Financial Aid Options for Graduate Students

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In this webinar, David Smedley, Associate Director within GW’s Office of Student Financial Assistance discusses the financial aid process and eligibility criteria for graduate students.

Transcript

Angela LaGamba: Hi everyone, and welcome to the George Washington University’s Financial Aid Webinar for Graduate Students. My name is Angela, and I will be your moderator for today. Before we begin, I would like to go over logistics for this presentation and address some commonly asked questions. All participants are in listen-only mode. To ask questions type your questions into the chat box on the right-hand side of your screen and hit enter. We will address your questions throughout the webinar session, and also during out dedicated Q&A at the end of the webinar.

Your panelist today is David Smedley. He is the Associate Director of Compliance and Training in the Office of Student Financial Assistance at the George Washington University. A 20-year veteran of student aid administration, he has formerly served as the Director of Financial Aid at a two-year college with a military component, and as Director of Financial Aid for a small graduate program in international relations, national security and intelligence that has just emerged with its own accreditation. In the past year he was asked to formulate the first committee on military financing and benefits for the Easter Association of Student Financial Aid Administrators, and to serve as its first Chair. In his current role he oversees compliance review and has served as a training and professional development advocate for the Office of Student Financial Assistance.

Alright, let’s get started. I’m going to hand the presentation over to David. Go ahead, David.

David Smedley: Thank you very much, Angela. Good afternoon everybody. There are several ways to finance graduate education at GW. They are school-based student financial assistance; several schools or colleges may offer some sort of grants or scholarships, or teaching assistantships, graduate assistantships, and things of this nature; employer-based financial assistance – if you have a benefit that’s part of employment that could be one potential way; there are multiple ways of military-based financial assistance; there’s various private sources of financial assistance from private organisations, private associations, clubs, associations, and things of this nature; there is federal student aid at the gradual level, that is predominantly loans; and the University has a monthly payment plan which you can use in combination with any of the above options that I’ve just indicated to help space out the course of payments over the course of a semester. And then finally, if your employer has a contract with the University or has some sort of process for remitting payments directly to the University, that is one potential way of paying as well.

School-based financial assistance – Schools or colleges at the University may offer scholarships, fellowships, or any kind of tuition awards. However, these are mainly not geared towards distance education students. You need to keep that in mind. That being the case, if you have a particular interest in this thing, the best place to go is the Office of Graduate Fellowships’ website, which is listed on the slide.
Employer-based assistance – If you have a benefit that’s part of employment you could potentially receive tuition reimbursement for enrolment or payment upfront; that really depends on who your employer is and what their specific policies are with respect to this. So the best thing to do is to contact your Human Resources and Benefit office to find out what benefits are available and how they are… and what the procedures are for that. And just note, the last bullet, under federal law in the United States education benefits are taxable after the first $5,250. That is to say, if you receive a tuition award, a tuition scholarship award or something, above 5,250, anything above that would be taxed.

Military-based assistance is an issue that’s become very big in the past couple of years, because of the new GI Bill. But not only does the Department of Veterans Affairs offer various forms of education benefits, the Department of Defence also offers various benefits. So if you are a veteran or if you are active military, or if you are a family member of a veteran or active military, it behoves you to look into what potential options you may have available through either the Department of Defence and/or the Department of Veterans Affairs. You may have heard about the Tuition Assistance Program in the news over the course of the past year; there’s been a lot of controversy about this. The Tuition Assistance Program is a program that remits payments for active duty military to attend post-secondary education. The Department of Defence has proposed to make changes to that program, which has generated a lot of controversy. And at the moment George Washington University has not signed on to the Memorandum of Understanding. Just so that you know. And if you want to get the details on the TA program, see the link that’s listed there, which is for the Department of Defence’s military and family policy website.

Under the Department of Defence and the Department of Veterans Affairs, the GI Bill is used in broad terms, for education benefits administered by the Department of Veterans Affairs. The biggest thing is the post-9/11 Veterans Education Assistance Program, which was enacted in 2009 and revised in 2010 – and this is important because if you’re eligible for this George Washington University participates in the Yellow Ribbon Program part of the, which basically would cover all tuition charges. For complete details, see the GI Bill website.

Monthly payment plan – The University has a monthly payment plan that they contract with that will allow students to spread out costs over the course of a semester into manageable instalments with no interest assessed. And as I said before, it can be used with other forms of student assistance. And for the complete details, see the information that the Student Accounts Office has on the Colonial Central website.

Payment by third parties – The Student Accounts Office manages payments if you’re government-, if you work in government, military or certain companies and they have a direct relationship with the University for remittance of payments. This would be the way in which it is done. And there are specific procedures for having… as to how to step up doing that. And for details, go to the website that’s posted at the bottom of the slide.

