Changes in Aid for 2009-2010 School Year | 05.08.09

Posted in FAFSA, Financial Aid, News, Stafford Loan, Student Loans By Kristin Morris

There are some changes that will occur for this upcoming 2009-2010 school year that will effect any student that Stimulus Package Vermontreceives some sort of Federal aid. These changes are due to the 2009 Economic Stimulus bill. Here is a breakdown of the changes and what it means for you and your financial aid:

Pell Grant increases:  The maximum annual amount for Pell Grants (free scholarships for lower-income students) increases from $4,731 to $5,350 in 2009. Congress is considering President Obama’s proposal to further boost the maximum to $5,500 next year.

Pell Grants needn’t be repaid and can be used for tuition, books and living expenses while enrolled at a participating institution. To apply, you’ll need to complete the Free Application for Federal Student Aid (FAFSA) form at www.fafsa.ed.gov. Note that the federal deadline for FAFSA submission for the 2009-2010 school year is June 30, 2009.

New tax credit: The Hope Scholarship, an educational tax credit that reduces a student’s or family’s tax liability, is being replaced in 2009 and 2010 by the more robust American Opportunity Tax Credit. Enhancements include:

* Maximum credit amount increases from $1,800 to $2,500.

* Tax credits can now be claimed for all four years of college, instead of only the first two.

* Those with an adjusted gross income (AGI) of less than $80,000 ($160,000 for joint tax filers) qualify for the full credit – a significant increase over previous years. The credit gradually phases out for AGI between $80,000 and $90,000 ($160,000 to $180,000 for joint filers).

* Unlike Hope Scholarships, this credit is partially refundable, which means lower-income families paying for college can receive a refund of up to 40 percent, even if they owe no federal income tax.

Federal Work Study Program expansion: About $200 million has been added to this program, which provides on-campus part-time jobs to students. Eligibility is determined by information provided in the FAFSA.

Financing computers: Tax-free withdrawals from 529 College Savings Plans are now allowed for computers, in addition to tuition, room and board, and books.

Federal Stafford loans: An additional $2000 in the unsubsidized loans will be available for dependent students. Also, the interest rate for subsidized loans will decrease from 6.0% to 5.6% after July 1, 2009.

So with all these additions to the Pell grant, Stafford loans, work study etc…it seems like a lot of people should be seeing more aid in their award letters for the 2009-2010 school year. If you receive more financial aid, what will that mean for you? How will it help you personally? Leave a comment, share with me, and happy Friday:)

**For Scholarship Points members enter the code STIMULUS2009 to collect your points!

Want to become a member of Scholarship Points? Click here to join and start earning points to win scholarships for school.


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307 Responses to “Changes in Aid for 2009-2010 School Year”

  1. Tony says on August 26, 2009 at 1:54 pm:

    I do believe that student loans are helpful, but it doesn’t make any sense. If you have the opportunity to earn a scholarship, then why not take it. You don’t have to pay back a scholarship or grant, so why would you want a loan that you will have to pay off and increase your debt if you don’t pay it off in time?

    Reply To This Comment
  2. Judy says on August 26, 2009 at 1:05 pm:

    Interesting info

    Reply To This Comment
  3. Inseo Park says on August 26, 2009 at 6:58 am:

    wow, this is REALLY good information. I appreciate to the person who wrote this. Thank you. I’m going to show this to my friends too :) !!

    Reply To This Comment
  4. Sami says on August 25, 2009 at 9:46 pm:

    good to know!

    Reply To This Comment
  5. alejandra says on August 24, 2009 at 9:56 pm:

    omg is this true

    Reply To This Comment
  6. Michelle says on August 24, 2009 at 9:39 am:

    This is good news but I haven’t received anything more (honestly i’ve received less for this year than my past two), and it doesn’t help the my college’s tuition increased this year.

    Reply To This Comment
  7. Anna says on August 23, 2009 at 8:20 pm:

    I’m glad I read this! Very useful!

    Reply To This Comment
  8. Tahina says on August 23, 2009 at 8:00 pm:

    Finicial aid is hard for me to receive because my parents make too much and either way im not gettin any money so it sucks for me

    Reply To This Comment
  9. Amanda says on August 22, 2009 at 6:54 pm:

    I didn’t qualify for a pell grant or really any grant because I was a few $ off :(

    Reply To This Comment
  10. rashard says on August 22, 2009 at 10:09 am:

    this is very informative

    Reply To This Comment
  11. rashard says on August 22, 2009 at 10:09 am:

    i really like the fact that most of the scholarship amounts have increased

    Reply To This Comment
  12. Lisa says on August 22, 2009 at 1:10 am:

    This are important updates. Glad to have come across this or else I wouldn’t know what has changed.

    Reply To This Comment
  13. Katherine says on August 21, 2009 at 5:12 pm:

    My parents make enough money for me to not qualify for financial aid, but they don’t help out with my college education expenses at all. Yeah, I know it’s selfish, but sometimes I wish I was poor so I didn’t have to pay as much for college.

    Reply To This Comment
  14. manyi says on August 21, 2009 at 2:08 pm:

    If college costs weren’t so high, many more people would be attending.

    Reply To This Comment
  15. Liz says on August 21, 2009 at 7:58 am:

    I don’t qualify for a pell grant, which really confuses me. I am wondering what the qualifcations are for these grants, and the policies that facilitate them.

    Reply To This Comment
  16. Lisa says on August 21, 2009 at 4:15 am:

    Even with scholarships, grants, and loans I still need to pay $1,750 per semester.

    Reply To This Comment
  17. Ky says on August 20, 2009 at 5:59 pm:

    very very good to know.

    Reply To This Comment
  18. Stephanie says on August 20, 2009 at 3:35 pm:

    I hear you

    Reply To This Comment
  19. Dino Cisneros says on August 20, 2009 at 9:06 am:

    Great news!

    Reply To This Comment
  20. Julie says on August 19, 2009 at 6:46 am:

    I still need more money.

    Reply To This Comment
  21. Joshua says on August 18, 2009 at 11:06 pm:

    There are always problems and solutions when it comes to finances and politics. This increase in spending that Obama has placed upon the U.S. seems to have an adverse effect on the amount of american money used in the world. It will be just fine for the college students of today, butI can’mt help but feeling that this spending will inflate more problems in the future

    Reply To This Comment
  22. Angela says on August 18, 2009 at 8:42 am:

    Although the additional assistance sounds like an improvement, it is still necessary for many applicants to apply for personal/educational loans.

    Reply To This Comment
  23. ash says on August 17, 2009 at 8:52 pm:

    If i receive more financial aid this year,i would decrease the amount of loan that i borrow; unfortunately, i received less financial aid this year. That’s why i am trying to look for some scholarships

    Reply To This Comment
  24. Victor says on August 17, 2009 at 8:10 pm:

    i think that the increase in money for these areas mill greatly improve the number of students having the ability to go to college but in my situation we all know that times are tough and well what doesn’t help is that the tuition prices went up as well.. so reality is that there isn’t a whole lot of change… but on the other hand its good to know whats going on with the money for school situation.

    Reply To This Comment
  25. Apryll says on August 17, 2009 at 10:45 am:

    This really helps

    Reply To This Comment

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