In 2021, Congress passed legislation to address issues related to FAFSA accessibility, the total amount that could be borrowed through student loans, and to standardize the financial aid terminology used by colleges. These changes are being implemented on a year-by-year basis.
Last year, the most notable change was the removal of a penalty for “over borrowing” that caused some students’ loans to be changed from Subsidized to Unsubsidized. Subsidized loans do not accrue any interest until after the student graduates. Unsubsidized loans start accruing interest immediately after being borrowed. This change is a huge help to those families that rely on subsidized loans.
While changes in previous years affected only specific students, this year some of the changes will impact everyone who is using FAFSA — which all college students should fill out.
Most notably, the opening date for FAFSA has moved from October 1 to December 1. This change may give the impression that it is OK to wait and fill out the FAFSA form. DO NOT DO THAT. Fill out the FAFSA as early as possible, because some of the funding is on a first-come-first-served basis. (Don’t worry if you’re a little late, none of it will run out in the first few weeks.)
“Tuition and fees,” which once covered everything besides room and board, will now refer only to tuition and fees directly related to courses, like lab fees. All other fees will be moved into a new category called “book, course materials, supplies, and equipment” and most importantly for families, for the first time this category will have its own funding.
Student transportation expenses are now taken into consideration by FAFSA when calculating need, and colleges can give some funding for transportation between campus, a student’s home, and most notably a student’s place of work.
Colleges are no longer allowed to charge an extra loan fee for non-federal loans. Federal loans were already exempt from these fees.
There is increased funding for students who are working toward obtaining a license, certification or professional credential.
If you have questions about these changes, or any other college financial aid–related issues whether you’re an Inspired Pathways recipient or not, please don’t hesitate to reach out. Some students, like Addison Hoermann, took advantage of our financial aid counseling and received much more compensation than she was expecting.
To receive financial aid counseling, sign up for a one-on-one meeting with a member of the Inspired Pathways team or reach out to our director Nate Lockett through our website.