# Presentation: 260078

## STUDENT FINANCIAL ASSISTANCE: Helping families pay for higher education

- San Antonio, TX
- October 10-11, 2006
- Raul M. Galvan
- US Department of Education Dallas, TX

**Notes:**
MM will do intros

## Topics

- Free Application for Federal Student Aid (FAFSA)
-  Online Application and the Worksheet
-  Paper Application
- Types of Aid Available
-  Federal
-  State
- FAFSA Filing Assistance
- Resources for Information

**Notes:**
I’ll be covering the FAFSA application process, both electronic and paper versions.
As well, I will give a brief overview of the types of aid available.
Maria will discuss how to get assistance in order to complete the FAFSA and will conclude with a list of Resources for more information.

## What is the FAFSA?

- All students applying for any federal and most state assistance must complete the ***Free Application for Federal Student Aid***** (FAFSA)**
- The FAFSA information is used to determine the student’s eligibility for all federal aid and most types of state assistance.

**Notes:**
In order to apply for any Federal Student Aid and most State Student Aid, students must complete the Free Application for Federal Student Aid, the FAFSA.
The information you provide on the FAFSA form is used to determine the types of aid the student would be eligible to receive.
In the next few slides, we’ll talk about the “FAFSA Basics” and we’ll cover those items that affect or determine a student’s eligibility.

## FAFSA Basics

- Dependent Students – Parent information required and parents must sign
- Complete early – check school and state deadlines
- Keep a copy of the completed FAFSA as well as copies of all source documents
- www.fafsa.ed.gov
- www.pin.ed.gov

**Notes:**
Here are a few basic principles to keep in mind.
Parent info will be required if the student applying is considered Dependent as determined by the FAFSA guidelines (we’ll discuss this more in a moment).
The FAFSA provides State App Deadlines, please review them so that you don’t miss an important deadline
Stay organized and keep good records—a copy of each FAFSA you complete and the tax records you used to complete them.  PLEASE READ all correspondence.
The address to apply online...it’s the best...quick and easy...fafsa.ed.GOV not .com.
Apply for a PIN at pin.ed.gov.  You may also apply for a PIN while completing the FAFSA.

## Independent vs. Dependent Students

- You are dependent *unless* at least one of the following applies:
- Born before January 1, 1984
- Masters or doctoral student in 2007-2008
- Married (as of FAFSA filing date)
- Have children who receive more than half of their support from you
- Have dependents (other than children or spouse)
- Orphan or ward of the court
- Currently serving on active duty
- Veteran of the U.S. Armed Forces

**Notes:**
Here are a few points to consider regarding ED’s definition of Independent status...you must be at least one of the follow:
24 yrs old, graduate student, married, have children or dependents other than spouse or child, an orphan or a Veteran
NOTE:  IN ORDER TO BE CONSIDERED INDEPENDENT BY VIRTUE OF HAVING DEPENDENTS, SAID DEPENDENTS MUST BE OTHER THAN CHILDREN AND SPOUSE, AND MUST LIVE WITH YOU (STUDENT) AND RECEIVE MORE THAN HALF OF THEIR SUPPORT FROM YOU, NOW AND THROUGH JUNE 30, 2006.

## Slide 6

## FAFSA on the Web for 2007-2008

- www.fafsa.ed.gov
- Available January 1, 2007
- English or Spanish
- Faster processing: 24 - 72 hours vs. 4-6 weeks for paper FAFSA
- Built-in edit checks to ensure accurate completion
- Electronic signature available (need PIN)
- Electronic notification

**Notes:**
Completing your FAFSA on the web is the quickest and most efficient way to submit your FAFSA.  A few things to note:
The 05-06 version is already available and can be completed in either English or Spanish
FOTW processing is much faster, 24-72 compared to 4-6 weeks doing the paper version.
FOTW is more accurate because there is built in logic that checks answers against each other
You can sign electronically with a PIN.  If you don’t have a PIN, you can apply before completing the FAFSA at pin.ed.gov.  You can also link to the pin site while completing the FAFSA.  It only takes about a day to get your pin after you have applied.  You can save your FAFSA, and then retrieve it to sign it with your PIN when you receive it.
If you’ve provided a valid email address in the FAFSA, you will be notified electronically that your FAFSA was received for processing.

## FAFSA on the Web www.fafsa.ed.gov

**Notes:**
Screen shot of FAFSA on the web:  www.fafsa.ed.gov

## Slide 9

## Slide 10

**Notes:**
The paper FAFSA is green this year.  Notice the IL financial aid applicant cut-off dates (circled):  in IL the deadline for first time applicants is September 30th and for continuing applicants the cut-off date is August 15th.  These dates will be discussed in a little bit more detail when Maria gets into the discussion about IL grants and scholarships.

