Welcome to the Michigan High School CounselorVideo Conference November 2, 2007
Federal Update Rick Shipman, Director Office of Financial Aid Michigan State University November 2, 2007
What is Federal Financial Aid? • Grant Programs • Pell Grant • Supplemental Educational Opportunity Grant • Academic Competitiveness Grant • National Science and Math Access to Retain Talent (SMART) Grant • Work Study Program • Loan Programs • Perkins Loan • Stafford Loan • Federal Family Education Loans • Federal Direct Loans • PLUS Loan
Free Application for Federal Student Aid (FAFSA) • Initial step in the application process • Core “document” to apply for financial aid • Used to calculate an Expected Family Contribution (EFC) • Confirms certain eligibility requirements
Free Application for Federal Student Aid • Cannot submit earlier than January 1, 2008 • Valid for periods beginning summer 2008 and ending after summer 2009, but generally not more than 12 months • No fees
How to Apply The FAFSA • Paper application • Web application
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
How The Data Are Used? • Determine federal compliance: • Social Security • Selective Service • Immigration and Naturalization Services (INS) • Federal debts
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)
Completing the Paper FAFSA • About 5% of FAFSAs are now filed by paper. • Paper FAFSAs are only available through download at federal Web sites 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. • No major question or order changes from 2007-08.
Completing FAFSA on the Web • More than 95% of FAFSAs are now filed online. • No major changes from 2007-08 FAFSA. • Parents with more than 1 college student can transfer data from original application to others. www.fafsa.ed.gov
FAFSA on the Web Worksheet • Families can use time wisely by completing a worksheet before accessing FOTW. • Order Worksheets at www.fsapubs.org or by phone. • View a draft of the worksheet on the Web at the URL below. www.ifap.ed.gov - Click on FAFSAs and Renewal FAFSAs link under Publications
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: • Corrections on the Web • NSLDS • Direct LoanOrigination • Direct Loan Servicing • Loan Consolidation
Demonstration Site for FOTW • Available in December 2007 • FAFSADEMO.TEST.ED.GOV • User Name: EDDEMO • Password: FAFSATEST
With 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.
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 U.S. Department of Education (ED) 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.
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. • Submit to college only if requested. • 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.”
Corrections on the Web • Available regardless if original application was paper or electronic. • Student’s PIN required to access. • Parents must have PIN to correct parent information. • Pop-up message will appear when student tries to correct transaction already corrected by a school.
Avoid Errors! • Errors on the FAFSA or supplemental forms may delay application processing and result in the loss of financial aid funds. • Encourage students/parents to read the instructions and complete the forms carefully!
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."
Independent Student Criteria • Born before January 1, 1985 • Enrolled in a graduate program • Married • Has child(ren)/dependents for whom he/she provides more than half support • Both parents are deceased • Is/was a ward of the court until age 18 • Veteran of the U.S. Armed Forces or currently serving on Active duty in the U.S. Armed Forces for purposes other than training • Most high school students will not be independent but, in extraordinary circumstances, the college aid administrator can override dependency. Contact the college aid office for help.
Types of Federal Aid – Grants • FAFSA required for all federal grants • Pell Grant Program • Undergraduates pursuing first baccalaureate degree • $400 to $4,800 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 lowest EFCs at that school) • Priority to Federal Pell Grant recipients • $100 to $4,000 per year
Types of Federal Aid – Grants • Academic Competitiveness Grant • For Pell eligible US Citizens • A 3.0 GPA required beyond freshman level • ACG is for freshmen and sophomores who completed a rigorous HS curriculum • Freshmen get $750; sophomores $1,300
Types of Federal Aid – Grants • Academic Competitiveness Grant • ED provides 5 categories of rigorous curricula • State established advanced or honors program • State Scholars Initiative • A curriculum similar to State Scholars • Completion of at least 2 AP courses with scores of 3 or 2 IB courses with scores of 4 • Approved state designated program • Michigan Merit Standard qualifies • State Scholars Initiative • 4 Years of English • 3 Years of Math • 3 Years of Science • 3 Years of Social Studies • 1 Year of Foreign Language
Types of Federal Aid – Grants • SMART Grant • For Pell eligible U.S. citizens • 3.0 GPA required beyond the freshman level • For junior/senior students in specific majors • Computer Science, Engineering, Foreign Language, Life Sciences, Mathematics, Physical Sciences, Technology • $4,000 per year
Types of Federal Aid – Grants • Teacher Education Assistance for College and Higher Education (TEACH) Grant • For Pell eligible students • 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 Direct Loan if student fails to teach for 4 years within 8 years of graduation
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
Types of Federal Aid – Loans • Federal Stafford Loan • Must file FAFSA to be eligible • Annual loan limits • $3,500 for Freshmen • $4,500 for Sophomores • $5,500 for Juniors and Seniors • $20,500 for each year of study • Subsidized: must demonstrate “need” • Unsubsidized: “need” is not a consideration • 6.8% fixed interest rate (6% for undergrad, subsidized beginning in fall ’08) • 10 year repayment
Types of Federal Aid – Loans • Federal Grad PLUS • Required to file FAFSA • Creditworthiness determined by lender • Co-signer may be required • Loan limit is cost of education minus other aid • Repayment begins approximately 60 days after loan fully disbursed • In-school deferments provided • 7.9%/8.5% fixed interest • 10 year repayment
Types of Federal Aid – Loans • Federal Parent PLUS • Not required to file FAFSA • Creditworthiness determined by lender • Co-signer may be required • Loan limit is cost of education minus other aid • Repayment begins approximately 60 days after funds are fully disbursed • 7.9%/8.5% fixed interest • 10 year repayment
Types of Federal Aid – Work • Federal Work-Study • Employment during school • Reimburses employer for a percentage of student earnings • Non-profit jobs only (on or off campus) • Income is taxable (state and federal) • Excluded from student’s total income on next year’s FAFSA • Program varies from school to school
Supplemental Forms • Institutional application • Stafford loan application • Parent/Grad PLUS loan application • CSS Financial Aid PROFILE (school aid)
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
What Everyone Should Know www.FederalStudentAid.ed.gov • Gateway Web site • New FAFSA4caster • Portals for… • Students, Parents, and Counselors • Financial Aid Counselors • Financial Partners
FAFSA4caster www.fafsa4caster.ed.gov • Provides early estimate of federal aid eligibility • PIN not required • FAFSA4caster data can transfer to FAFSA
Special Circumstances in Financial Aid Aiding Students Who Have Special Circumstances
Free Application for Federal Student Aid (FAFSA) • Some families find the application difficult. • Many feel the FAFSA does not reflect their true circumstances. • Before an appeal can be considered for special circumstances, students and their families must complete the FAFSA with base year information.
Working With the Financial Aid Office • Complete the FAFSA. • Student contacts the Financial Aid Office where he/she plans to attend. • If not committed to a college, student should contact each Financial Aid Office at the schools they most likely will attend.
Professional Judgment When a financial aid officer reviews a special circumstances appeal from an applicant and approves an adjustment to the original FAFSA or waives a FAFSA requirement, he/she has used professional judgment.
Common Elements in Professional Judgment • Financial aid officers are willing to consider the special circumstances of applicants. • Many financial aid officers share common values in evaluating special circumstances appeals.