11

Financial Aid

2010-2011 FAFSA

Parts of this presentation come from the National Association of Student Financial Aid Administrators (NASFAA)

2

What we will discuss

• General Eligibility Requirements

• Types and Sources of Aid

• Federal and State Programs

• eStudent• Federal Grant

Programs

• Federal Loan Programs

• 2010-11 FAFSA• Need Analysis• Financial Packaging• College Goal

Packaging• *Review of paper

2010-11 FAFSA

33

General Eligibility Requirements

Must be enrolled or accepted for enrollment in an eligible program of study, pursuing a degree, certificate or other recognized credential.

Must be a U.S. citizen or eligible non-citizen. Must be registered with Selective Service – if male and required,

males can register on-line at: www.sss.gov. Must not have had eligibility suspended or terminated due to a drug-

related conviction while receiving financial aid. Must have a valid social security number . May not be in default of a student loan or owe repayment of a

federal grant. Must meet Satisfactory Academic Progress as defined by college

(Quantitatively-GPA Qualitatively-credit hours taken and completed.)

44

Types and Sources of Financial Aid

TYPES:

Grants and Scholarships

Loans and Work – Self Help

SOURCES:

Federal Government

State Government

College

Private Donors

Lenders

55

Federal Title IV Programs Grants/Scholarships Academic Competitiveness Grant (ACG) SMART Grant Supplemental Educational Opportunity Grant

(FSEOG) (Campus-Based) Pell Grant T.E.A.C.H Grant

Self Help Work Study (FWS) (Campus-Based) Perkins Loan (Campus-Based) Stafford or Direct Loan Parent Loan for Undergraduate Students (PLUS

Loans)

6

State Grant (SSACI) Programs http://www.in.gov/ssaci/programs/

Frank O’Bannon Grant Higher Education Award (HEA) Freedom of Choice Grant (FOC) Academic Honors and Core 40 Diploma bonuses

Additional Grant Programs for specific populations

Twenty-first Century Scholars Scholarship (application required in middle school)

National Guard Supplemental Grant Child of Veteran/Public Safety Officer Supplemental Grant (CVO)

7

All SSACI Programs…Continued

Part Time Grant Robert C. Byrd Honors Scholarship Minority Teacher & Special Education

Services Scholarship Nursing Scholarship Program State Work-Study Program

8

There are two important DEADLINES for the O’Bannon and 21st programs MARCH 10TH : Date FAFSA must be RECEIVED

by the federal processor FAFSA Correction State Deadline!

MAY 15, 2010 FAFSA edits that are correctable must be CORRECTED with the federal processor by this date in order to remain in the state grant applicant pool.

SSACI will be sending all edit notifications via email to students. Email will direct student to estudent to learn more

State Grant Deadlines

Important for student to CHECK eStudent!

www.ssaci.in.gov/estudent

9

Important State Grant FACTS• SSACI Residency Requirements: The student and parent (if

dependent) must complete the FAFSA questions regarding residency. Must physically reside in Indiana (e.g. 2010-2011 academic year award period, date is as of 12/31/2009 and continue to remain in the state up to and including the award period - 2010-2011 academic year).

• SSACI will calculate the student’s state grant eligibility for the FIRST eligible Indiana college the student placed on the FAFSA. Students who will not attend the first choice originally listed when the student filed the FAFSA must:

change college choice on eStudent to reflect their first college choice to ensure an accurate state grant award notification and

IF the college was NOT listed on the FAFSA student must contact federal processor and add college to FAFSA list

10

•SSACI state grant eligibility is determined on the basis of both merit and need. The information from the FAFSA, the approved college tuition and regularly assessed fees up to the CAP, and a high school diploma type are factors in determining eligibility

•Students can check their diploma type at www.ssaci.in.gov/estudent along with their state award history.

•Emancipated Minors are not considered independent for SSACI purposes and will have to provide their parent data to be considered for SSACI awards.

