In this issue:
General News | Featured Tool | College Planning | Who's Who | Financial Aid
Scholarships & Other Aid Opportunities | Financial Literacy | Student Loan Management | Calendar
General News
OCAP 2012 Conference: 10.11.12 – Counting on a Bright Future
Busy as we are, most of us don’t know what we’ll be doing next week (let alone six months from now), but OCAP invites you to mark a special date later this year. On 10.11.12, you could be Counting on a Bright Future at the annual OCAP Conference in Oklahoma City!
Mark your calendars now for Oct. 11, 2012, and spend the day with colleagues who share your passion for helping Oklahoma students count on a bright future. With a diverse selection of breakout sessions, we anticipate this will be one of the largest conferences in OCAP history! Space will be limited this year, so stay tuned for registration information this summer and when it’s time, don’t wait to sign up.
Here’s a sampling of the great topics we’ll be discussing this year.
- Federal financial aid changes
- Oklahoma’s Promise updates
- Default prevention and management
- Financial education activities
- Reaching low-resourced populations
- Serving adult learners
- OCAP products and services
- Engaging parents
Have an idea for a session? We’re still developing topics and would love your input. Take our survey (external class) and tell us what you’d like to learn more about this year.
We look forward to seeing you in October!
OCAP Offered Staff Training Highlighting Communication Tactics
As employees, it's important to maintain and sharpen our skill sets. With so much to learn and so much daily work, we often overlook improving one of the most important skills for almost any job: interpersonal communication.
OCAP recently offered a session for financial aid professionals entitled Communicating and Negotiating Your Success at the OASFAA Spring 2012 Support Staff Training. The workshop, presented by OCAP's Mary Heid, director for policy compliance and training, and training coordinator, Liz Brandon, helped participants improve communication and negotiating skills and understand varying work personalities.
Participants learned that being good at your job can only get you so far. Developing your interpersonal communication skills can help you become great at your job. We all have to work together to accomplish our goals. Therefore, it’s essential to cultivate relationships, disagree constructively and build consensus.
For example, in order to build a meaningful connection, it’s important to become an active listener, ask thoughtful questions and be aware of body language. Mastering the art of small talk can help build trust and rapport and eventually help build stronger working relationships with co-workers, clients and your target audiences. Developing these skills can enhance your personal relationships, too.
If you’re interested in scheduling a workshop for your team or learning more about interpersonal communication skills, emotional intelligence or any other professional development topics, please contact OCAP’s Training Team at lbrandon@ocap.org or 405.234.4288.
GPACAC to Offer Two College Fairs in April
Attention high school counselors!
If your sophomores and juniors want to get a jump start on choosing a college, encourage them to attend one of the GPACAC (Great Plains Association of College Admission Counseling) college fairs in Oklahoma this month.
- Oklahoma City University - Freede Wellness Center( Campus Map (external class))
- Date: Monday, April 9
- Time: 6-7:30 p.m.
- University of Tulsa - Reynolds Center ( Campus Map (external class))
- Date: Tuesday, April 10
- Time: 6-8 p.m.
The GPACAC college fairs will provide students the opportunity to meet representatives from more than 40 colleges and universities throughout the country. Ask your students to take advantage of these free events to start planning for life after high school today!
OASFAA's 2012 Conference
It's time for the annual Oklahoma Association of Student Financial Aid Administrators (OASFAA) conference, which will be held Wednesday, April 11 through Friday, April 13 at the Holiday Inn in Norman. This year's conference theme is We’re in the Game!
OCAP staff are presenting sessions focused on default prevention, college planning and research tools for higher education legislation and regulations. Other agenda topics include federal updates; new information about verification, Satisfactory Academic Progress, Ability to Benefit rules, and Expected Family Contribution guidelines; and tips for using social media effectively.
To register and for more information, including details for exhibitors, visit the OASFAA Conference Registration (external class) page.
Spring into Action!
The birds are chirping, the rain is falling and the people are sneezing – yep, spring is here! For many of us, this means it's time to break out the mop and feather-duster and start spring cleaning. (Well, at least spring tidying.) While you clean, try out these unusual ways to reuse the items you come across.
