Amendments To Current Policy
American college students can look forward to bigger government grants and student loans as the federal student loan program is set to receive a much needed overhaul. These student loan amendments found in the new health bill are set to take out the middle men in the grant and loan giving process. This should reduce operating costs and increase money available to post-secondary students in need.
Since 1965, the government has allowed the private lenders to administer these federal student loans and grants, but at the end of the day, too much money was being lost to these unnecessary middlemen. According to analysts, this measure would save about $61-billion over 10 years. Savings would go to increased federal grants to the neediest students as well as to other education programs, including funding of community and historically black colleges. While this means that students will have fewer options in where to find grants and loans, when approved their payout would almost certainly be higher.
Current Federal Student Loans And Grants
Current federal student loans see a relatively low interest rate of no more than 5 percent on the money borrowed. Yet after paying the private lenders their cut, the federal grant and loan budget rarely has enough funds to lend the student what he or she needs. Each loan request is unique and loan recipients do not receive a set amount but rather get money based on their specific circumstances.
Federal education grants are definitely the way to go. There are so many different types of education grants that you could qualify for. If you are from a low-income household you will qualify for one of many needs-based grants, such as the federal Pell grant, that help underprivileged students pursue academic studies that would otherwise be unavailable to them. These needs-based education grants also include financial aid for audiences such as minority students, disabled students, students from very low-income families. Currently students can receive up to $5,500 for the academic year.
There are also merit-based education grants that are focused on academic excellence or excellence in a related field such as the arts or athletics. These are funds allocated to students who have demonstrated above average performance in a particular area of study or practice. Students that have high GPAs or an exceptional ability to play a certain sport will likely qualify for one of these merit-based educational grants. Some of these grants include the National SMART grant and the Academic Competitiveness Grant.