## Slide 11

## Hints and Reminders for Completing the Paper FAFSA

- Use black ink or #2 pencil
- Print in capital letters
- Round off figures to the nearest dollar
- Write numbers less than 10 with a (0) zero first
- Answer questions referring to the “school year” as the year July 1, 2007 through June 30, 2008
- Answer enrollment plans according to the first choice college/university.
- Do not write “N/A” or margin notes

**Notes:**
If you don’t have the capability to use FOTW to complete your FAFSA, you can still complete the paper version.

Keep these notes in mind:
Note the slide points.

## PIN Website

- www.pin.ed.gov

**Notes:**
Screen shot of the PIN website:  www.pin.ed.gov

## Types of Federal Assistance

- Grants (do not need to be repaid)
- Pell
- Academic Competitiveness Grant (ACG)
- National Science and Mathematics Access to Retain Talent (National SMART Grant)
- FSEOG
- Self-help
- Work-study
- Loans (must be repaid)
- Federal Stafford
- Federal PLUS
- Federal Perkins

**Notes:**
Let’s quickly review the types of Federal and State Student Aid:
There are 2 catagories:  Grant aid and self-help aid.
Grants are monies that do not have to be repaid, like the Federal Pell Grant, Federal Supplemental Education Opportunity Grant or the Illinois MAP Grant.
Self-Help aid are monies that either need to worked for or need to be repaid.  Federal Work Study is an example of “grant” money that the student has to work for in order to receive. 
The Federal Stafford Loans, Parent PLUS Loans and Federal Perkins Loans are examples of low-interest loans from ED that students and parents can borrow, but they must be repaid.

## Federal Pell Grant

- Need-based grant
- Maximum 2006/2007 Award $4050, minimum $400, based on *full-time* attendance
- Does not need to be repaid
- Awarded to the neediest of undergraduates pursuing first baccalaureate degree

**Notes:**
Based on the EFC Calculation from the FAFSA App., a student may be eligible for the Pell Grant.  The grant is designed to go to the neediest students.  
The maximum grant for 05-06 will be $4050.
The grant doesn’t need to be repaid and is awarded to eligible undergraduate students.

## Academic Competitiveness Grant (ACG)

- Need-based grant
- U.S. Citizen
- Federal Pell Recipient
- First or second academic year student in a two or four year degree program
- First Year Maximum Award $750
- Second Year Maximum Award $1,300
*Full-time* attendance
- Completion of a rigorous secondary school program

## National SMART Grant

- Need-based grant
- U.S. Citizen
- Federal Pell Recipient
- Third or Fourth academic years of a bachelor’s degree program
- Third/Fourth Year Maximum Award $4,000
- Must be enrolled in a specific major in the fields of Computer Science, Engineering, Critical Foreign Language, Life Sciences, Physical Sciences or Technology
*Full-time* attendance
- Cumulative GPA 3.0

## Federal Supplemental Educational Opportunity Grant (FSEOG)

- Need-based grant
- Maximum award of $4,000 (2006/2007) based on availability of funds at the college, minimum $100
- Priority to Pell Grant Recipients with highest need
- Awarded to undergraduates pursuing first baccalaureate degree

**Notes:**
SEOG grants are awarded first to Pell grant recipients with the greatest need.
This award is for undergraduate students as well, with a maximum of $4000 or $4400 for Study Abroad.
They typical SEOG award is much less than $4000, however.  
This grant is managed more on a first-come first-served philosophy.  Schools want to be able to assist as many needy students as possible

## Federal Work-Study (FWS)

- Need-based employment program
- Provides jobs on and off campus, including community service and tutoring
- Students earn at least current minimum wage
- Students normally work up to a maximum of 20 hours per week

**Notes:**
FWS is also aid that is managed on a first-come first-served basis.  
Students are able to work at various jobs on and off campus for a specific hourly wage for up to 20 hours per week.
NOTE:  Work study does not mean studying while you are at work.

