superhera the higher education reconciliation act is not your nemesis
TRANSCRIPT
Benefits of HERA
More money for Pell eligible students ACG for first and second year students SMART for third and fourth year students
More Pell eligible students Increased income maximums for auto-zero EFC and
simplified needs test (SNT) More eligibility for Federal Student Aid
Allows room and board cost in COA for less than half-time students (two consecutive, 3 total max)
Allows cost of professional licensure or certification in COA
Provisions
Student Eligibility, Needs Analysis and COA ACG and SMART Loan Issues Institutional/Program Eligibility and R2T4
Drug Conviction Eligibility
Applicant loses eligibility for Title IV aid only if the drug-related offense for which he or she was convicted occurred while the student was receiving Title IV aid. Student considered enrolled during winter,
spring, and other breaks Student not considered enrolled if drug
offense occurs during summer break and student not attending summer school
Date of ineligibility begins on date of conviction
Simplified Needs Testand Auto Zero EFC
Only the parent’s tax return is considered for auto-zero EFC and SNT EFC determinations
Income criteria changed from $16,000 to $20,000
Means-Tested Federal Benefit Program
Alternative to Tax Return Requirement for Eligibility for Auto Zero EFC and SNT Relevant income criteria must also be met
Check the list of approved programs for 0607 in GEN-06-10 Receipt by any member of the student’s family is considered to
be a benefit received by the parent(s) of a dependent student or by the independent student
Document in student’s record how student qualified Create self-certification statement that asks the independent
student or dependent student’s parent to check the approved program from which benefits were received
Make this document required for disbursement
Qualified Educational Benefits
Treated as assets of the owner of the plan Value of account at time FAFSA is completed
is reported For prepaid tuition plans, value is amount of
refund for that year Not included as an asset if the owner is a
dependent student Not included as an asset if the owner is
someone whose information is not included on the FAFSA
Small Business Assets
The family must own and control the small business Minority partners do not “own and control” the
business Documentation
100% verification schools should review all schedules filed with tax returns
If you have conflicting information, request corporate or partnership returns or Schedule C or CEZ.
Cost of Attendance
Room and Board for Students less than Half Time Create new budget components Insert comment in student record and/or file Ask IS support specialist to write a script that will
Prevent insertion of the room and board budget components where they exist for the student in the two previous semesters or in any three prior semesters
Prevent adding the licensure/professional certification budget component if it exists for the student in a prior aid year
Licensure and professional certification Obtain receipt for the student’s file Clearly document to avoid replication
ACG and SMART
Determine Responsibility for Implementation Develop Implementation Procedures
Identify Verify Document
Develop Monitoring Process Verify Document
Loan Issues
DISBURSEMENT REQUIREMENTS
Lights out! Dual disbursement for single term loans hits the road (well almost)
30-day delayed delivery requirement: adieu! Effective Feb 8, 2006 No application required
Loans Loans Loans
New loans…. Grad PLUS: provisions and requirements
Who is eligible? Do I HAVE to certify these things? How does Grad PLUS effect aggregate loan
limits?
Loans Loans and more Loans
…..means new fees and rates!.... 1% Federal Default Fee on FFELP
loans Combined with the 3% origination fee, does this
mean PLUS borrowers will pay 4% in fees?
3% origination fee phased out over time (currently at 2% as of July 1, 2006)
Gotta love North Carolina! Phase out DOES NOT apply to PLUS
Loans are my life
New fixed rates (for loans disbursed on or after July 1, 2006): Stafford 6.8% PLUS 8.5% (FFELP) Loans certified before July 1, 2006 will continue to
have variable interest rate
New Stafford limits (effective July 1, 2007) 1st year undergraduate: $3,500 (base) 2nd year undergraduate: $4,500 (base) Grad/Professional: $12,000 (Unsubsidized)
Loans (we’re almost done)
Note: No change in the aggregate loan limits
Consolidation In-school consolidation eliminated: loans must be
in grace, repayment, deferment or forbearance Spousal consolidation also eliminated Single holder rule abolished
R2T4
Requirements Will apply to SMART/ACG; no longer apply to LEAP, SLEAP, GEAR-UP and SSS
Post-Withdraw Disbursement of Grant Funds Notification Institution MUST notify student and get
confirmation that the student still wants grant funds if grant funds disbursed directly to student….
….However PWD of grant funds may be credited to student’s account for outstanding charges without the notification process
R2T4
Completion of more than 60% of the period Return of Funds Within 45 days
Must returned unearned funds within 45 days after date of determination (increase from 30 to 45 days)
Contact Us
Terri LeGrand, Assistant Director of Financial Aid
Wake Forest University
(336) 758-5179
Ben May, Assistant Director of Financial Aid
Wake Forest University
(336) 758-5181