For students who will be entering college in the Fall of 2008, the Free Application for Federal Student Aid (FAFSA) should not be filled out till after December 31, 2007. The information in the FAFSA form will be based on the 2007 tax year.

Eligibility for federal student aid is determined based on financial need and several other factors. To receive federal aid, you must:
> Have financial need
> Have a high school diploma, a GED certificate, or complete a high school home school program as provided under state law.
> Be enrolled or accepted for enrollment as a regular student working toward a degree or certificate in an eligible program.
> Be a U.S. Citizen or eligible non-citizen
> Have a valid Social Security Number
> Make satisfactory academic progress
> Use federal aid only for educational purposes
> Males must comply with Selective Service registration

Mrs. Ross will get small bits of Financial Aid information to you from now till January 29, 2008. January 29 will be our Financial Aid Night. We will begin at 6:30 PM in the lecture hall. VR’s second Financial Aid Night will be February 26 in the Library. We will use the computers and actually work on the applications. Stacie Flood from ACC will be our speaker at both sessions. Remember -- EVERYONE SHOULD APPLY!! IT’S FREE!! IT IS A SAFEGUARD!!

The first Financial Aid Blurb dealt with eligibility. Now, I want to talk about Dependency Status. Many people are under the false pretense that if they don't claim their child on their income tax that the student will be independent and qualify for more aid. Claiming students on your income tax has nothing to do with dependency status. The Feds will look at the following criteria and if you can answer yes to any of them you would be considered independent.

1. You (the student) were born before January 1, 1985
2. You are married
3. You're enrolled in a graduate or professional educational program (beyond a bachelor's degree)
4. You have legal dependants other than a spouse
5. You are an orphan or ward of the court (or were a ward of the court until age 18)
6. You are a U.S. Armed Forces veteran

Independent students report only their financial information (and spouse's if married). Special circumstances can arise. If you feel you have a special circumstance, talk to the college's financial aid office about changing the dependency status. A parent's refusal to provide financial assistance or the required FAFSA information is not a valid reason for changing dependency.

Dependent students are required to report both their income and their parent’s income.

The large majority of our students will be dependent students.

APPLYING FOR AID
First remember that you cannot apply for aid till after January 1st since it is based on the 2007 tax year. Remember too that colleges that receive your financial aid information will not work with it till the student has made application to the school. The application will be filed away until application is made. Now...

Step one: The student and one parent need to apply for a PIN number if you are using the online application for FAFSA. You can visit www.fafsa.ed.gov. On the first page there are three large numbers. Click on number "1". This will link you to the site where you will obtain your PIN number. You can go directly to site using pin.ed.gov. Your pin allows you to:
1. Apply online
2. Sign your application electronically
3. Make online corrections to your FAFSA (saving much time)
4. Access your Student Aid Report (SAR)
5. "Sign" a master promissory note for a federal loan (very convenient)

The PIN is not the same as the FAFSA and can be applied for right now. DO NOT LOSE THIS PIN NUMBER!!! You will use this PIN number every year till you finish college. You might want to put the student and parent's PIN in the same place.

Student Loans

Most colleges will package student loans into their awards. While none of us like loans, it has become a necessary part of most students' education. Today I will explain some general knowledge on loans and in the future, I will explain about some of the various loans available to our students.

The main category of loans is Federal Loans. Financial aid departments will determine if you qualify for these loans and how much but they do not make the loan. If a student loan is listed on your award letter, it is still your responsibility to apply for the loan. Ask the school where you applying for their preferred lender list. It will be your responsibility to find who has the best interest rates and turn around time. You will want good turn around time because you don't want to be waiting for your loan if you have already started school. Probably your home bank handles student loans. Check with them on interest rates and turn around time. In the end it is up to you where you want to apply. Whatever lending institution you use will send the money to the school to be disbursed.

The second class of loans are private loans. These are available from banks, schools, and educational loan orginizations. Some private loan lenders are:
CHASE - www.chasestudentloans.com
Nellie Mae - www.nelliemae.com
Sallie Mae - www.salliemae.com
Student Loan Funding - www.studentloanfunding.com

Also check with your home bank about private student loan programs that they might have.

I would like to cover a few of the most used student loans.

Federal Perkins Loan Program
Students who have a very low EFC (Expected Family Contribution) or have an exceptional need can apply for this loan. Perkins Loans are made through the school's financail aid office. The school is the lender and the loan is made with government funds. The loan will be divided equally over two semesters. Some schools pay by check other schools will apply the loan to the student's account. You can borrow $4000 per year with a cap of $20,000 for an undergraduate degree (otherwise you can receive it for five years). The amount you receive depends on when you apply, your financial need, and the funding available to the school. Repayment begins nine months after you graduate, leave school, or drop below half-time status.

Federal Stafford Loans
This is a low interest loan to help cover educational expenses. These loans are available through:

>Federal Family Education Loan Program (FFELP)
>Federal Direct Loan Programs

Schools generally participate in one or the other but there are some schools that participate in both. In the Direct Loan Program, the loan funds come directly from the federal government to the school. Under the FFELP, the loan funds come from a bank, credit union, or other lender that participates in the program. Rules and loan amounts are identical for each program. Most schools in our area use the FFELP.

There are two types of Stafford Loans: Subsidized and Unsubsidized.
Subsidized Stafford loan is for students who have demonstrated financial need (remember "need" can vary from school to school). With the subsidized loan, the federal government pays the interest on the loan while the student is in school.
Unsubsidized Stafford loan is for students who do not qualify for a Subsidized Stafford loan or need more money than the subsidized program can offer. You may qualify for this loan regardless of your family income. The student is responsible for the interest on the loan while they are in school. Most lending institutions will defer the interest payment and let you add it to the principal at the end of the loan.

Repayment doesn't begin until six months after a student graduates and they have up to ten years to repay the debt.

The limit for incoming freshman on each of these loans is $3500. The amount will increase to $4500 for the sophomore year and $5500 for the junior and senior year.



PLUS LOANS

The next loan is one of the more popular loans for middle income families. While most other loans are made directly to the student, the PLUS loan is made to the parents of the student. Students must be enrolled at least half time. Parents may borrow up to the full cost of the student's education each academic year, minus grants, and other financial aid. Parents do not have to prove financial need. This loan is based on the parents credit. The PLUS loans are low interest with a cap of 9%. Repayment starts within 60 days after final disbursement of the loan. Parents may postpone repayment for up to 60 months, including while your student is in school.

MILITARY HELP FOR LOAN REPAYMENT

The Armed Forces have a program called Student Loan Repayment Program (SLRP). Qualified students enlisting in the Army or Navy can receive up to $65,000 to repay qualified student loans. A student enlisting in the Reserve can receive up to $20,000 and a student enlisting in the Air Force can receive up to $10,000. The participants must score 50 or higher on the Armed Forces Qualifications Test (AFQT). SLRP must be requested at the time of enlistment or re-enlistment.