11

eStudentwww.ssaci.in.gov/estudent

eStudent is a secure on-line section of the State Student Assistance Commission (SSACI) website where students may access their state grant information in order to determine if corrections are needed and where those corrections must be made:

1) Go to eStudent (see above) if you are changing your first college choice on your FAFSA, making address changes or want to view the student’s state grant award history

2) FAFSA edit corrections must be made at the federal processor www.fafsa.ed.gov and use your and your parent’s PIN number as an electronic signature

3) Anytime you update or change your FAFSA please visit

wwww.ssaci.ingov/estudent (state receives changes 48-72 hours after you make them) to see if you have created any additional issues that need to be resolved.

12

Federal Grant Programs

1313

Federal Pell Grant

Awarded to eligible undergraduates pursuing first bachelor’s or professional degree and certain students enrolled in post-baccalaureate teacher certification or licensing programs. Considered an “entitlement” program.

Actual award amount based on Cost of Attendance, Expected Family Contribution (EFC), and Enrollment Status. Unlike other financial aid, other aid that the student qualifies for will not affect the amount of the Pell Grant.

$5,350 Maximum 2009-2010.

1414

Academic Competitiveness Grant (ACG)

Eligibility $750 first academic year, $1300 second academic year. Student must have a 3.0 or above to receive ACG in 2nd Year. Pell Grant Recipient. Must have completed a rigorous course of study defined):

http://www.ed.gov/admins/finaid/about/ac-smart/state-programs06.html

Student’s self identify through FAFSA, Colleges are encouraged to identify students as working towards Core 40/Academic Honors diploma & then verify. (College may use SSACI Core 40 and Academic Honors data on SSACI’s data base for preliminary award purposes and also ask for a final high school grade transcript, including for second academic year awarding.)

ACG Eligibility Requirements In Indiana, students must have a Core 40 or Academic

Honors Diploma to qualify for ACG

1515

National Science and Mathematics Access to Retain Talent (SMART) Grant

Maximum eligibility $4,000 3rd and 4th year undergrad Bachelor’s degree program with a 3.0 GPA on a 4.0 scale. Statutory requirement that, to qualify as an eligible student for a

National SMART Grant, a student must major in one of the physical, life, or computer sciences, mathematics, technology, engineering, or a critical foreign language.

Pell Grant Recipient

16

T.E.A.C.H Grant

• Prepares students to teach in high-need field.

• Must teach 4 years at Title I School.

• Reverts to loan if requirements of grant are not met.

• School determines additional eligibility requirements.

• Not all schools participate.

16

1717

Federal Supplemental Education Opportunity Grant (FSEOG)

Students pursuing first bachelor’s or professional degree. Awarded first to students with exceptional “need”. Can be awarded to students attending less than full time. Annual award Maximums: $4,000.

Federal Work-study

Allows student to earn a set amount of dollars for their education. Eligible employers may be on/off campus (federal, state, or local public

agency.) Student usually awarded funding to work 15-20 hours per week. Studies

indicate workload does not negatively impact student’s grades. Schools must use a portion of funding offered for community service .

1818

Campus-based Programs

Supplemental Educational Opportunity Grant, Work Study, Perkins Loan

Federal government provides a defined amount of money to the college, the college determines the recipients and award amount.

Some colleges choose not to participate in the campus-based aid programs, so when comparing award letters among institution this point should be noted.

                                            

                              

19

Federal Loan Programs

19

2020

Federal Stafford Loans

Available under: Federal Family Education Loan Program (FFEL

Program) with funds provided by lender (e.g., bank or credit union.)*

William D. Ford Federal Direct Loan Program (Direct Loan Program) with funds provided directly by the federal government.

College determines in which program it participates. College determines loan eligibility and delivers loan

proceeds to the student.

*Legislation currently in US Congress to make all programs Direct Loan Programs and end FFEL Program.