Federal student aid is a broad umbrella term that relates to anything that is offered from the US Department of Education or post-secondary attendance at the graduate and professional level. This is predominantly a loan. In this case, federal Stafford Loans in which the student is the borrower. Federal PLUS loans, which traditional was only for parents several years ago, was expanded to include graduate and professional students. And also TEACH grants, which is only really applicable to students in the Graduate School of Education and Human Development. If you’re in certain professions, which are specified by law.

Just to make a couple of extra notes on federal student aid. Federal Stafford Loans, in which the student is the borrower, you may have heard a lot in the news lately about interest rates on federal student loans. And we’re going to talk about that later in the slide, but I just want to make a brief point at the current time, which is that Stafford Loans are different from PLUS loans in several ways. One is the interest rate is different. Two, the timeframe for repayment is different. And I’ll talk about that a little later.

Federal student aid is required to be certified based on what’s called a cost of attendance budget. This is where a lot of confusion comes into play with respect to student financial assistance. The cost of attendance budget is a budget that a student aid office derives based on allowable expenses that are actually in the law, in the statute, the Higher Education Act. They include tuition charges, room and board charges, transportation, and allowances for miscellaneous expenses. This is not the same as the actual tuition bill. I need to make that very clear. It is an arbitrary budget in the sense that it is an assumption on what general costs are for various students in different categories. And cost of attendance budgets can be very detailed, and is detailed, at an institution like George Washington where you have multiple different cohorts of students. And in particular because at George Washington there are varied tuition rates at the graduate and professional school level. Keep in mind, however, that our office will create a cost of attendance budget that is reflective of the actual tuition charges that you are charged, and miscellaneous expenses. For distance ed students there will not be allowances for room and board and for transportation. And for more information on this, you can see the cost of attendance website of our webpage at the bottom of the slide.

Other resources – Let’s say you receive… you’re looking to take federal student aid, but you also have some other kinds of student assistance coming in, maybe some sort of outside scholarship or grants or something like this. Or you may be receiving some sort of military-based assistance. The Higher Education Act requires that any resources that a student has to help finance their education must be reported to the Student Aid Office so that they can be factored into the certification of a federal student loan, with certain exclusions. Veterans educational assistance programs are generally excluded as a consideration as a resource. That was a change that was made about two or three years ago by statute. And that includes all of the various chapters of veterans educational assistance programs and ROTC. But other forms of military-based assistance, like the Tuition Assistance Program that I mentioned a minute ago, or a Military Career Spouse Advancement Program that the Department of Defence has, they have to be considered as resources. Or if you’re working in a branch of the military and they’re just paying for your tuition, that has to be considered as a resource as well. So it’s not uniform across the board; it’s extremely confusing. And just keep in mind that you are required to report any sort of resources that you have or that you expect to have if you are pursuing federal student loans.

The Higher Education Act also requires satisfactory academic progress standards for continued eligibility for federal student aid. And this was recently revised under new federal regulatory mandates that just went into effect July 2012.

Now you may not be able to see this clearly on the slide, but in the downloadable material that you should have had access to when you signed on to the webinar you will have a copy of not only the complete slides for this presentation but all of the embedded graphics – most of them, at least – that are in the presentation, so that you can see clearly, for one thing, but also so that you have the information. This particular reference sheet from the National Association of Student Financial Aid Administrators, which is the national association umbrella organization of student aid administrators throughout the country, of which GW is a member, lists all the current in place federal student aid programs for the 2011/2012 year. Which would end on June 30th of this year. This would include interest-, Stafford Loans – as you see, that federal loan interest rate is both subsidized and unsubsidized. And it also has federal programs which are not applicable at the undergrad-, at the graduate level, pardon me. Federal PLUS loans, federal Perkins loans, grants, etc.

Going through this federal Stafford Loans again, it is a loan in which the student is the borrower. It gets… It is offered right now through June 30th in both a subsidized and unsubsidized format. The current interest rates for graduate students are 6.8%. They become repayable six months after the completion of your program or six months after you decide to end your program and you don’t necessarily graduate. So whether you graduate or not, six months after you cease post-secondary enrolment repayment would begin.

