College Avenue Student Loans Edvisors Private Student Loans

Scholarship News

Pell Grants Face a Potential $6 Billion Budget Shortfall


September 18, 2008
by Scholarships.com Staff
According to a Department of Education memo cited by the New York Times, the Federal Pell Grant program could face a budget shortfall of up to $6 billion in 2009 due to increases in grant amounts and numbers of applicants.  The cap on Pell awards has risen from $4050 to $4731 between 2006 and now, and will increase to $6000 for the 2009-2010 academic year (if funding is available) according to the recently reauthorized Higher Education Act.  Meanwhile, the number of FAFSA applications has risen by nearly 17 percent in the last year alone, driven by a worsening economic situation.

According to a Department of Education memo cited by the New York Times, the Federal Pell Grant program could face a budget shortfall of up to $6 billion in 2009 due to increases in grant amounts and numbers of applicants.  The cap on Pell awards has risen from $4050 to $4731 between 2006 and now, and will increase to $6000 for the 2009-2010 academic year (if funding is available) according to the recently reauthorized Higher Education Act.  Meanwhile, the number of FAFSA applications has risen by nearly 17 percent in the last year alone, driven by a worsening economic situation.

While data has not yet been released on whether more students are qualifying for Pell Grants or other need-based federal student financial aid this year, increasing college enrollment and unemployment rates, coupled with an overall economic downturn and increased cost of living for Americans, certainly suggest the possibility exists.  According to the Department of Education memo to Congress, tough choices or an unpopular announcement regarding Pell Grant funding may have to be made shortly after the next President's inauguration.  While it's speculated that Congress will ultimately find the money to fully fund the popular grant program, the federal government is by no means exempt from economic strain.

This announcement comes at the same time as the release of the results of an audit of 14 student loan guaranty agencies, which suggests the government may have lost over $1 billion to FFELP student loan companies taking advantage of a now-closed federal funding loophole.  Lenders had been recycling new student loans through a loan program that guaranteed a 9.5 percent return from the government on student loans made before 1993.  Lenders had been taking advantage of this loophole as late as 2006, claiming in some cases hundreds of millions of federal dollars for which they should have been ineligible.

When these loan recycling programs came to light, the Department of Education settled with lenders, allowing them to keep the money they had gained up to that point in the 9.5 percent program, but requiring them to immediately cease using the program or submit to an audit in order to continue receiving the subsidies on loans actually eligible.  So far, 14 lenders have agreed to these audits.  Based on the results, if the loan agencies audited are representative of all lenders that participated in the 9.5 percent program, federal losses could total $1.2 billion.  Several of the lenders involved in this settlement, including Nelnet, a company that also recently settled with New York Attorney General Andrew Cuomo over other questionable business practices, have also announced that they are unable to completely fund their student loan programs for the 2008-2009 school year.

Just because there are millions of college scholarships out there doesn’t mean you have time to go searching, and many won’t even match your profile. We’ve done the work and Scholarships.com is totally free. We have the search algorithms and scholarships database, saving you time in searching, finding and applying to thousands of dollars in college scholarships. Get instantly matched to scholarships that meet your unique talents, skillset and strengths, only those you qualify for. Access a complete list of college scholarships now by conducting a free college scholarship search at Scholarships.com.

Discuss

Share your thoughts and perhaps thousands of students will benefit from your unique insight on the subject!



If you can read this, don't touch the following fields


 
The college dining hall – a place for food, friends and well-earned breaks. It’s known for a wide array of food bars, buffets, made-to-order stations and generous ice cream offerings. But for the Fall 2020 semester, the dining experience will undergo a reinvention to serve food safely amidst the novel coronavirus. What will the dining halls of the COVID-19 era look like?

