<p>The loans that are disbursed for this upcoming school year can still be subsidized. But any (grad/professional) loans disbursed after July 1st 2012 will not be subsidized. So he will just have the one year of loans that are subsidized - it does not look like they will renege on subsidies for loans already disbursed before the cut off. They just will not make any new ones, so if he gets loans for subsequent years they will not be subsidized</p>
<p>These are the two most important questions for me, and I can’t definitively answer them:</p>
<p>As of July 2012, will graduate students STILL be able to borrow up to the COA in the form of unsubsidized Stafford loans and the GRAD Plus loan? </p>
<p>Will one STILL be able to defer interest payments while one is in school or do the payments actually have to be made during school?</p>
<p>Grads would still be able to borrow $20,500 + PLUS up to COA for a year. The Stafford would be all unsubsidized, though. </p>
<p>Interest could still be deferred, but it would be accumulating the whole time … you would pay interest on the interest, making the loan even larger as time goes on.</p>
<p>This is how it has been for many years. I don’t envision any changes to these things.</p>
<p>As far as the future of Pell goes, Congress writes the Pell funding legislation. It is always a last minute “will they or won’t they” in terms of funding. Last year, the Pell schedule was released & then Congress changed things … schools had to repackage awards. In that case, they increased some Pell awards. While Congress might have a set Pell amount, they also have to actually fund that amount. That is what gets tricky.</p>
<p>Best article that I’ve seen so far on the student financial aid effects:</p>
<p>[Debt</a> ceiling deal to hit grad students hard - Aug. 1, 2011](<a href=“Debt ceiling deal to hit grad students hard - Aug. 1, 2011”>Debt ceiling deal to hit grad students hard - Aug. 1, 2011)</p>
<p>OK, looks like undergrads are not affected.</p>
<p><a href=“Most Students Spared Big Cuts in Debt Bill - The New York Times”>Most Students Spared Big Cuts in Debt Bill - The New York Times;
<p>It looks like it is just graduate students. It also appears that Pell Grants funding (undergrad) may actually improve with this bill.</p>
<p>You might be interested in reading the comments posted by readers under the blog that kleibo linked (poast #25).</p>
<p>There’s a lot of anger in those thread comments. It feels like a lot of grad students and prospective grad students feel entitled to grad school. The amounts spent on grad school were eye-popping to me. At any rate, the subsidized loans are gone for graduate students providing better Pell Grant funding.</p>
<p>This gets back to the debate on whether to take out big loans to go to a top school or to go to a cheaper (much cheaper from those comments) public university.</p>
<p>^I’m not sure it’s always a sense of entitlement but perhaps because so many fields now require a graduate degree? I’m thinking of all the allied health fields, teaching, accounting, etc. where state licensing requirements set the minimum educational standards. In my state, the grad students have really felt the brunt of each wave of funding cuts, even at state schools - state aid for grads was eliminated a year ago, they’ve had several years of tuition hikes at the SUNYs that didn’t affect undergrads, and now they’re losing the federal subsidy.</p>
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<p>They may require the degree but why does the graduate student expect someone else to foot various parts of the bill? I personally think that employers should provide more of the training for their specific needs as has been done through the last century.</p>