1. 1 OCAN Advisor Training, August 10, 2011 Lawrence Matthews Director of Financial Aid Bluffton University matthewsL@bluffton.edu Financial Aid 101 Jeff Johnston Senior Account Executive Sallie Mae jeff.johnston@salliemae.com

2. 2 Information: financial aid process  The Key to obtaining Financial Aid is understanding how the system works. Introduction to training NCAN’s Advisor Training Module (ATM) – Chapter 7, The Guide to Federal Student Aid, PowerPoint and handouts

3. 3 OASFAA Disclaimer The Ohio Association of Student Financial Aid Administrators (OASFAA) is a non-profit organization and provides the following information as a free service to access staff and high school counselors. Access staff and high school counselors have permission to copy and distribute these materials to their students and families. Charges may not be assessed for the material or for the information presented. Permission must be granted for other use of this information or these materials. Contact the Outreach Chairperson listed on the OASFAA web site or e-mail:outreach@oasfaa.org

4. 4 What is Financial Aid?  Scholarships  Grants  Loans  Employment opportunities Purpose is to provide: Choice and Access NCAN ATM, pg 4

5. 5 Categories of Aid  Merit-based - Scholarships (performance)  Need-based - Grants - Loans - Work-study jobs  Non-Need Based Aid - Loans

6. 6 u To the extent they are able, Parents have the primary responsibility to pay for their dependent child’s education. Students also have a responsibility to contribute to their educational costs. u Families should be evaluated in their present financial condition. u 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 a family’s ability to pay. Principles of Need Analysis NCAN ATM, pg 2

7. 7 Cost of Attendance - Expected Family Contribution (EFC) = Eligibility Tuition and fees Room and Board Books, supplies, Personal, travel Financial Aid Need Definition of Need The Guide pg.12; ATM pg.2 Student’s + Parent’s Contribution Because most federal student aid funds are limited, the total amount awarded to you might fall short of the amount for which you are eligible. FSA Guide, 07-08

8. 8 Expected Family Contribution u “The EFC is calculated according to a formula established by law.” The Guide pg.12 The formula does not measure willingness to pay! “ The questions on the FAFSA are required to calculate your Expected Family Contribution (EFC). The EFC measures your family’s financial strength and determines your eligibility for federal student aid. ” from FAFSA paper instructions, 2011-2012, pg. 10 “The EFC is not the amount of money that your family must provide. Rather, you should think of the EFC as an index that colleges use to determine how much financial aid you would receive if you were to attend their school.” FAFSA4Caster

9. 99  Increased income protection allowance for dependent students: 06-07$2,550 07-08$3,000 (HERA) 08-09$3,080 09-10 $3,750 (CCRAA) 10-11$4,500 11-12$5,250 12-13$6,000 Higher Education Reconciliation Act of 2005 (HERA) College Cost Reduction and Access Act of 2007 (CCRAA) Asset conversion rate for dependent students is 20%

10. 10 Need Comparison Higher Cost Mid Cost Lower Cost Institution Institution Institution Cost of Attendance $40,000 $28,000 $13,000 - EFC $8,000 $ 8,000 $ 8,000 = Need / Eligibility $32,000 $20,000 $ 5,000 The Federal Expected Family Contribution (EFC) is the same at each institution. Handout: Cost comparison worksheet

11. 11 How/When to file if dealing with early deadlines:  Use a completed tax return if possible Or follow a two-step process (The Guide pg 25, ATM pg 33): Step 1: Apply and estimate your tax information on your application Step 2: Make corrections later if your income or tax information was not accurate. Handout: FAFSA A Word about Deadlines They’re REAL

12. 12 FAFSA If you are supposed to file a 2010 federal income tax return, we recommend that you complete it before filling out this form. If you have not yet completed your 2010 tax return, you can still submit your FAFSA using best estimates. After you submit your tax return, correct any income or tax information that is different from what you initially submitted on your FAFSA. If you or your family has unusual circumstances (such as loss of employment), complete this form to the extent you can, then submit it as instructed and consult with the financial aid office at the college you plan to attend. Deadlines Unusual circumstances

13. 13 Special Circumstances The Guide, pg.13; NCAN ATM pg.41 Examples: reported to the financial aid office  Medical  Parent or student loss of income  Unusual debt or one-time income  Tuition expenses at an elementary or secondary school  Parent in College u The financial aid administrator must have compelling reasons to use professional judgment. u The financial aid administrator’s decision as to whether you have special circumstances is final and cannot be appealed to us (the Department of Education).