- Old phone books
You know you have a stack of them on top of the fridge. Use the pages instead of paper towels for streak-free window wipes. - Old newspaper
After you’ve cut out your coupons and read the comics, fold up a sheet and tuck it into your fridge to absorb strong odors. Don’t forget to put a separate sheet in the veggie drawer (and throw out that moldy squash while you’re in there). - Eggshells
Instead of throwing away used eggshells, crumble them up and sprinkle them in the garden or in potted plants. They’re a natural fertilizer and their jagged edges act as a deterrent to slugs. Throw your coffee grounds in, too, for added fertilizer power. - Old shower rings
You’ll probably find these at the back of the junk drawer, where you stuck them after redecorating three years ago. You know, when you replaced them with fancy new pineapple shower rings that go with the tropical island theme. Put the old rings on the bar in your closet and hang your scarves on them. - Old wallpaper scraps
Take the leftover palm tree wallpaper from the aforementioned bathroom makeover and use it for drawer and shelf liner. - Old pantyhose
Fact1: a woman’s sock drawer, on average, contains a dozen pairs of pantyhose that were finally retired after various colorful attempts to stop runners with nail polish. Here is a creative use for each pair:
- Put old soap slivers in the toes to use every last bit of soap.
- Hang the soap slivers from an outdoor faucet for quick cleanup before going inside.
- Store rolls of wrapping paper in each leg and hang them in the closet for wrinkle-free storage.
- Fill one toe with potpourri and the other with mothballs. Hang it in your closet or tuck in a drawer.
- Fill one leg with kitty litter to create a “draft dodger” under a door or window.
- Use to store potatoes, garlic and onions in the pantry. Hang from a hook to maximize space.
- Stretch over your hand like a mitt to remove lint and pet hair from your clothes and furniture. You can also remove white deodorant residue.
- Use the hose like a rag to polish metal and other surfaces that are easily scratched.
- Fishermen: wrap chicken liver in the hose for reusable bait.
- Wear over arms and legs while hiking or gardening to avoid bug bites.
- Extend the life of screen doors and windows by gluing patches over holes.
- Your grandfather’s favorite: pantyhose can be used to replace a car’s fan belt in a pinch.
Have fun creatively cleaning!
__________
1Not, in fact a fact.
Featured Tool
OCAP’s New NSLDS Flyer
OCAP will soon release a new flyer to encourage students to utilize NSLDS, the National Student Loan Data System, as a financial aid and loan management tool. NSLDS allows students and higher education professionalsto view federal loan information, including subsidized and unsubsidized Stafford loans, Federal Family Education Loan (FFEL) and Direct Loan (DL) programs, PLUS loans (Parent and Graduate), Pell grant payments, and borrower loan statuses. NSLDS can be accessed through the student website (external class) or the professional website (external class).
The student website allows students to access their student loan information, complete their exit counseling, and review their financial aid. Students will need to accept the privacy and encryption agreements and be ready to provide:
- their Social Security number;
- the first two letters of their last name;
- their date of birth; and
- their FAFSA PIN.
Students may also contact the servicer or lender for each loan record to obtain additional information.
The professional website allows higher educational professionals (HEPs), including financial aid administrators, lenders, servicers, guarantors, and the U.S. Department of Education, to access students' loan information. HEPs access the site under the same user ID/password used for other FSA applications. The professional website offers:
- Student loan information for all of the borrower's federal student loans including the borrower's loan history, current loans, and Teacher Loan Forgiveness (TLF) information.
- Individual student enrollment information, which can be helpful in determining whether the student's Date Entered Repayment is correct for default cohort purposes.
- Contact information and resources.
- NSLDS reports based on HEP information clearance.
It’s very important to remember that you should not access students’ information unless your agency has a prior relationship with and proper authorization from each student, as in the case of IBR. To do so without authorization is in violation of your agreement with NSLDS.
OCAP’s new NSLDS informational flyer will be available soon to our campus and community partners. To learn more or request a supply of flyers to share with the students you serve, contact our Communications team at 405.234.4457, 800.442.8642 (toll free) or communications@ocap.org.
Who's Who
Do You Know Gerald Scott?
Meet Gerald Scott, executive director and founder of Services That Assist and Redeem (S.T.A.A.R.) - a faith-based, non-profit agency that offers innovative, interdependent programs that support volunteerism, education, training and mentoring. We recently interviewed Mr. Scott about his work and company.