2121

Federal Stafford Loans (Subsidized and Unsubsidized)

Subsidized Stafford: Must demonstrate need Cost of Attendance – EFC – other aid

Unsubsidized Stafford: “Need” is not a consideration. Base annual loan limits (combined subsidized

and unsubsidized.)$3,500 for 1st year undergrad$4,500 for 2nd year undergrad $5,500 for each remaining undergraduate yearStudents have the option to apply for an additional

unsubsidized loan of $2,000 Undergraduate Aggregate Loan Limits

$31,000 dependent student ($23,000 is subsidized)$57,500 independent student ($23,000 is subsidized)

2222

Additional Unsubsidized Stafford Loan

Additional unsubsidized loan eligibility for independent undergraduates, graduate students, and dependent students whose parents are unable to borrow under the PLUS Loan Program:

$4,000 per year for first and second years of undergraduate study

$5,000 per year for remaining years of undergraduate study

23

Federal Stafford Loan Interest Rates

2010 - 2011

Subsidized Loan – 4.5% fixed rate

Unsubsidized Loan – 6.8% fixed rate

23

2424

Repayment of Federal Stafford Loans

Six-month grace period. Maximum repayment period between 10 and

20 years depending on repayment plan chosen.

2525

Federal PLUS Loans

Borrowers are parents of dependent undergraduate students.

Annual loan limit: cost of attendance minus other aid

Interest rate for a FFELP loan is 8.5% fixed rate and the Interest rate for a Direct loan is 7.9% fixed rate

2626

Federal PLUS Loans

Repayment begins 60 days after loan is fully disbursed - i.e. after second semester disbursement

Deferment provisions; only principal is deferred, but interest may be capitalized

Credit check required – if not passed, undergraduate student may be able to borrow additional unsubsidized Stafford loan funds

2727

Other Government Resources

Veterans benefits ROTC scholarships and/or stipends Bureau of Indian Affairs (BIA) grants Health and Human Services loan and

scholarship programs State Divisions of Vocational Rehabilitation State grants, scholarships, loans, and work

programs (i.e. SSACI)

2828

Other Misc. Sources of Funds

College need-based and non-need based programs:

Academic, athletic, merit, other talent-based scholarships, and need-based grants.

Private/Civic business grants and scholarships.

Scholarships/awards which are not federal, state, or college funded must be reported to the Financial Aid Office at the college so that they may be included in the student’s financial aid package.

Alternative education loans

IRS – federal tax income credits (tax credits offer dollar-for-dollar reduction in tax liability for education expenses (Hope Tax Credit – first and second year up to $1500 per student; and Lifetime Learning Tax Credit – tax benefit to 20% of tuition expenses up to $10,000.)

2929

Federal Perkins Loan

Priority to students who show exceptional need. Maximum annual loan

$5,500 undergraduate students/$27,500 maximum Revolving loan fund – amount college has to lend

depends upon repayments received – very little capital contribution from the feds each year.

Interest rate: 5%

Nine-month grace period.

Repayment period may be up to 10 years.

Deferment and cancellation provisions available.

3030

FREE APPLICATION FOR FEDERAL STUDENT AID

2010-2011

FAFSA

The Color of the FAFSA is BLUE this year!

3131

FAFSA Application Requirements Submit the Free Application for Federal

Student Aid (FAFSA) prior to the college or state deadline, whichever is first (SSACI receipt date deadline to the federal processor on or before 3/10/2010.)

To ensure maximum consideration for federal, state, and college aid, check with each school to determine:

+ Required application materials

+ Application deadlines

3232

Free Application for Federal Student Aid (FAFSA)

Provides a snapshot of the family’s personal and financial information (number in household, number in college, income and assets to determine financial strength.)

Federal Methodology is applied to calculate Expected Family Contribution (EFC).

