Students paying for a degree at Boise State are now subject to new financial aid limits imposed by Congress on federally subsidized loans, effective the upcoming fall semester.
“Basically the lifetime limit on loans has historically been based on the amount. Now people who are new borrowers this academic year will have their limit based on amount and time,” said Maureen Sigler, associate director of Financial Aid and Scholarships at Boise State.
According to Sigler, this means students borrowing money will be expected to complete their degree in a certain time frame, based on how long their degree of choice is estimated to complete.
Those who change their major halfway through the education process may be in danger of running out of federal aid.
“If someone is at Boise State and they have been here a while and suddenly decide to go to CWI to get say, a degree in auto mechanics, it’s going to create challenges for them because it is a shorter program,” Sigler said.
Financial aid limits were set by Congress as part of legislation created during the summer 2013 to avoid doubling interest rates on student loans.
As a result of compromise between Republicans and Democrats, college students are now allowed to take out 150 percent of the projected cost of their undergraduate education.
“You can go for 150 percent of your program which could potentially be six years if you don’t take the full loans out every year,” Sigler said.
Sigler explained changes to financial aid limits generally end Pell Grant and subsidized federal loan availability for students who complete an undergraduate degree. Those who are able to enter graduate school or obtain second undergraduate status may be the exception.
“The bottom line is all of the changes allow students to get financial aid for their first degree, but they need to do it in a timely fashion,”
Overall, national student loan debt is estimated at over one trillion dollars and Sigler advises students to think hard about taking out full loans each year.
Future Boise State student Shaun Carson is in the process of completing his financial aid application and worries about job prospects if the economy does not improve over the next several years.
“It kind of freaks me out to think about paying all of it back, but I sort of consider my education as an investment,” Carson said.
Carson said he is isn’t sure what he wants to study just yet, but hopes his degree of choice will provide him with enough income to pay back federal loans in a timely fashion.
“There is no way I could pay my loans with my current job so I am hoping whatever I get into can earn me a decent income and help me keep my head above water when it comes to the thousands of dollars I will probably owe,” Carson said.