Federal PLUS loans – the interest rate, you note, is 7.9%, a little higher than the 6.8 for Stafford Loans. Eligibility depends on what your cost of attendance is and any other student aid that you may receive, including a Stafford Loan. So basic math – cost of attendance minus other student financial student aid received equals your eligibility for the federal PLUS loan. However, federal PLUS loans have a higher interest rate, for one thing, at 7.9% versus 6.8. Two, they become repayable 60 days after the second disbursement. So let’s say you had a federal PLUS loan that is a fall and spring loan. Because the law requires that federal loans be disbursed in two equal disbursements. And through the spring disbursement is disbursed and credited to your account. 60 days thereafter the PLUS loan would become repayable. Federal PLUS loans are a flat 5% interest rate. And Perkins loans are offered by schools rather than by the US Department of Education as the lender. Because what happens is that the US Department of Education gives schools an annual appropriation, which has actually been declining over the past ten years because the federal government has not financed the program. So basically Perkins loans from year to year are made based on collections that schools make during the course of the previous years. It is the cheapest federal student loan out there, as you can see, based on the fact that there’s a 5% interest rate as opposed to 6.8 for Stafford and 7.9 for PLUS. And again, because they’re based on the appropriations that the school gets, there’s very limited funding that’s available for those schools. They do their best to try to spread that out as much possible, in as wide a net as possible for students.

I just want to make another note on interest rate. They are all fixed rates, which that is to say they will not change from year to year. Through the life of your loan the interest rate is 6.8%. This is a change from recent years. About five years ago the rates changed. They had previously been variable rates. If you know anything about interest rates you could find out pretty quickly that variable rates would be much cheaper than the fixed rates right now, given the economic instability over the past few years.

Here are the actual annual loan and aggregate loan limits for graduates and professional students for the 2011/2012 year. This will take you through to June 30th of this year. Keep in mind that through June 30th of this year graduate and professional students can borrow Stafford Loans in a subsidized and an unsubsidized format. Subsidized means that the interest rate is paid for by the US Department of Education while you are enrolled on at least a half time basis in a post-secondary educational program. Unsubsidized means that the student must pay on the interest, or can have the interest capitalized to the loan. However, capitalization of interest is generally not advisable because it makes the loan bigger over the long term of repayments. There are different levels of annual and aggregate loan limits based on certain specific programs that Congress has allowed. As you can see below, students in certain health professions programs has a higher aggregate loan limit than all other students.

Angela LaGamba: David, thank you for going over the content for the first section of today’s presentation. We do have a few questions that relate to this particular section. The first one from our audience member – Do American citizens living or working abroad still qualify for financial aid in graduate school?

David Smedley: Yes, they do. And there are instances where schools around the world – say, the University of Paris, for example – would be a participant in the federal student aid programs. And you would be able to apply for that. That’s actually true also, reciprocally, in other countries. If you were, say, a citizen of Canada the federal government of Canada and the provincial government of Canada offer student loans for their students to attend schools elsewhere. Although recent changes politically made a change in that in Canada, but generally speaking, yes. You would have the ability to apply for federal student loans.

Angela LaGamba: Wonderful, thank you. The next question that we have is also from a public member as well, and the question is – What is the amount that a graduate student would qualify for in financial aid? Or more appropriately, how would they find out how much they would qualify for for a graduate program? Go ahead, David.

David Smedley: What would happen is that if you’re interested in applying for federal student aid you would file the documents that we require to be filed, and then you would be notified as to your eligibility for the loans that you’re asking to be assessed for eligibility for. For instance, on a document that we call a loan questionnaire – which will be referenced in one of the later slides – we will ask you about what your enrolment-, what’s the program that you’re enrolled in, what your general timeframe is, things of this nature. And then also how many credits you’re expecting to register for over the course of the academic year. And then also what loans you want to be considered for. Would you like to be considered for a federal Stafford Loan or do you want to be considered also for a PLUS loan? Depending on how you answer those questions – and also in the loan questionnaire we will ask you about any resources that you may have or you’re expecting to have as well – based on the responses that you give on the questionnaire our loan processing desk will assess your eligibility and notify you through a notice primarily through our website. We do most of our notifications through the website. Actually, you can go into your account, on your account on a 24/7 basis to see what the current status is.

Angela LaGamba: And the next question that we have is – Do graduate students who are taking a Masters degree program online and part-time, would they also qualify for financial aid? And if so, for how much?

David Smedley: You have to be enrolled on at least a half-time basis in order to be eligible to pursue federal student aid.

Angela LaGamba: Those are all the questions that we have for this particular section. Let’s move on to the next section for the webinar. Go ahead, David.

David Smedley: For the coming year starting July 1st, there are all these statutory changes as a result of enactment of two sets of laws by Congress in the past couple of months, which will make changes to federal student aid programs. For graduate students it’s going to involve two different things.

What is going to happen is that graduate and professional students are going to lose the ability to borrow subsidized Stafford Loans. Congress is taking away the subsidized Stafford Loan eligibility component for graduate and professional students so that graduate and professional students will only be eligible for unsubsidized loans starting July 1st. Now you need to keep in mind that federal student loans are fixed rate. 6.8%. If you have resources such as home equity, things like this, you may know that interest rates for that are less than that, and may be something that you want to think about relative to looking at federal loan options. But keep in mind that they are fixed rates, and that starting July 1st Stafford Loans are only going to be available in unsubsidized format.