14. 14 Special Circumstances (cont’d) What about stepparent’s information?  Paper FAFSA, pg.9, column 2  The Guide, pg.29 What about dependency status?  The Guide, pg.27-28  NCAN ATM, pg.34  11-12 paper FAFSA, pgs.5,9

15. 15 Verification The Guide, pg.30  Selected by the Central Processing System (CPS) or the Institution  Keep copies of 2010 Tax documents (for 11-12 FAFSA)  If selected, completion is required before aid can be disbursed  Verification materials are sent from the student or family to the financial aid office, not to the federal processor

16. 16 Verification and IRS Data Retrieval ATM, pgs.27-29  Available now (11-12)  Can be used with initial filing of the FAFSA For 12-13 (ATM, pgs.28-29):  Can and should be used when filing the initial FAFSA, making corrections, or when changing estimated tax information to actual tax information

17. 17 FAFSA Worksheet Beginning about January 30, 2012 students and parents who have completed their 2011 IRS tax return will be able to use FAFSA on the Web to view the tax information needed to complete the FAFSA. There will also be an option to securely transfer the tax information to the FAFSA. FAFSA worksheet IRS Data Retrieval tool

18. 18 Providing IRS Data – IRS Data Retrieval Tool  Initial FAFSA  FAFSA Corrections  English and Spanish 18

19. 19 Providing Tax Information IRS provides FAFSA on the Web users with access to their tax information. Electronically filed tax return information will be available from the IRS in 1-2 weeks, data from paper tax returns will be available in 6-8 weeks. 19

20. 20 Basic Steps for First-Time Filers  Apply for admission.  Complete and transmit (or mail) the FAFSA, The Guide, pgs.25-27; ATM pg.31ff Two ways to file : 1) If you have access to the internet, you are encouraged to file electronically, or…

21. 21  10 page booklet containing: Instructions 103 questions organized into 7 steps If mailing your FAFSA to the processor: Make A Copy 2) File a Paper FAFSA  To check status: Call 1-800-433-3243 or www.fafsa.ed.gov –FAFSA follow-up: check status of a filed FAFSA

22. 22  Simplified options  Updated graphics  An updateable announcement section  Access to FAFSA PDF and paper FAFSA information 22 www.FAFSA.gov FOTW Homepage

23. 23 FAFSA Filing Options Provides the three options for applying including the PDF FAFSA. 23

24. 24 08-09 changes that were retained ATM pg.31 Real-Time PIN  Issued upon request (FOTW or PIN Site)  Valid for FAFSA unless subsequent SSA match fails Number of School Choices  Increased to ten on FOTW  Remains four on paper PDF FAFSA filing option at: www.federalstudentaid.ed.gov www.federalstudentaid.ed.gov  Print a paper version to complete, sign/date, and mail.

25. 25 A parent only needs one PIN to sign for multiple children The PIN, www.pin.ed.gov The Guide pg.26; ATM pgs. 31-32www.pin.ed.gov

26. 26 FOTW Homepage 26 FAFSA worksheet discussion

27. 27 …One Log-In for all Applicants 27

28. 28 Customized “My FAFSA” Page 28

29. 29 Customized “My FAFSA” Page 29

30. 30 Detailed College Info and Comparison College’s website School type Tuition and fees Net price average Graduation rates Retention rates Transfer rates 30

31. 31 “My FAFSA”– Processed FAFSA 31

32. 32  Complete and mail any supplemental forms required by the college or state agency. CSS PROFILE, ATM pg.38, State/Institutional/Access, ATM pg.45  Watch for your financial aid award letter or Financial Aid package from the college/university. Samples: ATM pgs.57ff  Apply for admission.  Complete the FAFSA after January 1.  Review your Student Aid Report (SAR). Update estimated information, make corrections or contact the Financial Aid Office if corrections needed. Basic Steps for First-Time Filers

33. 33 Scholarship Searches & SCAMS  Free Scholarship searches vs. searches for a fee: The Guide pg.22; ATM pgs.47ff  Identity Theft: The Guide pgs.22-23

34. 34 www.statevoucher.org

35. 35 Ohio College Opportunity Grant (OCOG)  Students must file the FAFSA, be Ohio residents and attend an Ohio Public or Private Institution  The Expected Family Contribution (EFC) is the index number for awarding OCOG  EFC eligibility range is from 0000-2190  A part-time student will receive a pro-rated award  Available for continuous enrollment (includes summer)  Other Ohio programs http://regents.ohio.gov/sgs/ 2011-2012