Tell us about your work.
I am a hands-on executive director, visionary and mentor. I not only manage the Tradesman Mentoring Program, but I am directly involved in the recruitment, marketing and training of our volunteer mentor staff. Our mentoring program is gender-specific, so I am passionate about the development of men, who will become quality mentors to our at-risk youth.
The Tradesman Mentoring Program receives the bulk of its referrals from the probation officers with the Oklahoma County Juvenile Bureau. Our volunteer mentors work directly with male mentees on probation, offering positive guidance, training, and wisdom to at-risk teens in need of assistance navigating their probation plan.
What do you like most about your job?
There is so much I love about this work! First, I don't consider it work; I consider what we do "a calling." I love that we assertively seek to connect men and have the opportunity to make a difference in the lives of young men. Today's statistics indicate that over 24 million children live in homes without a father figure. It’s an amazing and rewarding endeavor each time we train and match a positive male role model with a statistically at-risk young man.
What are some of the unique services Tradesman Mentoring provides?
What makes us unique is that our program connects each individual mentee with life-changing opportunities for growth. We offer apprenticeship-style, community-based mentoring and training. Each mentee is actively involved in establishing their own individual development plan based on our seven core values, encouraging each mentee to reach his full potential.
How can people take advantage of the resources you have to offer?
Information about the Tradesman Mentoring Program is available on our website, www.tradesmanmentoring.org (external class).
College Planning
Spring Tips for High School Seniors
Are your high school seniors feeling time-crunched to prepare for college? Many students may be concerned about graduation, prom or planning for their summer vacation. As the thought of life after high school becomes a reality, the following tips may be useful for your college-bound students.
Involve parents. As you provide college planning seminars or FAFSA presentations to your students, be sure to include parents. Parental involvement helps ease the burden felt by many students who may go through this process alone. Parents can encourage their children to set goals for the future and strive to reach them. Although financing higher education may be a challenge for many families, there are many higher education options to consider and substantial financial aid available that can allow almost any student to go to college.
Encourage students to practice time management. Senior year of high school can be very hectic and busy, but students should take the time to learn some of the day-to-day skills their parents may take for granted. As a counselor or teacher, you can offer some tips on setting up a plan for time management, such as learning to get up in the morning on their own, making it to classes on time, setting up study breaks and managing life away from their parents.
Help students learn to manage money. Up to this point, most seniors have relied on their parents to pay household expenses, like car payments, insurance premiums and grocery bills. Once these students get to college, they may have to take control of these expenses on their own with less parental guidance or financial support. Visit with your students about budgeting, banking, the pros and cons of credit cards, and keeping a good credit rating. Need help teaching your seniors to be financially savvy before they head off to college? Pull Oklahoma Money Matters (OKMM), OCAP’s financial education initiative, into the ring! Our OKMM team provides free workshops, teaching tools and student guides, among many other services for educators and service providers. Contact OKMM at 405.234.4253, 800.970.6566 (toll free) or oklahomamoneymatters@ocap.org.
Encourage students to complete the FAFSA. Every student who will need financial aid for college must complete the Free Application for Federal Student Aid (FAFSA). While it's best to submit this form as soon after January 1 as possible, it's not too late to apply now. Don't let the families you serve keep believing they make too much money to qualify for financial assistance; everyone is eligible for some type of financial aid. Some schools even require students to file the FAFSA in order to receive scholarships. Instruct your students to go to FAFSA.gov (external class) to apply today!
Tell students to apply for as many scholarships as possible. There are numerous scholarship websites, books and organizations that offer scholarships for students attending college. No matter the student's grades or the family's financial situation, scholarships are available. Many websites let students set up a profile and match scholarships based on the student's qualifications. Other sites highlight new scholarships each day. Check out our Scholarship Success flyer at UCanGo2.org/Resources (PDF) (external class) to review a list of free scholarship websites and “like” UCanGo2 on Facebook to receive weekly posts on scholarships and other financial aid information.
Students can also visit their school or local library for resource books on scholarships. Two popular publications are The Ultimate Scholarship Book 2012 and The Scholarship Book 12th Edition. Both books offer information about thousands of scholarships for students of all ages. These books may also be found in your local bookstore.