The other thing is that Congress has made changes to what happens after you complete a program. Traditionally what has happened is that once you complete your academic program, whether you graduate or leave your program, you get what’s called a grace period, of six months before you start repayment. That is not going to be the case, because of changes that have been made, as a result of budget politics mainly, in Congress. So you need to keep this in mind, graduate and professional students, that the loan rates will be unsubsidized at a fixed rate of 6.8%.

And then here this slide just gives you the annual and aggregate loan limits. Again, effective July 1st of this year. Given the fact that there will not be subsidized Stafford Loans available for graduate and professional students.

Let’s go through some examples. The Higher Education Act requires that federal student loans be disbursed in two equal disbursements. There are two different ways in which loans can be disbursed. This depends on what your enrolment intentions are going to be for an academic year. An academic year is comprised of a fall semester, a spring semester, and could also include a summer semester as well. So one uhm… I just lost my train of thought. One thing you need to think about is how you would want your loans to be disbursed, given what your enrolment intentions are going to be.

So what we have on the next few slides are basically some examples of disbursements based on either a two-semester example, fall and spring, or a three-semester example, fall, spring and summer. And then certain health professions programs, because they have higher eligibility rates, the same thing, two- and three-semester options.

So in the case of an unsubsidized Stafford Loan on two semesters, it would be disbursed-, and if you took the maximum eligible, 12, 000, it would be disbursed 6,000 and 6,000, fall and spring. And then for three semesters, if you were going to be enrolled fall, spring and summer, assuming fulltime enrolment, assuming that you’re applying for the maximum, 4,000, 4,000, 4000. Now keep in mind that federal student loans are certified as a function of a, how much you apply for, b, what your enrolment status is going to be. So you must be enrolled at least on a half-time basis to be eligible to apply for federal student loans.

For eligible health professions programs, I’ve noted in the asterisk, here are examples of a two-semester and a three-semester disbursement. Now with respect to disbursements you have to keep in mind that these are not the actual amounts that will be applied to your account once funds come into your account. Because federal law requires that a 1% origination fee be taken out of the loan. So it would be this minus 1%, basically. If you were applying for the maximum it would be actually coming at net proceeds to your account.

Which is what I just said a minute ago, that the actual net dispersal will be less than the processed amount because of the 1% origination fee. That is required by law. And we’ve found that most graduate students prefer to apply for Stafford Loans disbursed over fall and spring, frankly because you get a higher disbursement and you don’t have to worry about getting the summer disbursement. And especially if you think you’re not going to be enrolled over the course of the summer term fulltime and you’re going to be enrolled fulltime fall and spring, and you want to get the maximum. That’s one way of strategizing about how you want to do… with respect to federal student loans. But keep in mind that 1% origination fee is going to come out of your loan regardless of the amount that you apply for.

Yes, now here are the actual application procedures. The first thing you need to do is file a Free Application for Federal Student Aid (FAFSA), which is done on the web. It is free. Please keep in mind this is the website you need to use. Unfortunately, when the US Department of Education created the Free Application for Federal Student Aid back 1992, I think, they did not trademark the name originally, or protect the name. And so somebody got the bright idea of creating a website called fafsa.com, which is a for-profit site. It helps you complete the form. You do not have to pay anything to complete the Free Application for Federal Student Aid. I need you to keep this in mind. We find this a lot. We find folks a lot who come to us and tell us about this. We need to emphasize that the FAFSA is a free document. It’s actually very easy to fill out on the web. If you have your tax documents in front of you it takes you about 20 minutes to complete. There are new procedures this year that are allowing the US Department of Education to match data with the Internal Revenue Service that’s going to make life easier in the long run for applying for federal student aid. So just keep in mind that fafsa.ed.gov, that’s the website you want to go to to complete the federal student aid form. And the school code you will need is listed below.

You also want to download our own questionnaire form, which I referred to earlier. This is the document in which we’re going to ask you a lot of questions about you, your enrolment intentions, what other resources you may have, things of this nature, which will help us to certify your loan appropriately and in compliance with federal guidelines.

And then finally, once that’s done and we tell you your eligibility for loans and you accept that eligibility, you will be directed to complete a Master Promissory Note for either the Federal Direct Stafford Loan and/or the Federal Direct PLUS loan, or both, if you’re applying for both. And the website for doing so is listed there at the bottom of the slide.

