push to enroll as many student borrowers as possible in income-driven repayment plans for their student loans.
Visiting the repayment site, users will find a tool that steps them through several questions, leading them to options best suited to each individual situation. According to information issued by the White House and the U.S. Dept. of Education, students can find the best loan repayment option in 60 seconds or less using the tool. Visit studentloans.gov/repay to try it out.
The tool builds on steps announced in December 2015 to expand Pay As You Earn (PAYE) loan repayment plans that help make it easier for borrowers struggling to pay student loan debt. Under PAYE plans, borrowers needing help handling their debt will not pay more than 10 percent of income toward student loan payments and some monthly payments may be reduced to zero. President Obama has said he hopes to enroll two million more people in Pay As You Earn by Spring 2017.
Students Allowed to Apply for Financial Aid Early for Fall 2017
A presidential executive action on Sept. 14, 2015 will allow earlier year tax information on the Free Application for Federal Student Aid, or FAFSA, effective with the 2017-18 academic year.
The change will make the FAFSA, available in October 1, 2016 for students applying for aid for Fall Term 2017. This allows families to use 2015 tax return information for their application instead of waiting to use information from 2016. Previously, the FAFSA was not made available until January 1st prior to Fall Term and families had to either estimate income or wait until filing tax returns to complete the FAFSA. This change will increase the FAFSA’s accuracy and give families an earlier and more accurate idea of their anticipated financial aid and college costs.
Don’t Pay for Loan Debt Relief Services
Have student loans? You’ve probably seen social media ads, received emails, or even opened a piece of mail from companies promising to reduce your monthly loan payments or cancel your loans.
Here’s the catch. These companies are doing something you can do yourself, but they’ll charge you a fee. The U.S. Department of Education provides FREE assistance to help you:
- Lower or cap your monthly loan payment;
- Consolidate your federal loans;
- See if you qualify for loan forgiveness;
- Get advice on getting out of default.
Alert: Your Federal Direct Loan Subsidies are Time Limited
Subsidies are limited for first-time and new Federal Direct Subsidized Loan borrowers. This federal regulation took effect on July 1, 2013 and affects all new borrowers from that point forward. If you reach 150 percent of your degree program (for example, attending 6 years for a 4-year program) you will:
- Not be eligible for additional Direct Subsidized Loans (though you may borrow a Direct Unsubsidized Loan) and
- Be responsible for interest accrued on all loans from that point forward
New borrowers are students with no outstanding federal loan principal balance when they take out a new loan. HCU will track a student’s progress in their program to determine whether they continue to be eligible for subsidized federal Direct Loans. Students are encouraged to complete their degree program within the suggested timetable to avoid losing their federal loan subsidies. Because this is a federal regulation, there is not an appeals process. The Office of Financial Aid is available to discuss your individual situation or any questions you may have about financial aid.
Newly Admitted Transfer Student Eligibility
Satisfactory academic progress status is based on the student’s entire academic record, at all schools attended, regardless of whether financial aid was received or not. Beginning with the 2014-2015, newly admitted transfer students will have their SAP calculated based on final academic transcript(s) from all schools attended. In order to be eligible for financial aid, students must satisfy all components:
- Minimum cumulative grade point average:
- Students who have attempted fewer than 60 semester hours must have a cumulative GPA of at least 1.8.
- Students who have attempted 60 or more semester hours must have a cumulative GPA of at least 2.0.
- Minimum completion rate of 67%
- Maximum time frame of 150% of defined academic length for the undergraduate program.
If the transfer student’s SAP status is determined to be unsatisfactory, the student will not be eligible for financial aid until SAP standards are met.
Repeat Course Policy for Financial Aid Purposes
Changes in federal regulations (34 CFR Section 668.2) now require the Office of Financial Aid to monitor and adjust a student’s enrollment level for Title IV aid if, or when, they repeat course work for credit that they have already earned. Students can retake courses and receive federal aid if they had previously failed a course, but can only receive financial aid one more time for a course that has been previously passed. A passing grade is defined as D- or better.
The policy allows a student to receive financial aid under the following situations:
• To repeat any failed course until a passing grade is received.
• To repeat one time any course in which you previously received a passing grade.
New, stricter rules, require students to attend and complete their enrolled hours, or pay their financial aid back, even if they still owe tuition. Please contact the Office of Financial Aid at firstname.lastname@example.org BEFORE you add or drop classes. Both may significantly affect your financial aid award.