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Information for Students About Financial Aid
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Financial Aid
From talking to many students and student groups, to watching and participating
in rallies, it’s clear to me that higher education is unaffordable for too many
highly qualified students. As students and their families go deeper in debt to
pay for these rising costs, many feel overwhelmed. The Federal government
provides a range of financial aid that can make a significant difference in
helping students complete their education, and pursue their academic goals.
U.S. Federal Assistance
There are three main types of federal assistance available to students: grants, loans,
and work-study programs. Grants do not need to be repaid,
loans do need to be repaid, and work-study programs
allow you to earn money for educational costs while in school, and do
not need to be repaid.
To receive aid from these federal student aid programs, you must complete a
Free Application for Federal Student Aid (FAFSA). The information you report on
the FAFSA is used to calculate an "Expected Family Contribution"
(EFC) according to a formula set by Congress. Your school will use your EFC to
determine what federal, state, and institutional aid you are eligible to
receive.
For more information on how (and why) to complete the FAFSA application, visit
the “
Completing the FAFSA” website. The application itself can be completed online at
www.fafsa.ed.gov.
For more specific information about the main types of aid that are available,
including links to relevant portions of the Guide, please see below.
Federal Pell Grants
Aid Available: Pell Grants are need-based and do not have to be repaid. Pell
Grants can provide anywhere between $400 and $4,500 per year.
The Fine Print: Available to undergraduate students only. The amount of
aid available to you depends on Expected Family Contribution (EFC) as well as
your cost of attendance, whether you're a full-time or part-time student, and
whether you attend school for a full academic year or less.
For More Information:
Click on this link.
Academic Competitiveness Grant
Aid Available: In 2005 the Secretary of Education authorized a grant for students who qualify for Pell Grants. The Grant will provide up to $750 your first year of college and up to $1,300 your second year.Fine Print: To qualify you must be a
Click on this link.
Federal Supplemental
Educational
Aid Available: Aid anywhere between
$100 and $4,000 per year is available to students with exceptional financial need.
Students do not need to receive the Pell Grant to qualify, but priority is
given to those students.
National Science and
Mathematics Access to Retain Talent Grant (National SMART Grant)
Aid Available: Up to $4,000 for
students in their 3rd or 4th year of college studying
mathematics, critical-need languages, engineering, technology, or science.
Fine Print: Students must be Pell
Grant recipients, must be
Aid Available: Aid is available to
both undergraduates and graduate students. Undergraduates may be awarded up to
$4,000 per year and graduate students may be awarded up to $6,000 per year.
Unlike grants, this loan must be repaid after graduation.
Fine Print: Recipients of Federal Perkins
Loans will be charged 5% regardless of undergraduate or graduate status. You
will be required to repay the school that gave you the loan.
For More Information:
Click on this link.
Federal
Aid Available: Stafford Loans are also loans which must be repaid.
First-year undergraduates are eligible for loans up to $3,500. Amounts increase
to as much as $8,500 depending on grade level. For unsubsidized loans, students
may receive as much as $10,500, also depending on grade level and dependency
status (how much your parents are able to pay).
The Fine Print:
If you qualify (based on need) for a subsidized Stafford loan, the government
will pay the interest on your loan in school, during the 6- month "grace
period" after leaving school and during any deferment periods. If your
family income makes you ineligible for a subsidized loan, you can still receive
an unsubsidized Stafford Loan. In that case, you are responsible for paying all
of the interest that accrues on the loan, including your time in school. In
either case, the interest rate is variable, but never exceeds 8.25%
Some lenders offer special discounts, so it is a good idea to check several
resources.
For More Information:
Click on this link.
Consolidation Loans
Aid Available: A Consolidation Loan allows the borrower to consolidate
several types of federal student loans with various repayment schedules into
one loan. You can even consolidate just one loan into a Direct Consolidation
Loan to get benefits such as flexible repayment options.
The Fine Print: You can get a Direct Consolidation Loan during your
grace period, once you have entered repayment, or during periods of deferment
or forbearance. You must consolidate at least one Direct Loan or FFEL Loan. If
you don't have a Direct Loan, but you have a FFEL Loan, you must first contact
a FFEL lender who makes FFEL Consolidation Loans to ask about obtaining a FFEL
Consolidation Loan. If you are still in school, you may apply for a Direct
Consolidation Loan for any Direct Loans or FFEL Loans if you are attending at
least half time and have at least one Direct Loan or FFEL Program loan in an
in-school period.
For More Information:
Click on this link or www.loanconsolidation.ed.gov
Federal PLUS Loans
Aid Available: These are unsubsidized loans made to parents that must be
repaid. The yearly limit on a PLUS Loan is equal to your cost of attendance
minus any other financial aid you receive. For example, if your cost of
attendance is $6,000 and you receive $4,000 in other financial aid, your
parents could borrow up to--but no more than--$2,000.
The Fine Print: PLUS Loans are made either through the school (Direct
Loans) or through a private lender. (If you are independent or your parents
cannot get a PLUS loan, you are eligible to borrow additional
For More Information:
Click on this link.
Work Study Programs
Federal Work-Study
For More Information:
Click on this link.
Other Programs
Links to additional sites with information about Financial Aid
Tax Credits - Hope Tax Credit, Lifetime Learning Tax Credit &
Loan Interest Deductions
Aid Available: These income tax credits reduce your or your family’s
federal taxes. They are based on your college tuition and fee charges, minus
grants scholarships, and other tax-free educational assistance. The Hope tax
credit can be claimed during the first two years of college, up to a maximum of
$1,500. The Lifetime Learning tax credit is available for any level of postsecondary
study, up to a current maximum of $1,000. Loan Interest deductions are
available on 100% of interest paid on loans for tuition, books, room, board,
and transportation. This includes up to $1500 for 1999, $2000 for 2000 and
$2500 thereafter.
The Fine Print: If your parents claim you on their income tax return,
they would be eligible to take the credit on their taxes. If you are not
claimed as a dependent on anyone else’s tax return, you would be eligible to
claim the credit. The credits are not available to single filers with adjusted
gross incomes greater than $50,000 or joint filers with adjusted gross incomes
greater than $100,000. Also note that only one type of credit (Hope or Lifetime
Learning) may be claimed for the student in any given year. Loan Interest
deductions are available even to people who claim the standard deduction.
For More Information:
General information about the federal Student Financial Assistance Programs,
including help in completing the required Free Application for Federal Student
Aid (FAFSA) (www.fafsa.ed.gov),
is available at 1-800-4-FED-AID (1-800-433-3243).
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Wired Scholar-Paying for College
http://www.wiredscholar.com/paying/content/index.jsp
Student Loan Net
http://www.studentloan.net
Federal Trade Commission: Scholarship Scams
http://www.ftc.gov/bcp/conline/edcams/scholarship/index.html
Financial Aid Information Page
http://www.finaid.org
IRS Publication 970: Tax Benefits for Higher Education
http://www.irs.gov/pub/irs-pdf/p970.pdf
Peterson's Education Center
http://www.petersons.com
Sallie Mae: Student Loan Marketing Association (SLMA)
http://www.salliemae.com
Scholarship Resource Network
http://www.srnexpress.com
US Department of Education - Office of Postsecondary Education
http://www.ed.gov/finaid.html
Federal Educational Benefits for Veterans
http://www.gibill.va.gov