Posted Date: April 19, 2013

Author:  Jeff Baker, Director, Policy Liaison and Implementation, Federal Student Aid

Subject: Clarification of November 9, 2012 Packaging and Repackaging of Title IV Student Aid Announcement

In a November 9, 2012 Electronic Announcement, we provided an attachment titled “Packaging and Repackaging Federal Student Aid”. The attachment included a restatement of long-standing principles of the conditions under which Title IV student aid should be awarded to a student for attendance in a prior enrollment period within the academic year. However, the attachment included an incomplete statement about when a student who had lost Title IV eligibility because of a failure to meet the institution’s satisfactory academic progress (SAP) standards regains eligibility for Direct Loans.

In Example B that begins on page 3 of the attachment, we stated in the last sentence of the fourth item that “the student can receive Direct Loan funding for all periods of the loan period”. That statement is true UNLESS the student was ineligible for the prior period because of not meeting SAP standards. In such cases the student may not receive Direct Loan funds for the prior period(s).

The complete Example B is provided below with a revised last sentence to clarify this issue.

Example B - Student Eligibility

  1. Student Enrollment: Student was enrolled in both the fall and spring terms.

  2. FAFSA Application Status: Student did not complete FAFSA until after the end of the fall term.

  3. Student Eligibility: Student did not meet all eligibility requirements until the spring term.

  4. Aid Eligibility: Because, while the student was enrolled in the fall term, he or she did not meet all of the eligibility requirements in the fall term, even though the student applied while enrolled (here, during the spring term), the student can only receive Pell Grant funding (and campus-based funding) for the spring term – the term when eligibility was met. However, unless the student was ineligible due to not making SAP, the student can receive Direct Loan funding for all periods of the loan period, including the fall term. A student who is not making SAP regains eligibility only when the student is in compliance with the school’s SAP standards, and does not regain eligibility for a prior period of ineligibility.

   

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