EFC = Parent Contribution (PC) + Student Contribution (SC)

May file the FAFSA in one of two ways

Paper FAFSA: PDF can be downloaded from www.fafsa.ed.gov and mailed in.

FAFSA on the Web (FOTW) at www.fafsa.ed.gov. Parents and students must get a PIN at www.pin.ed.gov prior to completing FAFSA on the Web. Helps to complete pre-application worksheet as well.

3333

To File FAFSA On The Web (FOTW)www.fafsa.ed.gov

(NOT fafsa.com)

FIRST REGISTER FOR A PIN at www.pin.ed.gov The PIN number is available immediately. You may self select a number. You use the PIN number for all federal resources.

If the student is dependent for financial aid purposes: BOTH student and parent must each apply for their own pin number .

34

• Good reasons to file electronically:• Built-in edits to prevent costly errors• Skip-logic allows student and/or parent to skip

unnecessary questions• More timely submission of original application and any

necessary corrections• More detailed instructions and “help” for common

questions• Ability to check application status on-line• Simplified application process in the future

35

IRS Data Retrieval•While completing FOTW, applicant may submit real-time request to IRS for tax data•IRS will authenticate taxpayer’s identity•If match found, IRS sends real-time results to applicant in new window•Applicant chooses whether or not to transfer data to FOTW•Participation is voluntary

36

FAFSA on the Web Worksheet

Page 1

General

instructions

37

FAFSA on the Web Worksheet

Section 1 has questions about student citizenship, marital status, selective service registration, and parents education level attained

Section 2 are 13 questionsthat determine whether student is Independent or depedent includingAge, pursuing graduate work, Married, have dependents, etc

38

FAFSA on the Web Worksheet

Section 3 Parent information are questions regarding parent income and assets from the 2009 tax year. Parent child lives with or is supported by 50% or more (and that parent’s spouse if remarried) must complete parent information section of FAFSA.

39

FAFSA on the Web Worksheet

Section 4 Student Information collects data on student assets and income. All students complete this section. However, the state does not use this data when calculating state aid eligibility unless student is Independent.

4040

Frequent FAFSA Information Errors

Name does not match Soc Sec card. Questions that should be complete but are left blank,

if unsure put zero “0”. Divorced/remarried parent information (conflict in

marital status & income reported.) Fail to include income earned by

parents/stepparents. Fail to include untaxed income. Reporting amount of taxes withheld rather than

amount actually paid. Household size

4141

FAFSA TIPS!

If filing electronically, don’t just save the data….click SUBMIT! The information on the FASFA should be re-checked before the FASFA is submitted as there are common and possible costly mistakes made each year (i.e. the question concerning residency is a critical criteria for the state grant and is often where an error is made on the FAFSA.)

Check for your e-mail confirmation to ensure your information was received and processed.

The student will receive and should review the Student Aid Report (SAR).

Make sure any discrepancies, errors, and updates needing to be made on the FAFSA data is resolved with the federal processor by the state deadline of May 15, 2010 as well as the deadlines the school may have!

Anytime you update or change your FAFSA please visit www.ssaci.in.gov/estudent (state receives changes 48-72 hours after you make them) to see if you have created any additional issues that need to be resolved.

4242

FAFSA Corrections

If a correction to FAFSA data is needed, corrections are made:

* The quickest way = On-line (PIN(s) required) If

dependent student, BOTH parent and student

need to have a PIN number to electronically

sign for changes to the FAFSA.

* Paper SAR-mail back to federal processor-be sure BOTH parent (if dependent) and student sign the SAR.

* By the college- but they are not required to provide this service.

4343

FAFSA Application Goes Through Database Matches After Submission To The Federal

Processor

Social Security Administration Immigration and Naturalization Services Selective Service System National Student Loan Data System If FAFSA does not pass a database match, it will cause

delays in processing (federal, state, and institutional) aid funds.

4444

4545

Principles of Need Analysis

To the extent they are able, parents have primary responsibility to pay for their dependent children’s education.