Inform students about community college options. If your students find that their dream university may be out of reach in the fall, they might think about taking their first two years of general education at a nearby community college. Many courses will easily transfer to a four-year school; encourage your students to check with an admission officer to get the scoop. Completing several courses at a lower expense can help your students cover the costs of finishing that degree, whether at the community college or on a different campus, if preferred. Start compiling a list for your students of all of the local colleges that provide this benefit and distribute it early in their senior year.
Looking for more information and tools to help your students plan, prepare and pay for college? Visit UCanGo2.org (external class) or email our Outreach team at UCanGo2@ocap.org.
Financial Aid
Ask the Expert: Is It Too Late to Submit the FAFSA?
We’ve been telling you for months how important it is for students to submit the Free Application for Federal Student Aid (FAFSA) early, and that's definitely the best plan. However, if some of the families you serve didn’t get it done, here’s some good news – it's not too late!
Although it's best to complete the FAFSA as soon as possible after Jan. 1 each year aid is needed, there's still time to complete it. The 2012-2013 FAFSA is valid from January 1, 2012 to June 30, 2013. However, schools have their own deadlines, too, so be sure to check with each institution for more information.
The FAFSA is the place to start for federal financial aid. Students should fill out the FAFSA even if they don't think they'll qualify for aid. Everyone's situation is different, and nearly everyone qualifies for some type of assistance. Some scholarship applications require a student to file the FAFSA, too. Remember, the first letter in FAFSA stands for FREE; no student should ever pay to complete the form.
Students can visit fafsa.gov (external class), the official FAFSA website, for secure and convenient FAFSA filing online. Before beginning the FAFSA, students should gather all of the necessary documents including: tax forms, bank statements, investment records, etc. The full list of necessary materials can be found at fafsa.ed.gov/help/before003.htm (external class). You can also visit OCAP's FAFSA page at UCanGo2.org/FAFSA (external class) for more information and FAFSA education tools!
Higher Education Compliance Alliance
Who doesn't love finding a website with abundant compliance resources? We recently found the Higher Education Compliance Alliance (external class)
site, which aims to serve the higher education community as a centralized repository of compliance resources and information including various federal laws and regulations. The alliance includes 22 participating associations and offers a wealth of information in a user-friendly and easy-to-navigate format. Some resources on the site are restricted to members only; however, much of the information is free to any visitor. This one is worth book-marking!
Two-Factor Authentication: Coming to an Aid Office Near You
To comply with a White House and Office of Management and Budget (OMB) mandate, and as a part of the U.S. Department of Education's (ED) ongoing efforts to ensure the security of the Federal Student Aid (FSA) data systems, all authorized users will enter two forms of authentication to access FSA on the internet, a process known as “Two-Factor Authentication” (TFA). The impacted FSA data systems include: Access and Identity Management System (AIMS), the Common Origination and Disbursement System (COD) and the Student Aid Internet Gateway (SAIG).
TFA includes both the user ID and password commonly used by authorized users as well as a small electronic device known as a “TFA Token,” which randomly generates a one-time use password to allow the user access to the FSA systems. This project includes all FSA partners across the board. ED's payment system, G5, will not be affected by the TFA rollout, and authorized users of only the G5 system will not receive TFA Tokens.
The TFA phased implementation process began in February with Group 1. Oklahoma is part of Group 5, which has an estimated completion date of June 29, 2012. The process begins when ED posts an announcement on IFAP detailing which states will be entering the implementation process. Following the announcement, ED will communicate directly with the Primary Data Point Administrator (PDPA) or COD Security Administrator (CODSA) at each partner's location within that state, and provide details about how TFA Tokens will be sent to the PDPA/CODSA and how the tokens should be distributed to authorized users. Authorized users will register the token up to two times (once for COD and once for FSA AIM).
If you have questions regarding implementation of the TFA, please refer to ED’s TFA Training Presentation (external class) or email TFA_Communications@ed.gov
House FY 2013 Budget Proposals Introduced
The FY 2013 House Republicans’ Budget Plan (HR 112) passed in the House on March 29, 2012. The following proposed budget changes to higher education programs include:
- Elimination of in-school interest subsidies for undergraduate students.
- Elimination of student aid eligibility expansions enacted by the College Cost Reduction and Access Act (CCRAA), including auto-zero eligibility and the Income Protection Allowance.
