The Office of Financial Aid would like to share with you a number of changes to student federal aid loans and grants for the 2015–2016 academic year.

Unusual Enrollment History Flag

Beginning with the 2015–2016 award year, the U.S. Department of Education will now be assigning the Unusual Enrollment History Flag to students with an unusual enrollment history regarding the receipt of either a Pell Grant and/or Federal Direct Loan funds (not including a Direct Consolidation Loan, Perkins Loan, or a parent PLUS loan). The U.S Department will also now be reviewing the past four award years instead of only the past three award years.

FSA ID/PIN Replacement

The FSA ID was implemented on May 10, 2015. The FSA ID replaces the Federal Student Aid PIN as the credential with which students, parents, and borrowers authenticate their identity to access their federal student aid information online and electronically sign Federal Student Aid documents. Information about the transition to the FSA ID is available at StudentAid.gov/fsaid. Below is a link to a one-page resource for students, parents, and borrowers. The guide explains the need for creating an FSA ID and describes how to create an FSA ID.

FSA ID/PIN Replacement - How to Create an FSA ID Guide in PDF Format, 2MB, 1 Page

Federal student loan interest rates will rise or fall. Prepare for changes on the interest rates of Direct subsidized, unsubsidized and PLUS loans

Direct Loan Interest Rates for 2015-2016

The chart below displays the resultant interest rates for Direct Subsidized Loans, Direct Unsubsidized Loans, and Direct PLUS Loans first disbursed on or after July 1, 2015 and before July 1, 2016.

Federal Direct Student Loans
2015-2016 Interest Rates Effective for Loans First Disbursed on or after
July 1, 2015 and prior to July 1, 2016

Loan Type

Borrower Type

Index

Add-On

Fixed Interest Rate

10-Year Treasury Note

Direct
Subsidized
Loans

Undergraduate Students

2.237%

2.05%

4.29%

Direct Unsubsidized Loans

Undergraduate Students

2.237%

2.05%

4.29%

Direct Unsubsidized Loans

Graduate/Professional Students

2.237%

3.60%

5.84%

Direct PLUS Loans

Parents of Dependent Undergraduate Students and Graduate/Professional Students

2.237%

4.60%

6.84%

 

2015-2016 Federal Sequestration Impacts Loan Origination Fee on October 1, 2015

Federal Direct Stafford Loan: 1.068%

Federal Plus Loan: 4.272%

As of October 1, 2015 the Federal Direct Loan Origination fees on the Federal Direct Stafford and Federal Plus Loan will decrease for the reminder of the 2015-2016 academic year and be effective until October 1, 2016. The new loan fee percentages will apply only to loans where the first disbursement of a loan is made on or after October 1, 2015.

2015-2016 Federal Sequestration Impacts TEACH Grants first disbursed after October 1, 2015

For TEACH grants first disbursed on or after October 1, 2015, and before October 1, 2016, the award amount must be reduced by 6.8 percent from the award amount for which a recipient would otherwise have been entitled. For example, the 2015–16 maximum award of $4,000 is reduced by $272.00, resulting in a maximum award amount of $3,728.00.

Pell Grant amounts will increase.

The maximum amount a student can receive in federal Pell Grants, will increase to $5,775 in the 2015-2016 academic year – a $100 increase from the previous year.

Pay As You Earn is set to expand.

President Barack Obama announced plans last June to expand access to Pay As You Earn, a federal repayment program that allows borrowers to limit student loan payments to 10 percent of their discretionary income and forgives the remaining balance after 20 years.

PLUS loans will become more accessible.

In 2011, federal lenders tightened the credit standards required to borrow PLUS loans, resulting in hundreds of thousands of rejection letters. Borrowers of federal Parent and Grad PLUS loans in 2015 will see an easing of the criteria used to determine whether an applicant has a clean enough credit record to qualify for PLUS loans. Also PLUS borrowers who sign on with an endorser will be required to receive loan counseling before receiving the loan.

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