Students also have a responsibility to contribute to their educational costs.

Families should be evaluated in their present financial condition (verifiable prior year tax info, net worth of current assets.)

A family’s ability to pay for educational costs must be evaluated in an equitable and consistent manner, recognizing that special circumstances can and do affect its ability to pay.

4646

Definition of “Need”Cost of Attendance (COA)

* Tuition and fees * Room and Board * Books and Supplies* Transportation * Misc. Personal Expenses * Loan Fees* Dependent Care Expenses* Expenses Related to a Disability

– Expected Family Contribution (EFC)

= Financial Need

4747

EFC for Dependent Student

Step 1: Determine available parental incomeStep 2: Determine available parental assetsStep 3: Add 1 + 2 = Parental income and assets available for education expenses

Step 4: Determine available student incomeStep 5: Determine available student assetsStep 6: Add 4 + 5 = Student portion of available income and

assets available for education expenses

Step 1 + 2 = 3 Step 4 + 5 = 6

Step 3 + 6 = EFC

4848

EFC for Independent Student

No parental contribution Independent with dependents or Independent with no

dependents other than spouse have a lower contribution expectation (with Independent with dependents being the lowest) out of their income and assets then that of a dependent student.

4949

What is Professional Judgment?

The authority provided by the federal government under the Higher Education Act for aid administrators to exercise discretion (Professional Judgment) in specific areas of student aid administration on a case by case basis.

Examples of special circumstances may be: Loss of a custodial parent through death or divorce, unemployment, disaster, extreme out of pocket medical expenses. Student should contact the financial aid administrator at

the college they plan to attend

5050

Verification The effectiveness of the federal student financial aid programs depends on the accuracy of data students report on the FAFSA. Therefore schools must verify data provided if the student is selected by Central Processing System (CPS) or if the school selects the student for verification and must resolve conflicting information.

Only 30% of students are picked for verification. The school could have a policy to allows to verify more.

Verification Documents Include: Signed copies of student and parent federal tax return A Verification Worksheet provided by the college to the student to

complete/return. Any other financial or child support documentation requested by the

college.

5151

Financial Aid Packaging

5252

Packaging Objectives Finding the best combination of aid to meet a

student’s financial need given limited resources and constraints.

Distribute resources fairly and equitably. Set realistic self-help expectations. Offer relevant work experience. Recruit students*

*Although some colleges may use a generous Financial Aid Package to attract/recruit students, many colleges do not package students who have not completed the admission process. Some colleges will provide prospective students an estimate of aid if asked.

5353

Considerations in Packaging

Type and amount of funds available Institutional priorities Length of academic year Cost of attendance Community service Programs requirements Student’s year in school Academic major Availability of other resources Debt level of students Family financial strength Enrollment for multiple start dates

5454

Construction of the Financial Aid Package

Generally speaking, a college will construct a financial aid package in this order: 1st: gift aid from the federal and state programs

for which a student is eligible; 2nd: college and/or private donor gift aid (can

include non-need based aid); and 3rd: self-help programs (loan and work) are

added last. But, each college will have its own packaging

philosophy, subject to aid program regulations and availability of funds

5555

No Matter How Good The Financial Aid Package…..

If a “full-ride” package is presented to a student for a college which is not a good personal fit or does not offer the academic programs in which the student is interested, the “economics” at play may lead the student to accept that package and enroll at the college anyway.

An unhappy student is not likely to complete

the term and that is time and money that can not be recovered.

56

College Goal Sunday

College Goal Sunday will be on Sunday, February 21, 2010 from 2 - 4 p.m.

There were 37 sites throughout the state in 2010 where financial aid professionals help families complete the FASFA.

More Information - including site locations - can be found at the College Goal Sunday website in 01/01/2010: http://www.collegegoalsunday.org )

57

58

59

60

61

62

63

64

65

66

67