- An undefined maximum income cap for Pell Grant eligibility.
- Elimination of Pell Grant eligibility for less-than-half-time students.
- Elimination of the automatic increase in the maximum Pell Grant award above $5,550.
- Elimination of Pell Grant mandatory funding.
- Elimination of Pell Grant and campus-based aid administration cost allowances.
- Repeal of the mandatory funding for College Access Challenge Grants with no corresponding increase in the discretionary funding.
For an overview of President Obama’s 2013 budget blueprint, check out the March 2012 edition of the Online News. OCAP will provide updates as more information becomes available.
What’s New on IFAP?
Dear Colleague Letters (DCLs)
Electronic Announcements
Gainful Employment (GEEA)
- March 21 – GEEA #33 - Upcoming Release of GE Informational Rates and Related NSLDS Enhancements Planned for Spring 2012 (external link) (Updated March 22, 2012)
- March 15 – GEEA #32 - Reporting Deadline for 2011-2012 Award Year GE Information
General (external link)
General
- March 22 – New Document Verification Request (G-845) Form Available(external link)
- March 19 – Complete 2011-2012 FSA Handbook with Index Linked to Entries(external link)
- March 16 – FAFSA Completion Tracking Tool Announcement for High School Counselors and Leaders(external link)
- March 16 – Revised 2012-2013 FAFSA Verification - IRS Tax Return Transcript Matrix(external link)
- March 13 – Program Integrity Questions and Answers (Q&A) 2012-2013 Federal Work-Study Program Community Service Waiver Requests (external link)
- March 12 – TFA Information - Token Distribution and E-mails for Schools in Group 2(external link)
- March 2 – Application and Verification Guide [2012-2013 FSA Handbook] (external link)
Grants
- March 27 – First Pell Grant Administrative Cost Allowance Payments for 2011-2012 Award Year Loans(external link)
- March 13 – Updated Guidance on Making Direct Loan Refunds of Cash(external link)
Common Manual Update
The latest version of the Integrated Common Manual is available on the Common Manual website. (external class) As always, if you have questions about the manual, contact our Policy, Compliance and Training department at 405.234.4432, 800.247.0420 (toll free) or pct@ocap.org.
Scholarships and Other Aid Opportunities
The Holocaust Remembrance Project is a national essay contest for high school students designed to encourage and promote study of the holocaust. The Holland & Knight Charitable Foundation recognizes the moral imperative of teaching young people about this watershed event, and is honored to provide the resources for the operation of this project.
Students are encouraged to study the holocaust and write a 1,200 word essay that explains why it's vital to educate new generations about the history and lessons learned from the holocaust, and details what young people can do to combat violence and prejudice today. First place winners will receive scholarships ranging from $2,500 to $5,000 and a trip to Boston.
Applicants must be high school students, age 19 and under, and residents of the United States, Commonwealth of Puerto Rico, U.S. Virgin Islands, Guam, or U.S. citizens living abroad. The application deadline for essay submissions is April 19.
Learn more about The Holocaust Remembrance Project at holocaust.hklaw.com/2012/index.asp (external class) , and find more upcoming scholarship programs on Scholarship Opportunities page (external class).
Financial Literacy
Drive and Save: Reduce Vehicle Fuel Costs
It's no secret the rising cost of fuel affects most aspects of your life. The cost of basic necessities like food, clothing and other merchandise are indicators of this trend. If you own a car, you're probably feeing the greatest effect at the gas station. If you’re one of the millions of Americans struggling to keep gas costs low and within your budget, try these savings tips to keep more money in your pocket.
Use technology. Many people find it counterproductive to drive around town searching for gas stations with the cheapest price while burning gas in their tank. Yet, thanks to the power of the internet and smartphones, you can check online or through a smartphone application to see which gas stations are reporting the lowest prices in your area; gasbuddy.com (external class), AAA’s TripTik ® Mobile (external class) and MapQuest’s Gas Prices (external class) are programs that allow consumers to find the best deal.
Skip higher gas grades. Do you think you'll drive faster, better or cleaner if you put premium gas in your car? According to a Federal Trade Commission report (external class) and a Consumer Reports article (external class), it's a waste of your money unless your car requires it. Therefore, in many cases, it makes sense to stick with regular unleaded fuel and save an additional five to 30 cents per gallon.