For federal student loans all first-time borrowers at George Washington University are required to complete entrance counselling for Stafford and PLUS loans. Furthermore, at the end of the end of your program, usually about two or three months before your program is ending, you’ll be contacted to complete exit counselling. Entrance and exit counselling are statutory requirements for applicants and recipients of federal student aid. So this isn’t something that GW’s telling you to do; it’s something that the federal government is telling you you must do as a borrower of federal student loan programs. And then the website for doing so is listed at the bottom of the slide.

These are some of the publications that the US Department of Education has on federal student loans. I really want to highly encourage you to download all of them and read them in their entirety. We’re required to tell you that these are available by statutory requirement. But as somebody who works in training and compliance I really feel very strongly it’s very important to understand rights, responsibilities, terms and conditions, for federal student loans. And these publications do a very, very good job of doing that. And they’re free, and you can download them at the website that I’ve listed here; they’re all in Pdf format and are very easy to engage.

Okay. Let’s say you’ve gone through your program, you’ve graduated from GW, you have a piece of paper from GW, and we’ll be very proud of you for that too, loans will then enter what is called servicing. This is very important for several reasons. If you have previous loans from undergraduate education you’re going to want to pay a particular note to the next couple of slides that I have here. When you move into repayment the Department of Education, which, by the way, is the lender under Direct loans, if you have previous loans in undergraduate education you may have gotten your federal student loans through some lender, some bank, some credit union, some other lender. That is not the case as a result of statutory changes in 2010. Federal student loans are now exclusively provided by the US Department of Education through the Direct loan program.

When you-, however, what happens is that with that change in law the Department decided to keep a lot of the folks who were involved in doing student loans, but to use them on the back side to do what’s called servicing of the loan. That is to say they serve as the collector of payments. So… And there are many. There are about a good dozen different organizations that are serving as servicers for the US Department of Education.

And my third bullet is really important. If you have previous federal student loans they may have a different servicer than the one that the Department assigns for you for loans that you may take at GW. And this is where it can get very confusing. So you want to hope that you get assigned a guarantor-, a servicer, pardon me, that is the same as a servicer that services your loans from any previous education, if you have previous educational loans. A very good discussion on this is in the link that’s at bullet point number four for mapping your future. Actually, I want to direct you to that for your information.

Making payments on Direct loans is done at myaccount.com as noted in bullet point number two.

It is very important that you know who your loan holder and servicer is, especially if you have previous student loans under the federal family education loan program. The National Student Loan Data System has complete information about your student loans, period. Regardless of who the lender is, US Department of Education or any other lender. That is accessible by lenders and guarantors, servicers, and schools, for that matter. I would say you need to know that, and this will be a one-stop place you can always go to to find out where your federal student loans are at.

If you do have multiple loans from previous enrolment elsewhere, and you take loans here at GW, at some point you may want to consider what’s called a consolidation federal student loan. That allows you, basically, to combine all your loans into one loan and bag-, I call it bagging it up. You bag them all up like you’re going to a grocery store and you see a whole bunch of vegetables on the shelf. You pick out some green beans, pick out some corn, pick out asparagus, you put them all into a bag. Well, think of them as different loans that you’ve had from different years of attending post-secondary education. A consolidated loan has the advantage of having one monthly payment, you only have to deal with only one servicer, it has an early repayment option. It could actually also reduce the monthly payments as well. And for complete information see the loan consolidation website.

Federal student loans offer various loan cancellation and forgiveness options, both for Stafford Loans and Perkins loans. Options may include employment in the public sector. There are a bunch of different options for elementary and secondary education teaching, so if that’s the profession you’re looking to go into that’s something you need to look into. Here are some of the links for various loan forgiveness and loan cancelation provisions that you’ll want to look into from the US Department of Education.

Private alternative loans – I want to spend a couple of minutes on this. This is very important. For private or alternative loan – they are sometimes called private loans, sometimes called alternative loans, sometimes called private label loans, and a bunch of different terms – are education loans that are unsecured and credit based consumer loans that are not offered by the federal government. They are offered by lending institutions. They generally have higher interest rates that are tiered to what Libor rates are, and usually are very geared towards your creditworthiness. They also-, you usually have application fees and other specific requirements associated. It’s very important that you… if you’re going to consider a private alternative loan for financing your post-secondary education, that you look at federal student loans first. Because they are generally cheaper, even though they have the fixed rates that I talked about earlier. They’re still generally cheaper than private loans, because of the application fees that are involved, repayment schedules, and being geared towards creditworthiness. Whereas a federal staff loan is not geared towards creditworthiness. So you need to keep this in mind. Very important.