## Federal Perkins Loan

- Need-based student loan
- The FAFSA must be completed
- The college is the lender
- 5% fixed interest rate
- Eligible undergraduates may borrow up to $4,000 annually
- Repayment begins 9 months after graduation or if student drops below half-time enrollment
- Eligibility is determined by the college
- Some Discharge and Cancellation provisions

**Notes:**
This slide explains a little about how the Perkins Loan Program works, lets review.

DISCHARGE AND CANCELLATION PROVISIONS APPLY TO PERKINS AND STAFFORD LOANS.
DISCHARGES INCLUDE DISCHARGE FOR DEATH OR TOTAL AND PERMANENT DISABILITY AND FOR CLOSED SCHOOLS.
CANCELLATION PROVISIONS INCLUDE TEACHER CANCELLATION FOR SERVICE TEACHING LOW-INCOME FAMILIES; SPECIAL ED; TEACHER IN THE FIELDS OF MATHEMATICS, SCIENCE, FOREIGN LANGUAGES, OR BILINGUAL EDUCATION, OR IN ANY OTHER FIELD OF
EXPERTISE THAT IS DETERMINED BY A STATE EDUCATION AGENCY TO HAVE A SHORTAGE OF QUALIFIED TEACHERS IN THAT STATE.
ADDITIONAL CANCELLATIONS INCLUDE THOSE FOR NURSES OR MEDICAL TECHNICIANS, CHILD/FAMILY SERVICES, EARLY INTERVENTION SERVICES PROVIDER, HEAD START PROVIDER, LAW ENFORCEMENT OR CORRECTIONS OFFICER, MILITARY SERVICE OR PEACE CORPS
.

## Federal Stafford Loan

- Low-interest loan the student takes out on his/her own behalf
- The FAFSA must be completed
- Fixed interest rate set by Federal Government
- Rate is 6.8% (in-school/grace/deferment) for 2006-2007 through 6/30/2006 OR
- Rate is 5.3% (repayment or forbearance) for 2006-2007 through 6/30/2006
- Repayment begins 6 months after the student graduates or falls below half-time enrollment

**Notes:**
This slide covers the characteristics about Federal Stafford Loans, and you will note that there are some major differences compared to the Federal Perkins Program.
This too is a low-interest loan that the student can take out, but the school does not act as the lender as in the Perkins loan (banks or DL schools)
The FAFSA also acts as the loan application.
The interest rate is variable and changes every July, but will never exceed the cap of 8.25%
Currently the rate is at an all-time low at 3.37%
Repayment begins 6 months after the student grads or drops below 1⁄2 time attendance.

## Loan Differences(Subsidized vs. Unsubsidized)

- Financial Need
- Subsidized = based on need
- Unsubsidized = not based on need
- Loan Limits
- Dependent student
- Independent student

**Notes:**
Students are eligible for either Subsidized Stafford Loans if they demonstrate need based on their EFC and the COA of the school they wish to attend.  
If they do not demonstrate need for a Subsidized Stafford, they can still borrow an Unsubsidized Stafford.  
We’ll describe those differences in a moment.
The Loan limits for the Stafford are based on the student’s grade in college and also their dependency status.  
We’ll describe those limits in a moment as well.

## Loan Differences(Subsidized vs. Unsubsidized) continued...

- Payment of Interest
- Subsidized: federal government pays while student is in college and during grace/deferment periods
- Unsubsidized: payment is always student’s responsibility

**Notes:**
If a student qualifies for a Subsidized Stafford Loan, the government will pay the interest during deferment and grace periods (deferment during school of at least 1⁄2 time attendance or the grace period of 6 months after the student drops below 1⁄2 time attendance or grads)
If a student qualifies for the Unsubsidized Stafford, the student has the option to pay the interest or let it accrue during the deferment and grace periods.

## Federal Stafford Annual Loan Limits

- Undergraduate Students - ***Dependent***

- *  Fees not to exceed 4% are deducted from each loan disbursement.

**Notes:**
This slide describes the loan limits for undergraduate dependent students.
Note that the student receives the loan amount less the lending fees.  
Lending fees will not exceed 4% of the loan amount per disbursement

## Federal Stafford Annual Loan Limits

- Undergraduate Students - ***Independent***

_**Academic Level**_
**First Year**
**Second Year**
_**Third Year and Beyond**_
**Aggregate Total**

_**Subsidized**_*******	**_**Unsubsidized***_
**$2,625****	****	****	****$4,000**
**$3,500****	****	****	****$4,000**
_**$5,500**_**	****	****	**_**$5,000**_
**$46,000**

- *  Fees not to exceed 4% are deducted from each loan disbursement.

**Notes:**
This slide describes the undergraduate loan limits for an Independent student.  
The Unsub Loan shown here is actually an ADDITIONAL Unsub Stafford for Independent students or Dependent students whose parents are not credit eligible for the PLUS Loan.

