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  1. WELCOMETO THE 2008 High School Counselor Financial Aid Update

  2. 2008 Host Sites • Adrian College • Alpena Community College • Baker College – Allen Park • Baker College – Auburn Hills • Baker College – Cadillac • Baker College – Clinton Township • Baker College – Jackson • Bay de Noc Community College

  3. 2008 Host Sites • Central Michigan University • Copper Country ISD • Eastern Michigan University • Ferris State University • Grand Valley State University • Kalamazoo College • Lake Michigan College • Lake Superior State University

  4. 2008 Host Sites • Lansing Community College • Marygrove College • Michigan Public Health Institute – Interactive Solutions Group • Muskegon Community College • North Central Michigan College • Northern Michigan University • Northwestern Michigan College

  5. 2008 Host Sites • Saginaw Valley State University • St. Clair County Community College • University of Michigan – Flint • Wayne State University • Thank you to all site coordinators, contact people and tech coordinators for serving as a host site for the financial aid update workshop.

  6. Federal UpdateApplication Process and Aid Programs Pamela W. Fowler Executive Director, Office of Financial Aid University of Michigan November 14, 2008

  7. PIN Web Site www.pin.ed.gov • PIN serves as electronic signature on ED documents, including electronic promissory notes. • PIN is used to gain access to ED systems, including: • FAFSA Corrections on the Web • NSLDS (repository for information on all of student’s federal aid) • Direct Loan Origination • Direct Loan Servicing • Loan Consolidation • Student and Parent need a PIN (apply now) • Use the same PIN throughout college and until all federal loans are fully repaid

  8. Free Application for Federal Student Aid (FAFSA) • Initial step in the application process • Core “document” to apply for all types of federal and state financial aid • Used to calculate an Expected Family Contribution (EFC) • Confirms certain eligibility requirements

  9. Free Application for Federal Student Aid • Cannot submit earlier than January 1, 2009 • Generally valid for up to 12 months; may begin summer 2009 or Fall 2009 and ending after summer 2010. • No fees to file the application.

  10. How to Apply • The FAFSA • Paper application • Web application

  11. Gather Information Needed to Complete the FAFSA • Social Security Number for student and parents • Completed 2008 federal tax returns and W-2 forms or 2007 completed tax returns (if 2008 return not completed) • Amounts of untaxed income received • Child support paid/received • Veteran’s benefits to be received • Names and addresses of colleges

  12. Completing the Paper FAFSA • About 5% of FAFSAs are now filed by paper. • Paper FAFSAs are only available through download at federal websites or by calling 1-800-4-FED-AID • Students & parents can complete on line and download as PDF file or download blank PDF file for completion and mailing

  13. Completing FAFSA on the Web • More than 95% of FAFSAs are now filed online. • Edits prevent many common errors • Parents with more than 1 college student can transfer data from original application to others www.fafsa.ed.gov

  14. FAFSA on the Web Worksheet • Families can use time wisely by completing a Worksheet before accessing FOTW • Print or Order Worksheets at www.fsapubs.org or by phone.

  15. Demonstration Site for FOTW • Available in December 2008 • FAFSADEMO.TEST.ED.GOV • User Name: EDDEMO • Password: FAFSATEST

  16. What Data Are Required? Step 1: Student demographic information Step 2: Student financial information Step 3: Dependency status questions Step 4: Parent financial information Step 5: Independent student household information Step 6: List of colleges to receive results Step 7: Signatures and certifications

  17. How The Data Are Used? • Determine federal compliance: • Social Security • Selective Service • INS (citizenship) • Federal debts, loan defaults

  18. How The Data Are Used? • In a statutory formula called the Federal Methodology • Looks at income, assets, and size of family to determine family’s “ability to pay” for education • Result is called the Expected Family Contribution (EFC)

  19. With (PIN) Electronic Signatures • It is not necessary to print and sign a paper signature page if both the dependent student and parent have a federal PIN. • The PINs are entered as part of the FOTW completion process and replace a pen and paper signature form.

  20. Without Electronic Signatures • If both the dependent student and parent do not have PINs, they must provide a signature page for the signatures and mail it. • It is permissible for the student or parent applicant to sign electronically with a PIN and the other to submit a paper signature form. • Signature page must be received by US Department of Education within 14 days. • If signature page is not received within 14 days, one will be sent to the applicant by mail. The form must be signed and resubmitted.

