If you’re getting
financial aid in college, chances are good that at least some of it is coming in the form of federal financial aid programs. With so many different grant and loan programs, the federal government provides the lion’s share of financial aid to students: 75% of it, in fact. So whether you’re thinking about school or already in it, you’re probably going to have to deal with federal financial aid at some point. But as with all things government, there are many intricacies that you may not know about, like eligibility, special grants, and even limits on how much you can get. Read on, and we’ll enlighten you with 14 surprising facts about federal financial aid programs.
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The average student graduates with $24,000 worth of debt, with an average cost of $16,140 for public four-year universities, and $36,993 for private schools. But federal Stafford Loans are capped out at $18,500 total. This amount is designed to completely cover tuition and fees, but for some students, this cap means that they can’t get enough student loan money to cover the entire cost of college. If you anticipate that your college experience will go beyond this level, you may need to look into private loans, parent loans, and other sources of school funding like work study programs, scholarships, and grants.
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For the most part, students can expect to not have to worry about student loan payments until they have graduated. This is by design, as after graduation, it’s assumed that you’ll be able to get a job to pay your student loan bills. However, repayment terms may be different in some cases. If for some reason you leave school without graduating, whether you drop out or take a break, you will be required to start paying for your student loans. Additionally, if you drop below half time enrollment, you will have to start paying. For students who plan to be continually enrolled in full time curriculum, this is not an issue, but for those who are following an alternative schedule, it’s important to know the rules and be prepared to pay.
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Not all federal student loans are created equally. Some charge interest from the very beginning, while others do not, only starting to charge interest while you’re enrolled in school full time. Obviously, if you’re going the loan route, you’ll want to utilize the non-interest loans as much as possible. Fortunately, qualifying for non-interest, or subsidized loans, is a simple process. All you have to do is fill out the Free Application for Federal Student Aid (FAFSA) to determine the amount you can qualify to borrow under subsidized loans.
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In a disaster situation, you may have lost your home, car, and other important possessions. The last thing you are probably worrying about is making payments on your student loan, and guess what? The government agrees with you. Federal Student Aid offers forbearance to students who are in repayment but were adversely affected by disaster. If you’re a victim of natural disaster and are having trouble making payments on your student loan, you can contact your lender and request a forbearance, which will allow you to have your payments postponed or reduced for up to three months. Although this is a convenient way to help with your finances during a disaster, it’s important to remember that interest will still be charged during this period.
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Disaster-affected students aren’t the only ones who can catch a break. Students affected by the conflicts in Iraq and Afghanistan may qualify for assistance as well. Under the Iraq and Afghanistan Service Grant, students who have lost a parent or guardian as a result of military service in Iraq or Afghanistan after 9/11 may qualify for up to $5,550 in funds for school. To qualify, students must be ineligible for a Federal Pell Grant, and must have been less than 24 years old or enrolled at least part time at a higher education institution at the time of death.
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Sometimes, graduate students seem to get the short end of the stick when it comes to financial aid. So much is geared toward undergrads that graduate students may feel like their mounting financial needs are not being met. However, in 2005, graduate students caught a break with the Higher Education Reconciliation Act. In this act, PLUS loans were made available to graduate students. PLUS loans are loans that are made available to parents in order to fill the gap between the financial aid received by the student, and the actual cost of attendance.
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This may not necessarily be surprising, but it’s an intricacy that’s worth pointing out: if you’re an undocumented student, you’re not going to get any federal financial aid. Although enrollment in public K-12 schools is free for everyone, the ride ends at high school graduation, and financial aid is not available for undocumented students and illegal aliens attending college. However, undocumented students can receive scholarships as well as financial aid at the state and college level. Additionally, several states offer in-state tuition for resident undocumented students.
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Federal student aid is great, but it doesn’t come free, at least if you’re a male student. The draft was discontinued in 1973, with the US moving to an all-volunteer military force. However, the Selective Service does still exist as a contingency plan, and most college students are within the ages (18-25) of required registration. Of course, this registration is not unique to financial aid, as young men are required to be registered regardless of college or financial aid status. However, your registration must be confirmed before you can receive Federal Student Aid.
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Let’s face it: recreational drug use happens in college, and even in high school. And although some campuses offer lenient drug rules, racking up a drug violation can have serious consequences on your financial aid situation. After receiving a conviction, you will go through a period of ineligibility for FSA funds. The shortest period is 1 year from the date of conviction for a first offense possession of illegal drugs, however, things get more serious for 3 or more possession offenses and for those who have been convicted of selling illegal drugs. These higher offenses are subject to interpretation, with “indefinite periods” of loss of ineligibility. Even one year of lost financial aid can be devastating to a student, resulting in missed school and/or thousands in tuition and fees that must be paid.
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Criticize the government all you want, sometimes they do things that really make sense. For example, the TEACH Grant program. You need money for school, while the US needs good teachers in low income areas. With the TEACH Grant program, both of these needs are met, as students can receive up to $4,000 for school each year if they intend to teach in a school that serves students from low-income families. It’s not exactly a light commitment, as the program requires at least four academic years of service, but for students who could use the money, it can make an incredible difference, with up to $16,000 for school. If you go to the right college, this grant alone can pay for your entire education, so if you’re willing to put in the service time, the TEACH grant is a great option.
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Loan administrators really want to make sure you understand what happens when it’s actually time to start paying on your student loans. It’s not just, “thanks for the money, I’ve got my diploma now, see ya!” You’ll have to pay, and exit counseling ensures that you understand exactly how that’s going to happen. The session is fairly straightforward and simple, explaining your rights and responsibilities in loan repayment. Because unfortunately, you do actually have to repay your loans, and for some, that’s a commitment of 10 years or even more.
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You don’t have to be a full-time student to benefit from federal financial aid. As so many students juggle commitments of work, school, and even family, part time studies may be necessary, but for most situations, part-time status will not affect your financial aid availability. In fact, as long as you’re enrolled in at least six credits each term (that’s usually just two classes), you can receive Pell grants, Federal Direct Stafford loans, and more. Students with at least half-time enrollment (six or more hours) have almost the same financial aid availability. However, Perkins loans are only available to full time students, and grants like the Federal Supplemental Educational Opportunity Grant require full time enrollment for awards in fall and spring semesters.
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Plenty of emphasis is placed on financial aid in the form of scholarships and federal loans, but grants make up a huge piece of the federal financial aid pie. Grants are especially valuable, as they are literally free money, as opposed to loans that you may have to pay back. Of course, some may come with strings attached, like the TEACH grant that requires four years of teaching service, but you can’t beat free cash for school in hand. With this in mind, it’s not all that surprising to find out that in 2007-2008, 66% of undergraduates received financial aid, and 52% of total applicants received grants, with an average of $4,900.
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Perhaps the most surprising fact about federal financial aid is that you may not even need to use it. It’s not a dream: tuition-free colleges do actually exist, offering full-tuition scholarships and sometimes even free room and board. Of course, these schools are hard to get into, and you’ll have to be a top performer to qualify. You also may be required to participate heavily in work-study programs, but the bottom line is that free college is an incredible gift worth investigating and working for.
Taken From
Online Colleges
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