By Yvonne Chen
Student financial aid will be affected by a sequestration order made by the government to reduce federal spending.
Student financial aid will be affected by a sequestration order made by the government to reduce federal spending.
NJIT’s Director of Financial Aid, Ivon Nunez, says that Stafford Loans disbursed after July 1st, both subsidized and unsubsidized, will see a loan fee increase from 1% to 1.051% . This fee is deducted proportionally from each loan disbursement and is additional to interest rates paid on the loan. For example, if you borrowed $3500 last semester, you will only receive $3465 after deduction of the loan fee, but still have to pay interest on the full amount. After July 1st, borrowing $3500 would net you 3463.25 – overall, not a huge difference, but still one to keep in mind.
Interest rates on Parent Plus rates are currently fixed and have not changed, but President Obama is discussing plans to have them based off market rates of treasury notes. Work-Study grants are another area of note. NJIT’s personal Work-Study and SEOG grants will be reduced by $32,206. This will not affect the number of student job openings available on campus, as there is always need for student workers, says Nunez, but the pay and duration of assignments will reduce. Nunez encourages students whose education will be negatively impacted by financial aid changes to petition their Congressional Representatives.
Nunez reminds students who want their loans to be disbursed before the fee increase hits to file their paperwork and accept their loans by June 21st, which gives the financial aid office around a week to make sure everything is in place. Students who have not yet filed their FAFSA should also do so as soon as possible. New Jersey’s HESAA program offers need based financial aid using information from the FAFSA, so “you could miss up to $10,000 in grants.” Additionally, students who use the IRS data retrieval tool to fill out the income section of their FAFSA are exempt from being selected for data verification, so if one is eligible to use the tool, one should do so to avoid unnecessary paperwork.
As a general rule of smart borrowing, Nunez encourages students to pay interest on their loans regularly. Nunez says to expect a high estimate of 6% increase in tuition rates for the upcoming school year, which is around the same rate of increase as in the. As usual, the amount awarded for tuition-sensitive institutional scholarships will increase accordingly.
Regarding the overall NJIT financial aid process, Nunez says, “our commitment is to simplify and streamline the process to be student friendly.” Although NJIT used to disburse financial aid around two weeks into the start of the semester, they will now disburse loans as early as 10 days before the semester begins, which gives students a chance to buy textbooks and other necessary course materials using their financial aid. In order to raise awareness and increase outreach this year, Student Financial Aid Services (SFAS) has hosted events to help students complete their FAFSAs, and a Financial Aid Awareness Week which will be repeated in April and May.
SFAS is working to improve clarity on award letter emails to highlight changes and remove the need to sift through Banner for this information, though currently they are working around security limitations of sensitive information sent via email. They are also introducing a document imaging service and are in the process of scanning and shredding hardcopies of paperwork – a starting point for going paperless. “We want to counsel students more, face to face, but we’ve been too busy being compliant with federal paperwork regulations.” Nunez says this new system should free up more time for personal contact with students. Future plans include the ability to fill out financial aid forms online instead of printing them out and completing them by hand. Hopefully, these continuing changes will help foster an improved relationship between students and the oft-complained about financial aid services.