  21. Student Aid Report (SAR) • The SAR summarizes the data provided on the FAFSA as well as the federal calculations and is sent to the applicant. • Only last 4 digits of parent’s SSN will display on paper and electronic SARs. • Displays official EFC. • College receives an electronic SAR for each student. • Paper application without student’s e-mail address will result in paper Student Aid Report (SAR). • Paper application with student’s e-mail address will result in email with Web site for “SAR on the Web.”

  22. Correcting Information Submitted on FAFSA • If you submitted tax returns to the college, and you need to correct a figure that appears on the tax return, let the college correct it for you. • Pop-up message will appear when student tries to correct transaction already corrected by a college. Contact college if you get this message. • Corrections can be made online if original application was paper or electronic. • Student’s PIN required to access. • Parents must have PIN to correct parent information.

  23. Common Errors • Wrong Social Security Number • Mailed/submitted without signature • Name not the same as name on Social Security records • Listing taxes withheld and not taxes paid from the tax return • Not reading all information from the college’s aid office

  24. Who is the Parent? (for Dependent Students) • If the parents are both living and married to each other, answer the questions about both of them. • If the parent is widowed or single, answer the questions about that parent only. If the widowed parent has remarried as of today, answer the questions about that parent and the person to whom the parent is married. • If the parents have divorced or separated, answer the questions about the parent the student lived with most in the last 12 months. If the student did not live with one parent more than with the other, answer about the parent who provided the most financial support during the last 12 months or during the most recent year that the student was supported by a parent. If this parent has remarried as of today, answer the questions about both that parent and the person to whom the parent is married. • If the parent is widowed or divorced and has remarried, answer the questions about both that parent and his or her current spouse. The marital status of the student's parents in this case is "married/remarried."

  25. Independent Student Criteria • Born before January 1, 1986 • Enrolled in a graduate program • Married • Has child(ren)/dependents for whom he/she provides more than half support • An orphan, in foster care, ward of the court, or was one of the above at any time between age 13 and time application completed. • Is or was prior to attaining age 18, an emancipated minor or in a legal guardianship as determined by a court in the student’s state of legal residence. • Veteran of the U.S. Armed Forces or currently serving on Active duty in the US Armed Forces for purposes other than training

  26. Special Circumstances • Parents or students who have special financial or personal circumstances that may affect their eligibility for federal aid should contact the financial aid office at the college to request the college review their application in light of these hardships or unusual situations. The college will request documentation to support the conditions on which the request is made.

  27. What is Federal Financial Aid? • Grant Programs • Pell Grant • Supplemental Educational Opportunity Grant • Academic Competitiveness Grant (ACG) • National Science and Math Access to Retain Talent (SMART) Grant • TEACH (Teacher Education Assistance for College and Higher Education) • Work Study Program • Loan Programs • Perkins Loan • Stafford Loan • Federal Family Education Loans • Federal Direct Loans • PLUS Loan • Graduate PLUS Loan

  28. Types of Federal Aid – Grants • Pell Grant Program • Undergraduates pursuing first baccalaureate degree • $400 to $4,731 per year (beginning fall 2008) • Supplemental Educational Opportunity Grant • Undergraduates pursuing first baccalaureate degree • Awarded first to students with exceptional financial need (i.e., students with the highest Pell grant eligibility) • Priority to Federal Pell Grant recipients • $100 to $4,000 per year (average award under $2000)

  29. Types of Federal Aid – Grants • Academic Competitiveness Grant • For Pell eligible US Citizens • ACG is for freshmen who completed a rigorous HS curriculum or approved State HS curriculum • Eligibility is determined and documented by the College. • A 3.0 GPA required beyond freshman level to receive the grant for a second year • Freshmen get $750; sophomores $1,300

  30. Types of Federal Aid – Grants • SMART Grant • For Pell eligible US Citizens • 3.0 GPA required beyond the freshman level • For junior/senior students in specific majors • Computer Science, Engineering, Select Foreign Languages, Life Sciences, Mathematics, Physical Sciences, Technology • $4,000 per year

