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The Student Financial Aid News
A Publication of the Student Loan Network
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Read this issue in color at:
http://www.FinancialAidNews.com/aug2005.php
Tune in to the free podcast at:
http://www.FinancialAidNews.com/financial-aid-podcast.php
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August 2005 Issue : Back to School 2005
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In this issue:
• Introduction
• Featured Article: Financial Aid Goes to Washington
• Scholarship Notes
• A Word from our Sponsors
• Privacy and Subscription Information
• Back Issues
• Sponsor this newsletter!

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Introduction
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Welcome to the August 2005 issue of FinancialAidNews.com. Well, we’ve taken the plunge with podcasting over the last month, and put together some podcasts that are just incredible - you can hear from leading experts in the financial aid field about what you need to do to get as much aid as possible, experts like Dr. Joseph Cronin and Mark Kantrowitz. Did you know, for example, that you may need to start scholarship planning as early as middle school? It’s true - find out more by tuning into the podcast. Visit:

http://www.FinancialAidNews.com/financial-aid-podcast.php

This month, we cover news about the Higher Education Act Reauthorization, important information about where to get student loans, and getting ready for back to school.

Take our survey! Let us know how we can improve the Financial Aid News and Podcast; five lucky respondents will win a $15 iTunes Music Store Gift Card. Visit:

http://www.FinancialAidNews.com/show.php/Survey/

As always, please share The Student Financial Aid News with your friends, family, and colleagues, by simply forwarding this message, or letting them know to subscribe by visiting www.FinancialAidNews.com today!

Enjoy this month’s newsletter!

Christopher S. Penn
Publisher, The Student Financial Aid News
Producer/Director, The Financial Aid Podcast

The Student Financial Aid News
A Publication of the Student Loan Network
15 Cottage Avenue, Fifth Floor
Quincy, MA 02169

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Featured Sponsor: Get a private student loan in 5 business days!
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Featured Article: Financial Aid Goes to Washington
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What’s happening on Capitol Hill? The Higher Education Act Reauthorization, named the College Opportunity and Access Act of 2005, in the House of Representatives. For regular subscribers to our blog and podcast, you got the news as it happened. Here’s the summary - in general, there has been no major net change in financial aid availability, and overall, the changes in the Higher Education Act may draw approximately $11 billion away from the Department of Education to be used for deficit reduction, by the President’s orders. What’s changed and what’s staying the same? As the act stands now:

Stafford Loan limits are changing for first-year students, sophomores, and graduate students.

+ First-year students will have access to $3,500 in subsidized Stafford loans instead of $2,265.
+ Sophomores will have access to $4,500 in subsidized Stafford loans instead of $3,500.
+ Juniors and seniors receive no increase.
+ Graduate students will have access to $12,000 in unsubsidized Stafford loans instead of $10,000.

Loan origination fees for non-Direct Loans are decreasing from the current 3% fee to:
+ 2.0% from 2006 - 2008
+ 1.5% from 2008 - 2010
+ 1.0% from 2010 onward

Phaseout of the Perkins loan program by 2016.

Incentives for teachers of math, science and special education in low-income school districts. Currently, forgives such teachers up to $5,000 of their student loans; the new bill increases that amount to $17,500.

Elimination of spousal student loan consolidation.

Students who want to consolidate their loans will be given a choice between a variable rate loan consolidation and a fixed rate loan consolidation.

+ If you choose a variable rate consolidation, you’ll get the 91-day T-bill rate at the last auction in May of each calendar year plus 2.3%.
+ If you choose a FIXED rate consolidation, you’ll get the 91-day T-bill rate at the last auction in May of each calendar year PLUS 3.3% PLUS a 0.5% origination fee.

All of these changes, assuming the Act passes both houses of Congress and the President in September, will take effect as of July 1, 2006.

Financial aid expert Mark Kantrowitz noted in our July 27, 2005 podcast (definitely worth listening to) that with no major net change in financial aid to students, and continuing increases in tuition and education expenses, that students and families will need to turn to private student loans in increasing amounts.

To get more information about consolidating your loans before the reauthorization takes effect, visit:

http://www.TodayISave.com

To get more information about private student loans to bridge the gap between the cost of education and federal financial aid, visit:

http://www.AlternativeStudentLoan.com

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Scholarship Notes
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With interest rates rising across the board, it’s more important than ever to have the best tools available for your search for interest-free money, and that means scholarships. That includes free solutions like Google and premium solutions like Financial Aid Officer’s Scholarship Search. For a nominal fee, you get access to an ever-increasing database of scholarship awards, more than 2.3 million worth $14 billion.