Buy a more fuel efficient vehicle. Each year, car companies are creating smaller and more fuel efficient cars. Buying a newer car with higher miles per gallon (MPG) could help you save hundreds of dollars in gas costs each year. Hybrid (gas and electric) or electric-only cars are great options if you want to boost your MPG.
Use alternative transportation. If buying a new car isn't in your immediate future, consider utilizing alternative transportation methods. If you live nearby your job and your city has adequate city planning development, you can ride a bike, walk, or rollerblade to work. This reduces car dependence, lowers damaging vehicle emissions, and promotes healthy living. Carpooling or participating in a ride-share service also helps reduce car wear-and-tear and fuel costs. As a reward for ride-sharing, many major cities have created High Occupancy Vehicle (HOV) lanes that allow vehicles carrying multiple passengers to escape congested highway lanes. Some city transit and commuter rail systems implement a Park and Ride service allowing consumers to park their car for free or a minimal fee in a designated parking lot and ride the system's bus or train into their city destination.
Let the EPA help you. The U.S. Environmental Protection Agency (EPA) has a website giving consumers tips to drastically cut out-of-pocket fuel costs. Cost-saving tips range from proper vehicle maintenance to changing driving habits. The EPA also provides information on the latest fuel efficient cars, with a comparison tool for the latest vehicle makes and models. Visit www.fueleconomy.gov (external class) for more information.
Cutting your fuel costs takes research and preparation, but it's worth the time and effort. If you use the right tools, you’ll drive ahead of the rest!
Are You Ready to Jump$tart Your Money?
Jump$tart Your Money (JYM) Week, set for April 21-27, is a statewide, coordinated effort of the Oklahoma Jump$tart Coalition and its members to raise awareness of personal financial literacy issues in our state. In its eighth year, JYM Week provides an opportunity for community organizations, government agencies, financial institutions, schools, universities, corporations and others concerned about the financial education skills of Oklahomans to plan and cooperatively market a wide range of educational events.
This year's theme is Money Milestones: Financial Success through Every Stage. A special eight-page insert in The Oklahoman on Wednesday, April 18 will include helpful personal finance articles and information about area service providers and financial education resources.
Organizations and businesses of all types are encouraged to hold an event focused on personal finance during JYM Week. Companies could sponsor a brown-bag information session about available retirement benefits and options; banks or credit unions could hold workshops for their customers highlighting budgeting methods; schools could engage a community partner (such as OKMM!) to provide staff training about smart budgeting or saving for college. You can participate even if your organization doesn't traditionally provide money-related services. Consider partnering with a financial institution or service provider to meet a need in your community. To see a list of available workshops and events, or to add your own, visit the event calendar at OklahomaJumpstart.org (external class).
JYM Week will kick-off with MoneyMania on Saturday, April 21 from 11:00 am-2:00 p.m. at the YWCA located at 1701 N. MLK Blvd. This is a family-friendly event that's open to the public and includes vendor booths, educational mini-sessions, games and activities. Visit YWCA.org/MoneyMania (external class) if you're interested in providing a vendor or activity booth or presenting a mini-session. For more information about MoneyMania, contact Jaclyn Christiansen, event chair, at 405.651.0225.
Student Loan Management
CFPB Now Taking Student Loan Complaints
The Federal Student Aid Ombudsman, launched in 1999, assists consumers with Title IV financial aid issues, such as concerns about student loan programs, loan holders and servicers, and private (non-federal) student loans. However, the FSA Ombudsman has no authority to resolve issues in the private student loan market.
As part of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, the Consumer Financial Protection Bureau (CFPB) was created to consolidate and strengthen consumer protection responsibilities previously spread across several federal agencies. The bill also specifically required the appointment of an ombudsman within the CFPB to assist private student loan borrowers, review complaints, and develop recommendations to Congress and other federal government agencies. On March 5, 2012, the CFPB officially began accepting complaints regarding student loans, and will work closely with the FSA Ombudsman to address Federal Family Education Loan Program complaints.
Consumers may request assistance or file a complaint regarding their private student loan(s) by contacting the CFPB at consumerfinance.gov/complaint (external class)
or at 855.411.CFPB (2372). The CFPB and the FSA Office of the ombudsman have executed a memorandum of understanding to coordinate response to federal student loan complaints. The CFPB website also offers online tools for consumers, such as the Student Debt Repayment Assistant and Know Before You Owe: Student Loans.