There is current movement in Congress right now towards mandating some level of specific counselling by schools for private alternative loans. My guess is that will probably be enacted. I can tell you that if you are considering a private alternative loan your lender that you deal with is required to tell you about the availability of federal student loans in the course of the application process that is required by law under the Truth in Lending Act. And if they don’t tell you about that you need to report it. So keep in mind, generally speaking, private alternative loans generally are not as generous in terms of repayment options for payments and deferment options and things of that nature than federal student loans are.

And as I just indicated lenders of such loans will be required to give you disclosures at several points during the application and confirmation process. You will be required, if you’re going to pursue a private alternative loan, to submit what’s called a private loan self-certification form and submit that to the lender. And you can download that specific form from our website, which is listed in bullet point number three. And it will ask you for some basic general information that you should be able to pull of from your account that you access online.

The Higher Education Act requires schools to maintain a code of conduct relative to student loans. We don’t maintain a preferred lender list; we will process any private alternative loan that is presented to us for certification. And as I indicated previously, we’ll provide counselling as pertinent to the applicant. If you want to see the formal legal document on the code of conduct, see bullet point number two, which will take you to that.

This next series of slides deals with financial literacy, which is very important to me; I’ve been doing a lot of work on this in the past year for the Office. It is really important in planning for financing graduate and professional education to know how to budget in terms of repayment for student loans of course, and other forms of consumer credit and lending. And so we want to really strongly encourage you to engage some formal process of financial literacy education. And there is a tremendous amount of information that’s available from various levels of government, community organizations and professional associations.

And to demonstrate that we’ve put together a publication, actually just fresh off the press, in the past few weeks that will list for you resources from the US government, from almost every state government, some non-US governments, various community organizations, professional organizations, guarantee agencies, various books and publications and things like this, as well as a lot of different accessibility to online content. I believe this publication was included in the downloadable material, but if you don’t have it you can access the document in its entirety at the website that’s listed at the bottom of the slide.

In addition, if you recall that I said earlier that under the “old” student loan program, quote unquote, that ceased over the course of the past year, “guarantee agencies”, quote unquote, were agencies that basically dealt with guaranteeing federal student loans that were not offered by the federal government. They are still in existence because they still are involved in collecting the loans that they were involved with, and they are required under the Higher Education Act to develop programs and services on financial literacy and to assist schools. And some of them do some particularly very fine work in this area, some of which I want to point out to you as I note on the next slide.

These particular four we have looked at really closely, and have found them to be very useful. And we want to really strongly recommend that you can look at them, because they have some very good programmatic material. In the case of American Student Assistance, their Fine Tune Your Finances Program is a series of scheduled webinars that you can register for that deal with various issues on personal finance. Education Credit Management Corporation, which is the traditional guarantor for the Commonwealth of Virginia, as well as some other states around the country, has a series of fact sheets, downloadable forms, and does some podcasts that relate to various subjects. Texas Guaranteed, which is a guarantee agency out of Texas, offers online and on-demand webinars on these subjects. I encourage you to look at one or all of these; they’re all free. And specific to the USA funds thing, the access code information is listed on the last bullet. It’s fine material, free, and you should engage it because it’s good information for you.

On a related subject, there are various tax benefits under the federal Tax Code for post-secondary enrolment. The IRS Publication 970 is the main publication, but there are several places that have some very good summary information that might be easier to read. The chart from ECMC is a very good document, it’s a nice one-pager, graphically put out, that tells you about the various different forms of tax benefits. And then USA Funds has a good summary document as well. I encourage you to look at that, because when you do your taxes next year you’ll want to know things like what funds above 5,250 in education benefits were you given, because that gets taxed. But then you may be eligible for certain kinds of tax credits that are available under the Tax Code. Now having said that, some of the education tax credits that are on the Tax Code right now are expected to expire at the end of this year, unless Congressional action is taken. And given that this is an election year I would expect that action will probably be taken. So you want to keep this in mind.

A Source for Graduate Students is a publication that’s done by the Student Affairs Division of GW. It’s a fine publication, I must say, that gives you good contact information fro various resources around the university. And you can download the complete Pdf in the link that’s in bullet point number two. I want to strongly encourage you to download and engage that document.

And finally, there’s just some information here that I have that tells you about how to navigate the bureaucracy, as it were, in the University in terms of transactional information. This slide and the one that follows basically is a embedding of a flyer that was done that tells students how to access their information online through what we call GWeb. You can access your Student Aid information, you can access your billing information, your registration information, and things like this, and this flyer tells you that. And again, in the full downloadable document you’ll have the flyer in its entirety for you to read.

