FAFSA Form & Financial Aid Form Blog

Via NASFAA:

As amended by the Senate, HR 5175 makes the following changes::

* Directs all savings generated by the bill into the ACG and SMART Grant programs

* Adds a fifth year to SMART Grant eligibility for programs that require five years

* Allows students attending at least half time to qualify for ACG and SMART Grants and requires proration based on Pell Grant methodology for less than full-time attendance

* Allows eligible non-citizens (e.g. permanent residents) to qualify for ACG and SMART Grants

* Changes “academic year” to simply “year” for purposes of progression through grant levels, but did not include companion amendment recommended by NASFAA that would have allowed students who are classified as second year based solely on AP or IB coursework to be considered to have met the second year 3.0 GPA requirement

* Allows students who are enrolled in an institution that offers a single baccalaureate-level liberal arts curriculum that permits no subject area major, but who are taking coursework in an area equivalent to a SMART-eligible major at other bachelor degree-granting institutions, to qualify for SMART Grant eligibility

* Extends first-year ACG eligibility to students enrolled in at least a one-year certificate program and extends second-year ACG to students enrolled in at least a two-year certificate program. In both cases the certificate must be offered by a degree-granting institution

* Appears to remove some of the Secretary’s authority to define “rigorous secondary school program of study,” permitting only states to designate such programs. This amendment may further restrict what is currently considered a rigorous program

To celebrate our 10th anniversary, the Student Loan Network is giving away a $10,000 scholarship! Enter to win our drawing at:

and then start participating in Scholarship Points.

Who can win?

Any college student or graduate student attending school in 2008. Money will be paid directly to the financial aid office, and the contest ends on Leap Day, February 29, 2008.

Did

you

know

that…

if you have been convicted of possession or sale of an illegal substance during a period of enrollment…you will not be eligible for Federal student aid, including Federal student loans? In some cases, even if you have been convicted in the past of sale or possession of an illegal substance, you may not be eligible for federal aid in the future. Students at Truman State University, in Missouri, are able to voice their opinions on the subject mostly due a national campaign run by the Students for Sensible Drug Policy (SSDP). In an article written by Heather Turner, she explains why this topic is up for debate:

“In July the Senate passed the Higher Education Access Act of 2007, which expands funding for federal aid, with the question still on the FAFSA form, according to Library of Congress Records. SSDP members hope to convince enough members of the House of Representatives to keep the question off of the FAFSA form before the bill is passed sometime in October or November. Richardson said he thinks there is a good chance the question will be removed because the House drafted an earlier version of the bill that did not include the amendment containing the question.”We’re hoping there’s a good chance that it will go through the House without the question, and then when it comes to the committee that decides on the final bill, they’ll end up siding with the House version,” Richardson said.Rep. Rebecca McClanahan, D-Kirksville, said she is open to discuss the issue with students, even though she is not involved directly with the legislation.”I’ve been concerned about some of the enforcement of very minor offenses that sometimes appear to be overblown when we could be using our energies on things that are more of a problem,” McClanahan said.She said her experiences working as a nurse with individuals who had substance abuse disorders has given her a broad understanding of the issue.”[The question] doesn’t even speak to the issue that a person that’s even addicted has perhaps gone through treatment and has achieved sobriety after a significant addiction,” McClanahan said. “I assumed that would still apply to them, which seems like an unfair restriction when a person is doing well.”Ryan, a former Truman student who asked for his last name to be withheld, was found to be in possession of marijuana on campus his freshman year at Truman. He said there still are ways to find funding to cover education costs. Ryan said he has been able to keep his scholarships and would have been able to keep the scholarships offered to him through the University by completing a program that included writing a paper and attending meetings, had he not opted to go to another college.

“I honestly think Truman has the right idea with the writing of the paper, and I had to go to a counseling meeting, like a group counseling session,” Ryan said.

Completing a drug rehabilitation program like the one Truman requires after a student commits a drug offense involving illegal substances is part of the criteria for regaining eligibility for federal aid, according to an amendment in title IV of the Higher Education Act that went into effect in 2000.

“The scholarship that I have kept four years now is A+, and drug offenses are not, I guess, considered a reason to lose it,” Ryan said.

Ryan has not had to file for federal aid to cover his college expenses but said that even though he understands where the government is coming from, it seems like it violates personal rights to ask whether or not students have been convicted of a drug offense.

“I think that it should be evaluated on a case-by-case basis for repeat offenders perhaps,” Ryan said. “I don’t think on a first time basis you should lose your scholarships or federal money.”

Data the national SSDP chapter received through the Department of Education shows that more than 189,000 applicants have been disqualified nationally since the question was added to the FAFSA form in 2000 because of their responses, including about 2,800 applicants in Missouri.”

What do you guys think?

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For the full article quoted above click here

Loophole Could Increase Some Students’ Eligibility for Financial Aid

By KARIN FISCHER

Under a little-noticed loophole in a new federal law, money set aside in college-savings plans will not be counted in determining a dependent student’s eligibility for need-based financial aid if the account is in the student’s name, according to guidance released last week by the U.S. Department of Education.

The loophole — created by Congress in February when it passed deficit-reduction legislation — is reflected in a proposed revision of the Free Application for Federal Student Aid, or Fafsa, which the U.S. Department of Education published last Tuesday in the Federal Register.

The Fafsa is the standard application form that the federal government, state governments, and most colleges use to determine a student’s eligibility for financial aid.

In the draft revision of the Fafsa, instructions direct applicants to report the value of assets in college-savings plans and other education accounts owned by their parents. But, the instructions state, “Do not report the value of these accounts if the student is the owner.”

It is unclear how many families the change could affect, said Joseph F. Hurley, an accountant who tracks the plans for his Web site, Savingforcollege.com. While New York State does allow parents to act as custodian of a dependent student’s plan, many states do not permit accounts to be opened in a minor’s name.

There is also some confusion about whether Congress meant to create the potential loophole or whether it arose from a legislative drafting error. “I’m not sure how many people who are rushing out to open plans because there is some skepticism that’s what was intended,” Mr. Hurley said. Still, he added, “on an individual basis, this certainly could be a substantial benefit.”

Under previous law, money placed in college-savings plans, even under a student’s name, could shrink a student’s financial-aid award, although the size of the reduction depended on factors such as family income and the cost of attending a particular institution.

The Education Department is seeking comment on the revised Fafsa through August 7.

Investors have opened about 8.6-million college-savings accounts, with a total value of more than $89.46-billion, according to the College Savings Plan Network, the association that represents state-run college-savings plans. All 50 states and Washington, D.C., now offer the plans.

Pace University’s Pace Press did a very nice article summarizing the FAFSA from our FAFSAonline.com site - thanks, Jackie Berg, for a great article. Stay tuned as we deconstruct the IRS 1040 coming soon. Promise.

Their article:

PacePress Article