Federal Regulations That May Affect Your Financial Aid
In late December, the Consolidated Appropriations Act of 2012 was signed into law. This legislation impacts federal financial aid programs and student eligibility for the academic year.
Pell Grant Eligibility
Some students who received the Pell grant in the past may no longer be eligible for the reasons below:
- The new law also reduces the duration of a student's Pell grant eligibility to a 12-semester lifetime limit. Students who have received Pell grant funds for the equivalent of 12 full-time semesters will not be eligible to receive this grant for future semesters. Full-time enrollment is defined as 12 or more credits per semester.
How will a student know if he/ she is nearing their lifetime limit? To determine remaining eligibility, the Department of Education (DOE) must review all Pell grants awarded since the program began. Beginning in mid-April, the DOE sent emails to all 2012-2013 FAFSA applicants who appear to be nearing their lifetime limit. Students applying for the 2013-2014 year will be notified of the percentage of Pell lifetime limit used/remaining on the Student Aid Report (the output document as a result of the FAFSA application).
Subsidized Loan Eligibility
On July 6, 2012, the Moving Ahead for Progress in the 21st Century Act (MAP-21) (Public Law 112-141) was enacted. MAP-21 added a new provision to the Direct Loan statutory requirements (see HEA section 455(q)) that limits a first-time borrower's eligibility for Direct Subsidized Loans to a period not to exceed 150 percent of the length of the borrower's educational program. Under certain conditions, the provision also causes first-time borrowers who have exceeded the 150 percent 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.
Federal regulations limit the number of times a student may repeat a course and receive financial aid for that course.
- A student may receive aid to repeat a previously passed course one additional time. Once a student has completed any course twice with a passing grade, he/she is no longer eligible to receive aid for that course.
- A student may receive aid when repeating a course that was previously failed, regardless of the number of times the course was attempted and failed.
- If a student retakes a course that is not aid eligible, a recalculation of aid is done to exclude the credits for the repeated course. If a balance is due after the recalculation, the student must make payment in order to retain the course.
- This rule applies whether or not the student received aid for earlier enrollments in the course.