It’s very important for you in the course of your enrolment at George Washington to maintain regularity with respect to engaging the administrative requirements for registering, for dealing with Student Aid, and things like this. The University will primarily communicate with you through your email account. That is to say your University email account. Not, say, if you have a Hotmail or a Gmail account or something like that. That’s not going to be where your official GW information is going to go. You need to go to your GW assigned email account to do that, or go to that account and set it up to auto forward to whatever email account that you prefer, so that you get current information on what’s going on at the University. Okay.

At this point we’ll entertain questions, of course.

Angela LaGamba: Great. So we’ve had a very interactive audience today, and we do have a number of questions for you, David. The first one we’ve actually been asked to repeat a question that you had addressed earlier on in the webinar. The questions is – Do graduate students taking a Masters degree part-time online qualify for financial aid? And if so, for how much?

David Smedley: The answer I gave earlier was that if you’re enrolled on a half-time basis in post-secondary education you are eligible to apply for federal student aid. This of course is conditional on whether or not your academic program is eligible for federal student aid. There are some certificate programs that are not eligible for federal student aid. But in general if you’re enrolled on at least a half-time basis you can pursue federal student aid. I can’t tell you how much, because that will depend on your enrolment level and whatever other kind of student aid you may have, and things of this nature.

Angela LaGamba: Great. The next question we have is around the room and board that you had mentioned, and also transportation through financial aid. Do those components-, do online distance learning students qualify for room and board and transportation through financial aid as well?

David Smedley: As I indicated earlier, when we set up cost of attendance budgets, for distance ed students we would not have room and board and transportation costs included in those budgets.

Angela LaGamba: Okay. The next question we have is – Are international students eligible for any of the loans that you’ve mentioned today?

David Smedley: International students are not eligible for federal student aid. However, they may have options for post-secondary financing from their host countries, or through private entities that offer loans for international students. The example I gave earlier from Canada, the Canadian federal government and the Canadian provincial governments offer federal student loans. Other countries do the same in the European Union. But in general, international students, non-US citizens, are not eligible for federal student aid programs from the United States government.

Angela LaGamba: The next question that we have, David, is around the upcoming 2012 summer semester. Many of our audience members wanted to know if it was too late to complete FAFSA or Financial Aid for the 2012 summer start date?

David Smedley: The answer to that is no, it’s never too late to apply for federal student aid. You have until June 30th this year to apply for student aid for the current academic year, 2011/2012. And then for 2012/2013, which starts July 1st, you would follow the appropriate FAFSA. So for instance, for the current academic year, ‘11/’12, ending this June 30th, you would use the 2011/2012 FAFSA, and for next year you would use the 2012/2013 FAFSA, both of which should be available on the FAFSA website. They will give you a dropdown box and ask you which particular year you want to file. Now when you do that, just keep in mind that you’re going to want to have the appropriate tax forms involved. So for instance, if you are applying for next year, you’re going to want to use the tax forms that you should’ve filed in the past few days. If you’re filing for the current year, ‘11/’12, you’re going to want to use the tax forms that you filed last April 15th.

Angela LaGamba: The next question that we have, David, is around a loan called the Perkins loan. So one of our students wanted to know if they’re starting a graduate program in May 2012, if the 2011/2012 financial aid would also-, that they would also be eligible for that as well.

David Smedley: A Perkins loan, again, is a fixed rate student loan that is awarded from our office based on an annual appropriation that the University gets from the US Department of Education. Primarily we give them to undergraduate students; there are some cases where we do offer them to graduate students. But because the funding is extremely limited, we try to space that out as much as we can to help as many students as possible. Mainly because the interest rate is lower than any of the other student loan options.

Angela LaGamba: The next question that we have is just a confirmation from one of our audience members. They just wanted to confirm if graduate students really are eligible to obtain subsidized Stafford Loans for 2012/2013.

David Smedley: For ‘12/’13 there will be no subsidized federal student loans, period, under statutory action that was taken earlier this year by Congress and signed into law.

Angela LaGamba: The next question that we have is more of a question around TA-ships. The question is – What is the amount covered for tuition for those attending graduate school at GW?

David Smedley: That’s a very broad question, and would be a function of whether or not you received any kind of assistance from anywhere; from school, college, federal student aid. I really couldn’t answer that. It would really depend on an individual’s circumstances.

Angela LaGamba: The next question is around timing, David, so many of our audience members, they are currently going through the process of applying to graduate school masters degree, for example When in an application process would you recommend that they begin looking into financial aid, from a timing perspective?

David Smedley: I would do it right now, quite frankly, because every school’s different. In the case of our institution, I know that we tend to start doing loan processing around June for the upcoming year. So if you’re coming to us you’ll want to download the loan questionnaire and submit that to our office right now; and to do the FAFSA for next year right now, so that everything is in place, and that if we need to follow up with you for additional information we can do that, and documentation can be on file expeditiously so that there are no inordinate delays.