36. 36 Federal Pell / SEOG Grants  Pell Grant (2011-2012) EFC of 00000 = $5550 maximum EFC of 05273 = $ 555 minimum Pell *Need Based *Must file FAFSA *Portable  Federal SEOG Grant *Exceptional financial need *Lowest EFC’s (Pell Eligible students are priority) *Award ranges from $100 to $4000 Campus Based Handout: 2011-2012 FSA at a Glance Two Pells in One Award year was eliminated in the Department of Defense & Full-Year Continuing Appropriations Act of 2011, signed 4-15-11 (The Guide, pg.13)

37. 37 Federal Work-Study  Undergraduate or graduate students are eligible  Employment can be on or off campus  FWS wages excluded from EFC calculation!!!  Eligible employers School Federal, state, or local public agency Private non-profit organization in academically relevant jobs For-profit organization in academically relevant jobs Community service activities Campus Based Ohio minimum wage in 2011: $7.40 per hour

38. 38 Federal Perkins Loan  Eligible students (priority to exceptional need) Undergraduate or graduate students Must file the FAFSA  Annual and aggregate loan limits up to $5,500 annually for undergraduates (actual awards, if any, will vary between schools) $27,500 aggregate for undergraduates  Interest rate: 5% (fixed) during repayment  Interest subsidized during in-school and nine-month grace period  Deferment and cancellation provisions available Campus Based

39. 39 Federal Direct Loan Subsidized or Unsubsidized  Long-term loan; must be repaid (must file FAFSA) 10 year maximum repayment period –but additional repayment and forgiveness options may apply  Repayment begins 6 months after student graduates or drops below half-time enrollment status  Subsidized: Students with financial need (interest free during in- school and grace period) or, Unsubsidized: Eligible regardless of need (Student is responsible for interest during in-school and grace period)  Loan Limits:First year $3500 Second year $4500 Third or more years $5500  Additional $2000 per year will be offered in an unsubsidized loan.  Initial fees for 11-12 are 0.5% of amount listed above: 1% origination fee, minus.5% repayment rebate Budget Control Act of 2011 eliminated rebate for 12-13 and beyond

40. 40 Cost of Education (COA) - Expected Family Contribution (EFC) = Eligibility Financial Aid Need Definition of Need Unsubsidized Subsidized $2000 more in Unsubsidized

41. 41 Undergraduate Direct Loan interest rates – subsidized only (signed into law 9/27/07)  6.8% in repayment currently  6.0% for loans first disbursed after 7/1/08 for 2008-09  5.6% for loans first disbursed after 7/1/09 for 2009-10  4.5% for loans first disbursed after 7/1/10 for 2010-11  3.4% for loans first disbursed after 7/1/11 for 2011-12  6.8% for loans first disbursed after 7/1/12. Changing interest rates, but only for subsidized loans  An unsubsidized loan is at 6.8%  Graduate Direct Loan rates are at 6.8%; sub or unsub u Budget Control Act of 2011 eliminated subsidized loans for Graduate students effective for loans disbursed after July 1, 2012.

42. 42 Federal PLUS Loan  Borrowers are parents of dependent undergraduate students At time of application, could be denied if adverse credit Debt to income is not a consideration  Loan limits Annual limit = COA - FA (Student’s Financial Aid) Interest is fixed at 7.9%  4% origination fee with an upfront repayment rebate of 1.5% = 2.5% actual fee Rebate eliminated beginning in 2012-13.  Repayment begins 60 days after full disbursement

43. 43  File the FAFSA  Complete admission process at the school you plan to attend.  Review the award letter from the school to learn about eligibility.  Go to www.studentloans.govwww.studentloans.gov Sign in using your Federal PIN Student: complete entrance counseling AND MPN (Master Promissory Note). Parent: complete PLUS application AND MPN. How do I apply for Federal Direct Loans??

44. 44 Getting Help  Federal Student Aid Information Center (inside cover of The Guide): 1-800-433-3243  www.federalstudentaid.ed.gov www.federalstudentaid.ed.gov  Ohio’s College Access Information Hotline: 1-877-428-8246

45. 45 www.federalstudentaid.ed.gov

46. 46 www.fsa4counselors.ed.gov

47. 47 www.FinAid.org

48. 48 Training opportunities Visit www.oasfaa.org...www.oasfaa.org  For information on Counselor workshops to be held December 5-9, 2011: –Locations TBA OACAC Articulation Workshops:  September 12-15 www.oacac.org  Monday, September 12 – The Ohio State University Tuesday, September 13 – The University of Akron Wednesday, September 14 – Rhodes State/OSU-Lima Thursday, September 15 – Xavier University