5 Financial Aid, Student Loan Changes to Anticipate in 2015 (U.S. News & World Report)
The past several years brought some notable changes to student loans and financial aid.
But 2015 should be different, say experts.
“Generally, we don’t anticipate too many major changes this year,” says Megan McClean, the National Association of Student Financial Aid Administrators’ managing director of policy and federal relations.
Still, there are some student loan tweaks on the docket in 2015. Some are certainties, others are proposals.
Here are five to expect.
1. Federal student loan interest rates will rise or fall. Prepare for changes on the interest rates of Direct subsidized, unsubsidized and PLUS loans.
2. Pell Grant amounts will increase. The maximum amount a student can receive in federal Pell Grants, one of the most generous types of federal financial aid, will increase to $5,830 in the 2015-2016 academic year – a $100 increase from the previous year.
3. Pay As You Earn is set to expand. President Barack Obama announced plans last June to expand access to Pay As You Earn, a federal repayment program that allows borrowers to limit student loan payments to 10 percent of their discretionary income and forgives the remaining balance after 20 years.
4. PLUS loans will become more accessible. In 2011, federal lenders tightened the credit standards required to borrow PLUS loans, resulting in hundreds of thousands of rejection letters. Students of historically black colleges and universities and for-profit schools were hit particularly hard.
5. The federal rating system is scheduled for publication. The proposed federal rating system, which will rate colleges based on access, affordability and outcomes, is slated to become available by the 2015-2016 academic year. The ratings aim to give families a better sense of a college’s value and eventually tie federal funding for financial aid to a college’s performance.
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