Angela LaGamba: The next question is more of a clarification question, David. It’s – Are unsubsidized and subsidized loans consolidated separately to avoid higher interest principal?

David Smedley: No, you can consolidate both subsidized and unsubsidized loans together, And in the course of doing so, what will happen is that the weighted average of the loans will be assessed and that will become your new interest rate for the one loan that it creates. Again, the logic behind a consolidation loan is bagging all previous loans up, paying them off, and then creating one new loan. So there’s some economies of scale associated with that. But you’ve got to consider a lot of different things involved with that. If you have Perkins loans and Stafford Loans it may not necessarily be advantageous to consolidate because Perkins loans have specific loan cancellation and forgiveness provisions that are a little different from Stafford Loans. Which is why it’s very important to look at the information that the US Department of Education has on loan forgiveness and loan cancellation if you’re thinking seriously about consolidation.

Angela LaGamba: The next question that we have, David, is around the VA, or the Vocational Rehab Program. They wanted to know how that would work in conjunction with financial aid.

David Smedley: That I can’t honestly answer for you. And my advice, if you have military-based financial assistance, whether it’s VA, any other chapters of the VA, or DoD assistance, contact our Veterans Services Office. And in a minute I’m going to give you a slide that gives you a lot of different contact office information. And if you contact them they can guide you appropriately.

Angela LaGamba: The next question that we have is around the 21-day deadlines required on signatures for loan documents. They were wondering why GW asks for that 21-day deadline but there doesn’t seem to be a deadline by the federal financial loan office?

David Smedley: I’m not sure what that’s referring to.

Angela LaGamba: So I ask the person who asked that question if you could just send in the clarification through the chat box and we’ll be sure to ask for follow-up.

The next question that we have is – Can the total cost of this financial aid tuition be broken up into monthly payments when you’re paying that back?

David Smedley: Loans get repaid on a monthly basis according to a schedule that you will set up in the course of… I think when you do your Master Promissory Note, actually, you will indicate what kind of repayment plan you want. And there are several options that the Department will give you. And yes, beyond that they are remitted on a monthly basis. Uhm… I’ve just lost my train of thought. Oh, there is no penalty for prepayment of the full entire loan. So let’s say you have $40,000 in loan debt and you have $40,000 hanging around somewhere, and you wish to pay it all off, you would not be penalized for paying it all off at once.

Angela LaGamba: The next question that we have is around US legal residents. One of our audience members just wanted clarification if US legal residents qualify for student loans.

David Smedley: For student loans – you must be a United States citizen or an eligible non-citizen in order to be able to be eligible for federal student loans.

Angela LaGamba: And the next question that we have, David, is – If a student applies for their VA benefits and Yellow Ribbon program, do they still qualify for financial aid? And if so, how do they find out what the amount eligible is?

David Smedley: Yes, you can apply for federal student aid on top of getting Chapter 33 and Yellow Ribbon proceeds. However, you need to keep in mind that that’s a lot of money that you’re getting from the VA, and GW for that matter, in the Yellow Ribbon program, so if it comes to whether or not you really need that funding to do so – because student loans must be repaid, of course. But yes, you can apply for federal student loans on top of receiving Chapter 33 proceeds.

Angela LaGamba: David, that was the final question that we had for today. I’m wondering if you could just quickly go over some of the contact details that we have on this slide.

David Smedley: This slide just gives you all the various contact information for various offices, for which you may have transactional information. For instance, in the question that was asked about Veterans Services earlier, see at the bottom, you’ll see the Office of Veterans Services. If you send an email to that email address with the question about vocational rehab they can assist you appropriately. But then there’s our office. If you ask specific questions about follow-up on the procedures for completing the loan questionnaire, send an email to finaid@gwu.edu. Or if you require information about Student Accounts, billing, things like that, there’s the Student Accounts information, the Registrar information. GWorld is an identification card that the University has, which has some benefits associated with that. Contact them for information on parking if you have to be on campus. I realize a lot of distance Ed students are on this call. That might not be applicable. That would be the office to go to. Colonial Central, you’ll see listed here, is a general office that the University has which is basically a transactional office that deals with multiple different offices, in which you can do transactions in one place. If you happen to be on campus that would be a place to go to do that; it’s on the ground floor of the Marvin Center, for your information.

Angela LaGamba: This is all the time that we have for today. I just wanted to send a few notes to the audience that an advisor will be following up with you over the next few days to go over any additional questions that you may have. I wanted to thank David for spending the last hour with us explaining financial aid and answering all of our questions. I also wanted to thank our audience for participating in today’s George Washington University’s Financial Aid Webinar for Graduate Students. This concludes our session, and have a great day everyone.