Bypass navigation bar Search Home

Financial Aid Rules Changed July 1, 2012 — Learn What’s New


The U.S. government has set new rules for financial aid. Most of these changes went into effect with the 2012-2013 award year, which began July 1, 2012.

Here’s a summary of the new rules and how they may affect you. For more information, visit

Students Without a High School Diploma

  • If you are enrolling in college for the first time on or after July 1, 2012, you must have a high school diploma, GED or home-schooling certificate to be eligible for federal student aid.

  • You will no longer have the option of becoming eligible for federal student aid by passing an approved test or completing six college-level credit hours or 225 clock hours.

Federal Pell Grant Program — Duration of Eligibility Rule

A new federal law limits the amount of Pell Grant funds that each student can receive. This new lifetime limit of Pell Grant funds has been set at the equivalent of six years (600 percent) or 12 semesters as a full-time student.

A scheduled Pell Grant award is the maximum amount that you can receive in a school year, and it represents 100 percent of your Pell Grant eligibility for that school year.

The Lifetime Eligibility Used (LEU) is the total percentage of Pell Grant funds used. It is calculated by comparing your scheduled award amount with the actual amount that you received.


  • Award year 1: If your scheduled award for 2011-2012 was $5,550, and you attended as a full-time student for both Fall and Spring semesters, you would have received 100 percent of your scheduled award.

  • Award year 2: If your scheduled award for 2012-2013 was $5,550, and you attended as a half-time student for both Fall and Spring semesters, you would have received 50 percent of your scheduled award.

  • At the end of award year 2, you will have used 150 percent out of your 600 percent Lifetime Eligibility. (This example assumes that award year 1 [2011-2012] was the first time you ever received a Pell Grant.)

Note: This new Pell Grant Lifetime Eligibility Used rule includes students who received a Pell Grant before July 1, 2008. (The previous 18-semester Duration of Eligibility rule did not.) Anyone who has ever received a federal Pell Grant award will be limited to the Lifetime Eligibility of six years (600 percent) or 12 full-time semesters.

Expected Family Contribution (EFC)

  • The Expected Family Contribution (EFC) is a number used to determine your eligibility for federal student aid. It is based on your family income and other personal information you enter on the FAFSA.

  • For the 2012-2013 award year, the total family income to automatically qualify for an Expected Family Contribution (EFC) of zero has been reduced from $32,000 down to $23,000.

Direct Loans

  • The interest rate for all undergraduate subsidized loans disbursed on or after July 1, 2012, and before July 1, 2013, will be fixed at 3.4 percent.

  • Subsidized loans are no longer eligible for an interest subsidy during the six-month grace period after you leave school, graduate or drop below half-time (six credit hours) status. This applies to all loans first disbursed on or after July 1, 2012, and before July 1, 2014.

    If you receive a subsidized loan during this timeframe, you will be responsible for any interest that accrues during your grace period. You do not have to make payments during the grace period. The interest will be added to your principal balance.

  • Graduate and professional students are no longer eligible to receive subsidized loans.

  • The U.S. Department of Education can no longer offer repayment incentives for loans disbursed on or after July 1, 2012. You will no longer benefit from an upfront interest rebate of 0.5 percent on loans disbursed on or after July 1, 2012. However, you may still qualify for an interest rate reduction if you choose automatic payment deduction from your bank account.

Have Questions?

Contact the Financial Aid Call Center or visit one of our campus Financial Aid Offices.