<p>In terms of college financial aid, it appears that more money is approved for PELL, but cuts in the Stafford program. Also Medicare payments to providers is taking a hit. Anyone know what else is cut other than military spending? I see that Medicaid, Soc Sec and military pay is not going to be affected, and no immediate tax hikes thought the Bush provisions may end not be reappoved.</p>
<p>[Fact</a> Sheet: Bipartisan Debt Deal: A Win for the Economy and Budget Discipline | The White House](<a href=“http://www.whitehouse.gov/fact-sheet-victory-bipartisan-compromise-economy-american-people?utm_source=080111&utm_medium=blog&utm_campaign=daily]Fact”>http://www.whitehouse.gov/fact-sheet-victory-bipartisan-compromise-economy-american-people?utm_source=080111&utm_medium=blog&utm_campaign=daily)</p>
<p>The White House fact sheet is short on specifics. Anyone have a more detailed summary?</p>
<p>I’ve read the deal is backloaded-- more of the cuts occur later in the 10 year window. Half the cuts are to defense.</p>
<p>cpt or to anyone who knows, do you know what the cuts to the Stafford program are?</p>
<p>Okay, from what I have heard, there is a cut over a 10 year period for Subsidized Staffords for graduate students. Are the cuts in Staffords for graduate school only?</p>
<p>I read a few articles indicating the loss of subsidized graduate student loans. The interest on these loans is paid by the federal government while the student is in school and for six months after graduation.</p>
<p>I read in one article that some of the savings from cutting subsidized graduate student loans could be used to fund Pell Grants but this was only mentioned as a possibility. It seems to me that subsidized graduate student loans will be going away.</p>
<p>Interesting: I just saw an article that says that Pell Grant funding goes up $20 billion for the next two years. Perhaps the Pell Grants going up matches the Graduate Student subsidized loan cuts.</p>
<p>full text of proposed debt deal, see Title V:
<a href=“MSN”>MSN;
<p>Pell grants: it seems that all remaining Pell grant allocations will be dumped into one fiscal year, which would allow Congress to reallocate the money for other purposes (e.g. deficit reduction)</p>
<p>Subsidized Stafford loans: no more for grad students starting July 1, 2012, any loans made afterwards that are made under interest subsidized criteria will become unsub loans, sub loan limits will be folded into unsub loan limits of those affected</p>
<p>Direct Loan repayment incentives: not for loans disbursed after July 1, 2012</p>
<p>EDIT: this article says that Pell grants will still be around, and that the extra money allocated will be to cover a shortfall
<a href=“http://www.youthtoday.org/view_article.cfm?article_id=4947[/url]”>http://www.youthtoday.org/view_article.cfm?article_id=4947</a></p>
<p>however, there will likely be stricter criteria for getting a Pell grant from now on</p>
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<p>I’m hoping this means for loans TAKEN after July 1, 2012.</p>
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<p>yes, im sorry. it refers to loans taken afterwards, i think. the law refers to those loans disbursed after that time.</p>
<p>I can see where it says subsidized loans for graduate and profesional students are gone (which they have been talking about for a while). I don’t see where it says they are gone for undergrads.</p>
<p>And the pell is not gone at all.</p>
<p>Siglio,</p>
<p>I’m not sure you are interpreting this correctly.
- Regarding Pell grants, there is no language in the bill that indicates congress will reallocate the money to something else. That’s speculative. Not saying it might not happen, but how can you tell? The White House fact sheet released last night states this about Pell grants: “The deal provides specific protection in the discretionary budget to ensure that the there will be sufficient funding for…Pell Grants without undermining other critical investments.” I don’t pretend to know what that means exactly, but it doesn’t sound like the end of Pell grants any time soon.
- The termination of subsidized Stafford Loans does not apply to undergraduates, only graduate and professional students.</p>
<p>Subsidized loans for grad and professional students are cut starting July 1 2012. Total amount available stay the same, but no subsidies. I’m not sure if it just applies to new loans disbursed after that, or if students with existing sub loans will continue to receive the subsidy on them.</p>
<p>And repayment incentives for repaying direct loans go away - I think on loans disbursed after July 1st 2012 also.</p>
<p>So how much of the interest is subsidized, right now?</p>
<p>I think that all of the interest is subsidized - it’s $2 billion a year in interest - so figure $25 billion in loans? Graduate school is BIG business!</p>
<p>At least graduate students won’t be in the lurch for 2011-2012.</p>
<p>What are repayment subsidies?</p>
<p>
This link posted by siglio is just opinion piece about the future of the pell and stricter criteria. There is nothing in the debt ceiling bill about new criteria. (not that it would necessarily a bad idea to have stricter criteria).</p>
<p>So…I guess i am getting at…</p>
<p>Interest rates are going up?</p>
<p>And interest is going to have to be paid on interest if loans accrue?</p>
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<p>Current rates are 6.8%. No clue if they are going up or down or staying the same.</p>
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<p>I’m sure.</p>
<p>There are currently subsidized and unsubsidized loans that the unsubsidized loans accrue interest from the beginning. I guess that’s why grad school debt is such a big problem - you just put bigger and bigger amounts on your virtual credit card.</p>
<p>I think the repayment subsidy is some sort of discount on the direct loan origination fees if they make their 1st 12 repayments on time. I wasn’t really aware of them before, but noticed on the statement my daughter got about her loans that they mention them. I think the discount is given up front, when the loan was disbursed, and if you don’t make the first 12 payments on time they are added back to your debt. Hers are something like $100 ish for $14,000 ish in loans.</p>
<p>S just signed up for a subsidized graduate student loan for law school. We encouraged him to do this based on the idea that he didn’t have to pay interest while in school. I understand that if the current “debt compromise bill” (or whatever the heck it’s called) passes that beginning 7/1/2012 there, essentially, will be no “subsidized” graduate student loans. However, they cannot change the terms of the loan mid-stream, can they, in terms of those who signed up ahead of that date? He just signed the blasted thing four days ago, and I don’t want him to have the loan if he’ll have to pay interest that accrues during school. We’d figure something else out. </p>
<p>Anyone have a link that explains this better?</p>
<p>Thanks!</p>
<p>zebes</p>