New Menus for College Dining in Fall 2020

June 30, 2020 10:56 AM
by Izzy Hall
The college dining hall – a place for food, friends and well-earned breaks. It’s known for a wide array of food bars, buffets, made-to-order stations and generous ice cream offerings. But for the
If you're worried about how you will pay for college during the COVID-19 pandemic, you're not alone. Students and families are concerned about the college financial ramifications as a result of the coronavirus pandemic, and higher education institutions are anticipating an increase in students' financial aid need, as well as a large number of college financial aid appeals. Fortunately, there are ample options and resources to help you pay for college these coming semesters. Explore the various options to find out which works best for your situation - from scholarship deadline extensions to relief provided through the CARES Act and more.

Paying for College during Coronavirus

June 26, 2020 3:48 PM
by Susan Dutca-Lovell
If you're worried about how you will pay for college during the COVID-19 pandemic, you're not alone. Students and families are concerned about the college financial ramifications as a result of the
On June 1st, Kansas State began bringing back student athletes to start football pre-season training with voluntary workouts. By June 20th, with 13 students testing positive for coronavirus, they shut their workout program down. What happened to the Kansas State athletes wasn’t unique – as schools, hoping to bring back the moneymaker that is college football, are discovering. And it provides an early look at what schools could be facing if they plan to re-open their campuses come the fall.

College Football Pre-Season Gets off on Wrong Foot

June 25, 2020 3:14 PM
by Izzy Hall
On June 1st, Kansas State began bringing back student athletes to start football pre-season training with voluntary workouts. By June 20th, with 13 students testing positive for coronavirus, they
Students want to go to campus this fall. Schools would like to have them there. But campus won’t be the same as it always has. In order to prevent the spread of coronavirus, colleges and universities are instituting new policies and discussing new living arrangements for their incoming students. Beyond social distancing, face masks and hand sanitizer, here are changes colleges are considering for students living on campus.

What Will Living on Campus Look Like This Fall?

June 16, 2020 10:51 AM
by Izzy Hall
Students want to go to campus this fall. Schools would like to have them there. But campus won’t be the same as it always has. In order to prevent the spread of coronavirus, colleges and universities
Are you dealing with student debt? You’re not alone. The amount of student debt that Americans owe is a staggeringly-high $1.7 trillion dollars and growing. Almost 70% of graduating high school seniors from the Class of 2019 took out student loans, and it’s likely that percentage will only increase for the Class of 2020. If you’re looking for some help managing your student loans, here are a handful of free and low-cost online resources that can help.

Want Help with Student Debt? Try These Resources

June 12, 2020 9:54 AM
by Izzy Hall
Are you dealing with student debt? You’re not alone. The amount of student debt that Americans owe is a staggeringly-high $1.7 trillion dollars and growing. Almost 70% of graduating high school
June is Gay Pride Month 2020, which marks the 50th anniversary of annual LGBTQ+ celebrations and traditions. In honor of LGBTQ Pride Month, Scholarships.com is featuring LGBTQ+ college scholarships for lesbian, bisexual, gay, transgender, and questioning students. There are also scholarships for college for those who identify as an LGBTQ+ ally! View even more financial aid for LGBTQ+ students and allies here.

Pride Month: LGBTQ and Ally Scholarships for 2020

June 11, 2020 4:20 PM
by Susan Dutca-Lovell
June is Gay Pride Month 2020, which marks the 50th anniversary of annual LGBTQ+ celebrations and traditions. In honor of LGBTQ Pride Month, Scholarships.com is featuring LGBTQ+ college scholarships
Last week the College Board officially announced that it would be suspending its plans to offer an online SAT for high school students over the summer. Earlier this year, as the organization was cancelling testing dates due to the coronavirus pandemic, they had hoped to provide an at-home version of the test. But the technological requirements needed to ensure fair testing across the country cannot be guaranteed, and the struggle many students faced submitting their AP Exams – which acted as a test run for the virtual SAT – likely contributed to the College Board’s change of plans.

College Board Delays Online SAT

June 9, 2020 10:48 AM
by Izzy Hall
Last week the College Board officially announced that it would be suspending its plans to offer an online SAT for high school students over the summer. Earlier this year, as the organization was