Texas: Recommendations for Student Loan Reform Cause Mixed Emotions on Campus
"The National Association of Student Financial Aid Administrators (NASFAA) offered several policy considerations in a report released [Feb. 13] that received mixed reviews from the UT community," The Daily Texan reports. "One policy in the report considered federal government use of a “Student Loan Eligibility Index,” which would introduce minimal financial requirements that students must meet before receiving federal loans. Director of the Office of Student Financial Aid Tom Melecki said the policy has the potential to benefit and harm the students depending on how it is applied and designed. ... Another policy consideration suggested student loan repayments through Income-Based Repayment plans for all borrowers. Melecki said the plan would tie the amount paid to the borrower’s income, where the amount due in a year would depend on income earned that year. 'The Income-Based Repayment makes a lot of sense to me [especially for] those early years when you’re getting out of school,' said Melecki. 'When you can’t afford to pay a lot, it’ll suppress your payments. In addition you could opt out of the income based repayment if you wanted to pay off the loan quicker or endured a financial hardship.' ... The report also considered an option for students to be told in advance whether they are Pell eligible and guarantee an award amount as early as students’ freshman year in high school. Other policies in the report included Pell Grant incentives based on credit hours for those who already qualified for the grant and the idea to allow financial aid offices to limit the amount some students may borrow. 'I think everything in here is worth exploring and thinking about,' said Melecki. 'That does not mean that I think we should adopt everything in here. They make some really good points.'"
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