If you can’t find the financial aid you’re looking for online, try the FinancialAidOfficer.com Scholarship Search Service at

http://www.GotScholarships.com

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And now a word from our sponsors…
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Student Health Insurance

Securing a good quality, reliable health insurance plan can sometimes be a daunting prospect. There are many providers, all offering similar plans, promising the same things. With eStudentInsurance.com this is different!! eStudentInsurance.com now has a range of high quality domestic and international health insurance plans in an easy to view format, designed with students in mind. The new plans include such benefits as:

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Learn a new language now

Learning a new foreign language can open you many doors, whether you are doing business internationally, boost your career or even if you are just traveling to another country.

The best language schools for people interested in learn a new foreign language:
+ Spanish language courses
+ France courses
+ Italian courses
+ German courses
+ English courses

More information here:

http://www.FinancialAidNews.com/show.php/Languages

Student Credit Cards

Got credit? Student credit cards can - if used properly and prudently - be a great stepping stone towards the establishment of great credit. Find out more about credit cards and establishing credit, and get the Chase Ultimate Rewards Student Credit Card online! Visit:

http://www.StudentPlatinum.com

Study Abroad Loans!

Are you a US student who needs a loan for studying abroad? Look no further than Study Abroad Loans. We provide up to $30,000 per year for all study-abroad education expenses. Visit:

http://www.StudyAbroadLoans.com

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Privacy & Subscription Information
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You can always change your subscription options by visiting our subscription page, located at:
• http://www.FinancialAidNews.com

We value your privacy. We do not under any conditions sell, rent, share, or distribute your email address at any time unless you specifically request that we do so by applying for a specific product or service. Organizations and companies that wish to communicate with you must do so by sponsoring our newsletter.

Would you prefer to read Financial Aid News as an RSS feed? You can! We update the feed for each issue. You can subscribe to it using FeedReader or any RSS/XML feed reader at:

• http://feeds.feedburner.com/StudentFinancialAidNewsandPodcast

If you wish to write us via postal mail, you can direct correspondence to:

The Edvisors Network, Inc.
15 Cottage Avenue, Fifth Floor
Quincy, MA 02169

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Back Issues
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Missed an issue? Did you remember a scholarship but can’t find the back issue? You can always find back issues of the Financial Aid Newsletter at:
• http://www.FinancialAidNews.com

Want to tell a friend about the newsletter? Forward a copy to them, or have them visit:
• http://www.FinancialAidNews.com

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Sponsor the Financial Aid Newsletter!
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Sponsorships are limited to one per month. Your Sponsorship message in the newsletter will be delivered to more than 377,000 subscribers, many of whom forward the newsletter to friends, associates and customers. If you would like us to consider you or your company for Sponsorship, please send email to: newsletter@financialaidnews.com

The Student Financial Aid News is a publication of the Student Loan Network.
Copyright © 1998 - 2005, the Student Loan Network.

The Student Financial Aid News
A Service of the Student Loan Network
15 Cottage Avenue, Fifth Floor
Quincy, MA 02169

No, it’s not a disease. It’s another Podcast directory!

Show notes, July 29, 2005

News
+ Antidrug provisions in HEA Reauthorization continue to prohibit aid for anyone convicted of a drug related misdemeanor or felony
+ If you would like to lobby your elected representatives, contact them via:
++ House.gov
++ Senate.gov

Mail Call
+ Order of financial aid applications
+ Eligibility for financial aid
+ Deferment and forbearance
++ Information on StudentLoanConsolidator.com
+ Alternative student loan minimum income requirements
+ Trivia about interstates
++ Wikipedia.org

Podsafe Music
+ Jim Fidler
++ Website
++ Merrigan’s Reel
++ Flow on Waterford River
++ Lillian

News
+ Colleges react to HEA Reauthorization
+ In Massachusetts, schools like Northeastern could face cuts up to $4M in aid
++ Article on the Daily Item

Interview
+ Nicole Barry, deputy director of the Congressional Advisory Committee on Student Financial Aid
++ Website at ED.gov

Podsafe Music
+ Clumsy
++ “Fruitless”
++ Web site at Clumsy.info

Direct file download: MP3 File

Show notes, July 27, 2005

News
+ UVa adds $4M to instititutional financial aid, totaling $20M

Interview
+ Mark Kantrowitz of MK Consulting, a 20 year financial aid veteran
++ Website: Kantrowitz.com
++ What you MUST do to afford college if you have young children
++ The future of financial aid

Mail Bag
+ Changing lenders?
+ HEA Reauthorization and impact on existing loans?

Podsafe Music
+ Whirl
++ Captivity
++ Site: WhirlMusic.com

Direct file download: MP3 file

Our new promo is out - a 1 minute, 9 second promo for the Financial Aid Podcast. If you have a podcast and would like to help us out, please give our promo a play!

