Important Financial Aid Regulations that Impact SFCC Students
On July 6, 2012, the Moving Ahead for Progress in the 21st Century Act was enacted. A new provision was added to the direct loan statutory requirements that limit a first time borrower’s eligibility for direct subsidized loans to a period not to exceed 150% of the length of the borrower’s educational program. Under certain conditions, the provision also causes first time borrowers who have exceeded the 150% limit to lose the interest subsidy on their direct subsidized loans. Only first time borrowers on or after July 1, 2013 are subject to the new provision.
- A first time borrower is defined as a student who has no outstanding balance of principal or interest on a direct loan or FFEL loan on July 1, 2013 or on the date the borrower obtains a direct loan after July 1, 2013.
- Student’s maximum time to receive direct subsidized loans is established based on the length of the program in which the student is currently enrolled. For example, a student declared in a two year program has three years to complete the program before reaching the 150% maximum time to receive direct subsidized loans.
- If a student reaches the 150% time limit the student loses interest subsidy and is responsible for future accruing interest during periods of at least half-time enrollment; grace period; deferment periods; and certain periods when repaying under Pay as You Earn or Income-Based Repayment Plans. Lost interest subsidy on a loan cannot be regained.
Note: The 150% provision for subsidized loans is different from the 150% Maximum Timeframe that is part of Satisfactory Academic Progress.
Lifetime Pell Eligibility Limit:
- Students will be limited to receiving a Pell grant for the full-time equivalent of 12 semesters. This is a lifetime maximum that cannot be exceeded regardless of the time it takes or how many schools you attend. The maximum is a full-time equivalent, so if you only received Pell grants as a half-time student, you would have 24 semesters of eligibility (16 at three-quarter-time). The calculation includes all earlier years of the student’s receipt of Pell. Students who are over this maximum and students who are approaching this maximum will receive letters from the Department of Education after they apply for Financial Aid. Once you reach this maximum, you are permanently denied Pell grant eligibility. This determination cannot be appealed for any reason.
Ability to Benefit:
- All students applying for Federal Student Aid must have a high school diploma or GED. In the past, students could take a test (at SFCC this was primarily the Accuplacer) that could allow them to receive aid despite not having a diploma or GED. Only students who had been eligible under the old provision will remain eligible.
Student Loan Interest Subsidy:
- The Federal government has done away with the student loan interest rate subsidy during a student’s grace period. In the past, students who had received subsidized student loans and graduated or dropped below half-time had a six-month grace period during which the government subsidized (paid) the monthly interest on the students behalf. Now the government does not pay the interest during this six-month grace period, and it will accrue to the student. The student’s first principal payment will not be due until the end of the six-month grace period (as in the past).
All of these regulations are the result of Congress changing the law that governs federal student aid. They can be changed again at any time. Please contact the financial aid office by email at email@example.com for clarification.
To E-mail Financial Aid:
Federal regulations require that all financial aid inquiries come from your school e-mail address. Please e-mail all financial aid questions from your SFCC email account and include your student A number. Log into JACK,access email account in upper right hand corner, and create a new email using “firstname.lastname@example.org” in the address bar.
For more information please contact the Financial Aid office, 505-428-1268.