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QUESTION: I was curious as to what Obama has changed in the student aide program since being in office? I was watching the Rachel Maddow program one night and she was rattling off a list of things she claimed Obama had fixed, but when she said finacial aide I couldn't help but cringe. I had no debt, great credit, and a lower income than I had ever had in my life, and I was unable to get even a loan for going to school. I am 32 and have been to school before and was able to get help before. I want to know what has changed. Because I really need a better job than delivering pizzas, but on my current wage I can't afford to go to school for anything. Not in community college, and certainly not grad school.

ANSWER: The biggest change that this administration has made to the student aid programs was to eliminate the Federal Family Education Loan Program (FFELP) where government backed loans were issued by private lenders.  Now all federal student loans are issued directly from the federal goverment through the Direct Loan program.  This change was made to supposedly save money in the federal financial aid budget and put more money to the Pell Grant and other programs.  I say supposedly because there have been many iterations of how federal student loans are scored in the federal budget  - some showed Direct Loans being cheaper and some showed the FFELP cost the same.  The problem is that none of the scoring I've seen scored the programs the same way.  But I digress..

The administration also introduced a new version of the Income Based Repayment program that reduced maximum federal loan payments to 10% from the current 15% for eligible borrowers.  There are quite a few other changes that have been made but those are the two biggies.

But I'm confused by your question - unless you had previously defaulted on a federal student loan, and that loan was still showing in default,  there's no reason why you wouldn't at the very least qualify for federal unsubsidized Stafford loans.  There's no credit check involved, and no "need" qualification for that loan.  Fill out the free application for federal student aid at www.fafsa.ed.gov and you should qualify for at least that loan, likely other aid as well.

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QUESTION: Every loan I've ever taken out I have paid off long before it was due. I even called Fafsa and they said I was completely paid off from the last time. My school's finacial aide department must have decided I had too many credits already to be eligable for anything. I wish there was a way I could see if the government itself would give me a loan, because apparently the school is the intermediate step and they seem to be blocking the process.

ANSWER: I'm afraid the school must be part of the process as they are considered the primary gatekeepers for federal and most state aid eligibility.  If you have too many credits, that tells me that perhaps you've reached the limit for what's called satisfactory academic progress.  This is a federal rule the school has to comply with that doesn't allow for further federal aid if it seems the student isn't progressing.  This rule is intended to ensure that students dont' incur a lot of debt and have nothing to show for it.  The fact that you are not in school now but are hitting this wall is a little confusing though - is it possible you were only going to attend a class or two?  You do need to be enrolled at least half time to qualify for aid.

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QUESTION: I attended 2 new semesters before I realized I wasn't going to be getting any loans and realized I couldn't continue paying out of pocket. I was officially enrolled in the lab technology department. I wanted to see if I could be a lab tech, or worst case scenerio a plebotomist.

Answer
Nothing you have told me would preclude you from receiving financial aid so I am still confused.  I don't understand how two semesters would give you too many credits.  I'm sorry I haven't been able to help you - I'd be happy to contact the school on your behalf but you'd have to give them written permission to speak with me.

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Betsy

Expertise

I can answer any questions about federal student loans and many about private student loans. I can also answer questions about other types of financial aid. I am not a financial planner or attorney so cannot give investment or legal opinions.

Experience

I have worked in the student loan industry for over 15 years - primarily in the compliance area. I also work with borrowers with particularly complicated issues. I had a column answering financial aid questions in several newspapers for seven years and have appeared in several radio and television segments on student loans and financial aid. I have given presentations all over the world on the US financial aid programs.

Organizations
National Council of Student Loan Programs Massachusetts Association of Student Financial Aid Administrators

Publications
Boston Metro Washington Post Express various industry blogs and newsletters

Education/Credentials
BS in Business Communications.

Past/Present Clients
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