Direct file download: MP3 file

Thanks ever so!

Show notes, July 26, 2005

News
+ Consolidation 1% penalty
+ Conflict of interest in Congressional committees
+ Sallie Mae politicians
+ Find out who owns which politicians at OpenSecrets.org

Mail call
+ Stafford loans
+ No cosigner
+ Scholarships
+ Interest rate computation

Podsafe Music
+ Whirl
++ Website
++ Reborn
++ Stronger than One

Direct file download: MP3 file

Late breaking news on House Bill 609 - an amendment was passed (quietly, I might add) to make consolidation even more expensive and less attractive. What’s in the mix?

If you choose a variable rate consolidation, you’ll get T-bill plus 2.3%.

If you choose a FIXED rate consolidation, you’ll get T-bill plus 3.3% PLUS a 0.5% origination fee.

Obviously, someone clearly wants to make fixed rate consolidation unpalatable. But who? Who benefits from variable rate consolidation and not fixed rate consolidation? Well…

… lenders do. Big lenders, lenders with portfolios of billions of dollars in student loans that want to discourage students from shopping around. Each time you consolidate, wham! 0.5% fee. Let’s see who sponsored this:

Howard “Buck” McKeon, R-CA
John Boehner, R-OH

Now, let’s look at campaign contributions… as they say, follow the money.

Rep. McKeon
Rep. Boehner

Funny, Bank of America and Sallie Mae figure prominently in the campaign contributions. In other words, you might as well stamp on the amended HR 609: “This Bill Brought To You By Sallie Mae”.

Disclosure: The Student Loan Network is also a third party lender, and as such, would actually benefit from a lot of these proposals. However, our primary interest is in serving students in the long term, not making a quick buck. We’re old fashioned in the sense that we believe a happy, satisfied, well-treated customer will come back again and again, and tell others about us. So in this case, and in nearly every case, we side with the students and not the corporate lobbyists. I was going to use a different word there, but this is supposed to be family friendly…

Show notes, July 25, 2005:

News
+See our previous entry on the Higher Education Act reauthorization for details
+ $12 billion in savings
++ Where’s the savings going? To the national debt. The savings will reduce the debt by approximately 0.15% per year. By comparison, the current Middle East campaign, valued at $175 billion, would reduce the debt by approximately 2.1% per year.
++ Savings is coming from reduced subsidies
++ That same $12 billion could be used to fund 300,000 full tuition scholarships to Ivy League schools or 1.2 million scholarships to public, state universities
+ To access the text of the bill, visit Thomas at Thomas.LOC.gov
+ To write your representatives, visit:
++ House.gov
++ Senate.gov

Podsafe Music
+ Round the Bend from Adrina Thorpe - AdrinaThorpe.com
+ How Hazardous We Are from The Transfer - The Transfer web site

Direct file download: MP3 file

The House Committee on Education and the Workforce just completed its work on the Higher Education Act reauthorization, which is called the College Access and Opportunity Act of 2005. We’re going to talk about this on the podcast on Monday morning, but here’s the highlights so far:

Changes in the Higher Education Act as proposed and voted in H.609

Stafford Loan Limits
+ Freshman increase from $2,625 to $3,500.
+ Sophomores $3,500 to $4,500.
+ No change for juniors, seniors, and beyond.

Consolidation - variable rate, T-bill + 2.3% for all consolidations after July 1, 2006, capped at 8.25%

Decline in origination fees:
from 3% now
2% from 2006 - 2008
1.5% from 2008 - 2010
1% from 2010 onward

No more spousal consolidation - Amendments- Section 428C (20 U.S.C. 1078-3) is amended-(1) in subsection (a)(3), by striking subparagraph (C);

No more single lender rule after July 1, 2006

Increase in unsubsidized Stafford Loan limits for graduate students from $10,000 to $12,000 after July 1, 2007

Phaseout of Perkins Loan program by 2016

Students cannot consolidate their loans if they want to have income contingent repayment. Income contingent repayment plans allow students who wish to enter into low-income jobs such as public criminal defense or public education to stretch out their payment plans over a longer period of time.

Consolidation fee of 0.5% on loan balance

Incentives for teachers of math, science and special education in low-income school districts. Currently, forgives such teachers up to $5,000 of their student loans; the new bill increases that amount to $17,500.

How to read the College Access and Opportunity Act:

Pull up http://thomas.loc.gov/ and http://uscode.house.gov/

In Thomas, you’ll be looking for House bill 609.

Make changes to the appropriate sections of US Code mentioned in the bill.

The ultimate question: is this good or bad for students? Tune in to tomorrow’s podcast.