## Federal Stafford Annual Loan LimitsGraduate and Professional Students

- Each Year of Study
- $8,500 subsidized (maximum)
- $18,500 unsubsidized (maximum)
- Total subsidized (grad and undergrad)
- $65,500 subsidized
- $138,500 unsubsidized

**Notes:**
While it may be a while before any of our high school seniors or their parents have to consider the loan limits for graduate study, this first bullet shows what those students enrolled in eligible graduate programs can borrow.
Also note that students do have an overall maximum aggregate loan limit for their undergrad and grad borrowing combined as noted in the second bullet.

## Federal PLUS Loan

- Federal _***P***_arent _***L***_oan for _***U***_ndergraduate _***S***_tudents
- Parent is the borrower
- Variable interest rate, capped at 9%.  Rate is 6.1% through 6/30/2006
- Maximum loan amount is the cost of attendance minus all financial aid received for the student
- Approval subject to a credit check
- Repayment begins 60 days after loan is disbursed

**Notes:**
Now lets talk for a minute about the PLUS Loan.
PLUS Loans are Federal Student Aid loans that parents can take out on behalf of the undergraduate/dependent children.  This loan may help bridge the gap between school costs and all of your other resources.
It too has a variable rate like the Stafford loans.  The rate changes every July but will not exceed the cap of 9%.  
The current rate is at a very low 4.17%
The limit for a PLUS Loan is up to the total COA at a school minus other financial aid.
Parents must pass the credit check, if not, the student would be eligible for the Additional Unsub Stafford for Independent students
Payment begins 60 days after the final loan disbursement.

## Stafford/PLUS Eligibility

- Maximum for Subsidized
- Cost of Attendance
- Estimated Family Contribution
- _Estimated Financial Assistance_
- 	= Maximum Loan Amount (up to limits)
- Maximum for Unsubsidized and PLUS
- Cost of Attendance
- _Estimated Financial Assistance_
-    = Maximum Loan Amount (up to limits)

**Notes:**
This slide explains the basics of how a maximum PLUS Loan amount and the Additional Unsub Amount are determined.
COA=both hard and soft costs associated with going to that particular school
EFC=as calculated based on the FAFSA App
EFA=the total of all other aid awarded prior to the loans (grants, scholarships, sub loans, etc.)

## Texas Grants

- Texas Health Service Corps Program: Stipends for Resident Physicians (THSC)
- Texas Public Educational Grant (TPEG)
- Tuition Equalization Grant Program (TEG)
- Vocational Nursing Scholarships (VNRS)

**Notes:**
MM begin here.  IL priority filing deadline is September 30th for new students, and August 15th for continuing students

## Texas Public Educational Grant (TPEG)

**Purpose:  To provide grant assistance to students with financial need**
- Texas residents, non-residents or foreign students
- Show financial need
- Register for the Selective Service or are exempt from this requirement
- No individual award may be more than the student’s financial need

## Tuition Equalization Grant Program (TEG)

- Purpose:  To provide grant aid to financially needy students to enable them to attend private, non-profit colleges or universities in Texas
- Texas residents or are non-resident National Merit Finalists
- Show financial need
- Are enrolled in a private, non-profit college or university in Texas

## TEG cont’d

- If awarded their first TEG prior to 9/1/2005, meet the academic progress requirements of their institution;
- Earn and maintain an overall college GPA of at least a 2.5 on a 4.0 scale and complete at least 24 credit hours per year (18 credit hours per year if the recipient is a graduate student);
- Enrolled full-time

## TEG cont’d

- Are not receiving athletic scholarships
- Are required to pay more tuition than they would pay to attend a public institution; and
- Register for the Selective Service or are exempt from this requirement

## Vocational Nursing Scholarships (VNRS)

- Purpose: To provide financial assistance to encourage students to become Vocational Nurses
- Texas residents
- Show financial need
- Register for the Selective Service or are exempt from this requirement
- Enroll in classes leading to Licensure as a Vocational Nurse
- Enrolled on at least a 1⁄2-time basis

## Helpful Resources

- www.fafsa.ed.gov
- www.pin.ed.gov
- www.students.gov
- www.ed.gov/studentaid/sfa.html
- www.ed.gov
- (800)4 FED-AID (433-3243)
- http://www.thecb.state.tx.us (TX Higher Education Coordinating Board)
- www.fastweb.com

## QUESTIONS???

## My Contact Information:	

- 		Raul M. Galvan
- 		c/o The U.S. Department of Education
- 		1999 Bryan St., Suite 110
- 		Dallas, TX  75201
- 		Phone:  214-661-9455
- 		Fax:  214-661-9662
- 		E-mail:  raul.galvan@ed.gov