Federal Student Loan Grace Periods
Federal student loans offer some of the best loan options for students to finance their college educations. For example, unlike most private market loans, federal student loans provide a grace period, giving borrowers a set period of time to prepare for loan repayment.
Grace periods begin for students either after graduation, upon withdrawal from the institution, or when course enrollment drops below half-time. During a grace period, borrowers are not required to make loan payments. The lengths of grace periods vary, depending on the type of federal student loan.
- Perkins loans have a 9-month grace period.
- Subsidized Stafford loans have a 6-month grace period.
- Unsubsidized Stafford loans have 6-month grace period.
- For Graduate PLUS loans disbursed on or after July 1, 2008, payments can be deferred for an additional 6-months (if borrower is a parent PLUS borrower and also a student).
- For PLUS loans first disbursed on or after July 1, 2008, payment can be deferred for an additional 6-months (if the student for whom the loan was obtained is enrolled at least half-time).
Keep in mind that the majority of federal student loans accrue interest during the grace period. While some subsidized Stafford loans have an interest subsidy during the grace period, subsidized Stafford loans originating between July 1, 2012 and June 30, 2014 will not include an interest subsidy for grace periods.
OCAP’s Default Prevention team encourages borrowers to make the most of the grace period by using the time to get ready for repayment. During the grace period, students should:
- Get organized. Create a ‘my student loan’ file and place important loan documents and lender correspondence in it.
- Review current monthly expenses and adjust their monthly budget to accommodate a student loan payment.
- Research their federal student loans on the National Student Loan Database System (NSLDS) website at nslds.ed.gov/nslds (external class) (learn more about NSLDS in our Featured Tool article).
- Research student loan repayment options and choose the best repayment schedule for their financial situation. Schedule options include:
- Standard Repayment Plan – a fixed annual repayment amount for a term not to exceed 10 years.
- Extended Repayment Plan – 10 to 30 year repayment plan.
- Income Based Repayment Plan – monthly payments are based on income, not debt level, and are usually lower than other plans, including Graduated, Income-Contingent and Income-Sensitive schedules.
- Graduated Repayment Plan – initially low payments that increase every two years.
- Contact their lender(s) to discuss the terms and conditions of their student loans. Ask questions about anything they don’t understand.
- Set up automatic monthly payments. If payment is automatic, it won’t be late!
- Pay extra when possible; the extra money will go toward the principal, which will reduce the amount of interest paid over the life of the loan.
- Stay in touch with their lender(s). Make sure their lender(s) have their most current contact information so they don’t miss a statement or important letter because the lender(s) can’t find them.
Lenders will work with borrowers to resolve repayment concerns. Borrowers who are having trouble making payments because of unemployment, health problems, or other unexpected financial challenges shouldn’t panic; there are options to handle short term financial difficulty. For example, deferment and forbearance options allow for temporary suspension of loan payments. Borrowers should contact their loan holder(s) for assistance.
More information about federal student loans is available through campus financial aid offices and from OCAP’s default prevention team at 405.234.4352, 800.358.5460 (toll free) or wecanhelp@ocap.org. Check out our website, OCAP.org (external class) and visit our Facebook page, Student Loan Repayment Scoop (external class), to learn more.
Calendar
- 2011-12 State System Academic Calendar (PDF)
- Deadlines for Financial Aid Offices 2011-12(external link)
- Nelnet’s Webinar Wednesday series (external link)
- GPACAC College Fair, Oklahoma City University – April 9, 2012
- GPACAC College Fair, University of Tulsa – April 10, 2012
- OASFAA 2012 Conference, Norman – April 11-13, 2012
- Direct Loan Reconciliation and Program Year Closeout Webinar (external class) – April 19 & 24, 2012
- Deadline for FWS Community Service Waiver Requests (external class) – April 20, 2012
- FSA Title IV Fundamentals training, Dallas (external class) – May 7-11, 2012
- OCAP Annual Conference, Oklahoma City – October 11, 2012
- Deadline for Gainful Employment program information for award year 2011-2012 (external class) – October 15, 2012
- 2012 FSA Conference – November 27-30, 2012 (external class)