After hearing about the Student Aid and Fiscal Responsibility Act, Dinali Wijewarnasuriya now has a greater incentive to apply to UCLA for fall 2010 admission.
“I’m considering medical school, and I don’t want a lot of debt to carry over from my undergraduate education,” said Wijewarnasuriya, a biology student at Moorpark College. “I’m not applying to private schools because of that.”
Students who receive financial aid may see some significant changes to their federal funding next year if SAFRA is passed by the Senate in upcoming weeks.
The act, which was passed in the House of Representatives in September, would increase government funding for Pell Grants. Prospective applicants to UCLA as well as current financial aid recipients can expect to see an increase in the amount of grant money received as early as next year.
“UCLA has an extremely high number of Pell grantees,” said Vu Tran, director of Undergraduate Admissions and Relations with Schools. “More than a third of our student body is on Pell Grant.”
The increase in federal grant money may very well instigate an increase in the number of applications received for the 2010-2011 school year, although exact numbers are uncertain.
“I suspect that we will continue to see higher application levels,” said Ronald Johnson, director of financial aid at UCLA, referencing last year’s 77,000 financial aid applications.
In addition to increasing funding for the Pell Grant, SAFRA also proposes to replace the 40-year-old Federal Family Education Loan Program with a direct loan system. According to the Obama administration, the program is currently costing Americans billions of dollars each year.
UCLA is in the process of adopting the direct loan program, which will funnel all government loans through a single entity.
“We have to do what we feel is best for our student community and that is why we are making this move,” Johnson said.
“At this particular juncture, I think the goal is to make the process simpler but also to make sure the students with most financial needs are provided with the most salient form of aid,” he said.
SAFRA would also make filling out the Free Application for Federal Student Aid a simpler process.
Heidi Elneil, a current UCLA applicant, said she feels that a simplification of the FAFSA would make students less apprehensive about college. For Elneil, who is currently working for an AmeriCorps service organization in Washington, it is difficult to negotiate financial information with her parents, who live in California. “I’m working eight hours a day, and when I get home I don’t even want to think about my application,” she said.
The government’s proposed increase in grant money and loan expansion is coupled with the Department of Education’s goal of eliminating private loans for college students. According to Johnson, the “safety net” of private loans is not as strong as it used to be.
The diminishing role of private loans is appealing to Scott Buchanan, a senior at Moorpark High School who plans to apply to UCLA this month.
“The less you have to pay off in the long run the better,” he said. “I want to be financially secure when I come out of college.”
However, the reduction of private loans is not without compromise. The Perkins loan, a government loan that aids UCLA’s lowest-income students, will become unsubsidized under SAFRA’s current policy guidelines. This means interest will accrue from the first day that the loan is taken out.
“We can only hope that these proposals will be altered before this legislation is approved by the Senate and signed by the President,” Johnson said.
The transition to SAFRA, which may materialize at UCLA in the next few months, is not expected to have a visible impact on students.
“This should be seamless for students,” Johnson said. “But we will be doing cartwheels in the Financial Aid Office trying to transition.”