Breadcrumbs

White House Investment in Student Aid


October 23, 2012

 

Helping Middle Class Families Afford College:

Here's some information about what the White House is doing in terms of Student Aid. 

 

The President has raised the maximum Pell Grant award to $5,635 for the 2013-14 award year — a $905 increase since 2008. Under the President’s leadership, the number of Pell Grant recipients has expanded by 50 percent over that same time, providing college access to millions of additional low-income and middle-class students across the country. The Obama Administration’s landmark investment in the Pell Grant was enacted in the Health Care and Education Reconciliation Act of 2010, which ended student loan subsidies for private financial institutions and banks and shifted over $60 billion in savings back to students.

 

We also see a large shift towards income based repayment being the norm of repayment options. The Administration’s “Pay as You Earn” plan expands income-based repayment to enable 1.6 million students to take advantage of a new option to cap repayment of student loans at 10 percent of monthly income — an option that student borrowers can begin to use at the end of this year. These changes will reduce the burden of student loans in a fiscally responsible way. Additionally, millions of borrowers are now eligible to consolidate Direct Loans and FFEL Loans and save up to half a percentage point on their interest rate.

 

In terms of Education Tax Credits, President Obama established the American Opportunity Tax Credit in 2009 to assist families with the costs of college, providing up to $10,000 for four years of college tuition for families earning up to $180,000. Over 9.4 million students and families benefit from the American Opportunity Tax Credit each year. President Obama has called on Congress to make this tax credit permanent and prevent it from expiring in 2012.

For more information: Everything you need to know about income-based repayment

 

In terms of STAFFORD LOAN Rates, President Obama stated in his State of the Union address, the President called on Congress to keep interest rates low for the 7.4 million borrowers who take out subsidized Federal student loans for this school year. With President Obama’s leadership, rates on new subsidized Stafford loans remained at 3.4 percent — instead of doubling to 6.8 percent — this past summer. This bold action saved students an average of $1,000 on the life of their loans, and President Obama has committed to keeping interest rates low for student loans moving forward.

 

Protecting Our Veterans, Military Spouses, and their Families

President Obama’s Executive Order Establishing Principles of Excellence for Educational Institutions Serving Service Members, Veterans, Spouses, and Other Family Membersprovides new protections for our nation’s military, veterans, and their families to help ensure they have the information they need to succeed in higher education. The Principles of Excellence — which will apply to a variety of military and veteran education benefits, including the GI Bill, Tuition Assistance Program, and Military Spouse Career Advancement Account Program (MyCAA) — cracks down on improper online recruiting practices, improve support service, provide better data on educational institutions, and strengthen enforcement of student protections. The President believes we must do all we can administratively to protect veterans from these deceptive practices by improving the quality of information and services that these schools must provide, and these steps will help ensure that Federal military and veteran education dollars are well spent.  

 

In addition to all of these efforts, the Federal Government has been working towards establishing a 'Financial Aid Shopping sheet'. This is done in an effort to have all scholarship, grant, and loan standards similar so incoming freshman can compare apples-to-apples. The Department of Education and the Consumer Financial Protection Bureau have launched the “Know Before You Owe” campaign to create a model financial aid disclosure form — the Financial Aid Shopping Sheet — to help students better understand the type and amount of aid they qualify for and easily compare aid packages offered by different colleges and universities. The Financial Aid Shopping Sheet is an individualized standard financial aid award letter that will help students and families understand the costs of college before making the final decision on where to enroll. The Shopping Sheet is being voluntarily adopted by colleges and universities across the country for the 2013-14 academic year to provide students and families with critical information about their financial decision to attend college in a clear, concise, and standardized format that facilitates easy comparisons across institutions.

 

See how FIU Ranks in our College Scorecard.

Read more at, The White House Policies- Education