Financial Aid

A recent, unsuccessful effort by Senate leaders to provide a path to citizenship for children who were brought to the United States illegally sparked debate over the provision among financial aid administrators. The provision, commonly referred to as the DREAM Act, would allow the children of illegal immigrants to earn citizenship through higher education or military service.

Financial aid professionals have asserted for some time that the federal regulation requiring higher education institutions to verify certain information on some students' aid applications creates additional burdens for low-income students and financial aid offices. These assertions were recently confirmed by a report from The Institute for College Access and Success (TICAS) that chronicles the impact of verification on students and financial aid offices at 13 community colleges in California.

The recession has certainly forced everyone to do more with less, but financial aid administrators are dealing with a new level of this challenge. As with all campus offices, financial aid office resources and funding are being frozen or cut due to tight campus budgets. In addition, financial aid offices are serving more students and families than ever before and administering record amounts of financial aid.

With rising student loan debt, a tough job market for recent graduates, and a tougher default standard higher education institutions will have to meet in 2014, strengthening default prevention efforts is an imperative. Yet it's not always clear what factors determine default rates and how much influence higher ed institutions have in keeping defaults low.

The federal government is implementing a new method of assessing student loan default rates that will make it tougher for higher education institutions to remain eligible to receive federal student aid funds.

IN AN EFFORT TO GET AMERICA’S recently unemployed workers back to work, the Obama administration has implemented several initiatives to encourage them to learn new job skills through postsecondary education. These initiatives are likely to affect higher education institutions and provide additional opportunities to educate workers who have been negatively impacted by the economic downturn.

THE OBAMA ADMINISTRATION is pushing bold changes for the nation’s financial system, and Congress has laid the groundwork to accomplish them. While it seems certain that Congress will change student aid dramatically this year, it is less certain what these changes will be.

IT DIDN’T TAKE PRESIDENT Obama long to follow through on his campaign promise to make higher education more affordable for students and families. Within his first 50 days in office his administration worked closely with Congress to increase the maximum Pell Grant by $500 as part of the $787 billion economic stimulus package.

THE ECONOMIC DOWNTURN is sweeping the nation, affecting nearly everything and everyone. Financial aid is no different. The shaky economy has sparked several trends threatening to place unprecedented strains on financial aid programs and budgets.