  31. Types of Federal Aid – Grants • Teacher Education Assistance for College and Higher Education (TEACH) Grant • Must file a FAFSA but not a need-based program; total aid cannot exceed the cost of attendance • Major in Math, Science, Foreign/Bilingual Education, Special Ed, Reading, Other • Requires teaching in underserved schools • $4,000 yearly ($16,000 max for undergrads, $8,000 max for grads) • Reverts to an unsubsidized Direct Loan if student fails to teach for 4 years within 8 years of graduation

  32. Types of Federal Aid – Loans • Federal Perkins Loan • Undergraduate or graduate students • Must file FAFSA to be eligible • Priority to those with exceptional need • Interest rate is fixed 5% • Nine-month grace period • Deferment, cancellation, and forgiveness provisions available • Up to $4,000 per year for undergraduates $6,000 for graduates

  33. Types of Federal Aid – Loans • Common Features of Federal Student Loans • The amount a student may borrow each academic year is based on their class level at time of application • Repayment does not begin until 6 months after student graduates or enrollment drops to less than 6 credit hours a term (excludes Perkins) • Interest rates are fixed; rates are subject to change each July 1 • Standard repayment term is 10 years but flexible repayment terms may be available to students and parents.

  34. Federal Loans Direct or Stafford • What is the difference between a federal Stafford Loan and a federal Direct Loan? • The source of funds. The sources of funds for the Stafford Loan program are banks, credit unions, savings and loans, etc. • The source of funds for the Direct Loan program is the U.S. Treasury. • All other aspects of the programs are the same.

  35. Types of Federal Aid – Loans • Federal Subsidized Direct/Stafford Loan • Annual loan limits • $3,500 for Freshmen • $4,500 for Sophomores • $5,500 for Juniors and Seniors • Subsidized: interest free while enrolled at least half-time and student must demonstrate “need” • 5.6% fixed interest rate on loans first disbursed after July 1, 2009

  36. Types of Federal Aid – Loans • Federal Unsubsidized Direct/Stafford Loan • Annual loan limits • Dependent Undergraduates - $2000 • Independent Freshmen and Sophomores - $6000 • Independent Juniors and Seniors - $7000 • Unsubsidized: interest accrues from the time loan is fully disbursed • 6.8% fixed interest rate

  37. Types of Federal Aid – Loans • Federal Parent PLUS • Not required to file FAFSA • Creditworthiness determined by lender • Cosigner may be required • Loan limit is cost of education minus other aid • Repayment begins approximately 60 days after funds are fully disbursed; may be deferred until student graduates (parent must request deferred option) • 8.5% fixed interest rate

  38. Types of Federal Aid – Loans • Federal Grad PLUS • Required to file FAFSA • Creditworthiness determined by lender • Cosigner may be required • Loan limit is cost of education minus other aid • Repayment begins approximately 60 days after loan fully disbursed • In-school deferment of payments provided • 8.5% fixed interest

  39. Types of Federal Aid – Work • Federal Work-Study • Employment during school • Employers are non-profit organizations (on or off campus) and in certain circumstances for-profit companies • Income is taxable (state and federal) • Earnings excluded from student’s total income on next year’s FAFSA • Program varies from school to school • Work should be limited to less than 20 hours per week

  40. Supplemental Forms • Institutional application (for school based aid; maybe online) • Stafford loan application (may be an online application) • Parent/Grad PLUS Loan application (may be an online application) • CSS Financial Aid PROFILE (for school based aid at select schools)

  41. After the FAFSA • Compile information on your college choices via the college website, admissions information, College Board website and federal websites • Search for private scholarships using a FREE search service • Compare financial aid offers using a worksheet like the one on the NASFAA.org or College Board website

  42. Counselor Resources • National Association of Student Financial Aid Administrators • WWW.NASFAA.ORG • Counseling Tools • Student Aid on the Web • WWW.STUDENTAID.ED.GOV • FSA for Counselors • http://ifap.ed.gov/FSACounselors/clcf/main.html • Online information for middle school, high school and TRIO counselors

  43. What Everyone Should Know www.FederalStudentAid.ed.gov • Gateway website • New FAFSA4caster • Portals for… • Students, Parents, and Counselors • Financial Aid Counselors • Financial Partners

  44. Counselor Resources

  45. FAFSA4caster www.fafsa4caster.ed.gov • Provides early estimate of federal aid eligibility • PIN not required • FAFSA4caster data can transfer to FAFSA

  46. collegenavigator.ed.gov

  47. Questions?