Fee eliminated for Louisiana Guaranteed loans
Louisiana students who participate in the Federal Family Education Loan Program (FFELP) could save as much as $2 million annually with the elimination of the 1 percent insurance fee traditionally charged by the state’s guaranty agency. The elimination of the fee for loans guaranteed by Louisiana on or after May 5, 1999, was announced on April 29 by Governor Mike Foster.
The action was ratified on April 27 by the Louisiana Student Financial Assistance Commission, the regulatory body which oversees operations of the state guarantee agency.
"Elimination of the insurance fee on student loans guaranteed by the state is another example of Louisiana’s commitment to making a college education as accessible and affordable as possible for our young people," Foster said. "Not every student will qualify for a scholarship and most scholarships will not cover all qualified costs of attendance," he added. "This is our way of assisting those students who must supplement their education funding through loans."
Jack L. Guinn, Executive Director of the Louisiana Office of Student Financial Assistance (LOSFA) further commented, "TOPS, our premier state scholarship, only covers the cost of tuition, which is usually less than half the cost of attending an institution of higher learning. Supplementing TOPS awards with affordable student loans is a necessity for many students. Our goal, through the many programs administered by our office, is to make a college education as affordable as possible for our students and their families."
Guinn continued, "Preparation for the cost of attending college should begin at an early age with the enrollment of children in the START Saving Program, Louisiana’s tax-deferred college savings plan, and continue throughout middle and high school with the development of good study habits that will lead to the students’ qualification for TOPS scholarship awards."
Guinn further stated. "Finally, if additional funding is needed, we want to be sure that student loans guaranteed by the State of Louisiana are the most affordable loans available to our students and their parents."
LOSFA is responsible for administering the START Saving Program, the TOPS program, and the Louisiana guaranteed student loan program. Later this summer, the agency plans to unveil the Louisiana College Payment Plan which will combine the savings, scholarship and loan programs into a single benefits package. Participation in the Louisiana College Payment Plan will be initiated by enrollment of a child in the START Saving Program.
Loans which qualify for the zero guarantee fee are Subsidized and Unsubsidized Federal Stafford Loans guaranteed by the state. Under the FFELP, federal methodology determines the amount of subsidized and/or unsubsidized loans available to individual students from information supplied when completing the Free Application for Federal Student Aid (FAFSA). This is the same application which must be completed by students to qualify for the state’s TOPS scholarship. To obtain these no-fee loans, students must apply through their schools and may select lenders participating in the state’s program.
With the elimination of the 1 percent insurance fee, students choosing the State of Louisiana as the guarantor of their loans will receive 1 percent more funds to expend toward qualifying higher education expenses.
Financial Aid Officers at Louisiana’s
postsecondary schools who want help switching their students to a Louisiana
guaranteed loan can call their LOSFA customer service representative at (800)
259-5626, Ext. 1012.
NEWS AND UPDATES
New lenders participating in LOSFA’s loan programs are Wilmington Trust Company of DE, lender ID #802218, Trustee for Sallie Mae Education Trust in Killeen, TX, and Bank One, Texas, ID#820734, as Trustee for Brazos Educational Assistance Inc.
The Louisiana’s Financial Aid Handbook or "blue book" is now available! In May, LOSFA mailed more than 80,000 to high schools and colleges throughout the state, legislators, lenders and other interested parties. If you would like to order copies, call our Customer Service Representatives at (800) 259-5626, Ext. 1012.
Royce Dillard, former Student Employment Coordinator, has replaced Keisha Helm as Scholarship Coordinator at Louisiana Tech University in Ruston. Helm left Louisiana Tech on May 28 and moved to Dallas, TX.
So long: LOSFA bids farewell to Mark Rhodes, Program Review Auditor, who accepted an auditing position with the Department of Health and Hospitals. Rhodes has been with LOSFA since 1989. In addition, LOSFA extends best wishes to Newsline’s Layout Editor Robert "Ian" Scott, who will be joining the LOSFA Information Systems Division. Good luck, Mark and Ian.
Newsline Address Updates Requested: To receive your copy of Newsline in a timely manner, take a moment to review the contact name and address on the mailing label. To make a change, please photocopy the label, make changes and return it to Mona Kraushaar, Newsline Copy Editor, P.O. Box 91202, Baton Rouge, LA 70821-9202; or fax to (225) 922-0790.
Sallie Mae offers a free Online Scholarship Service at http://www.salliemae.com. Sallie Mae’s service gives individuals exclusive access to the College Aid Sources for Higher Education (CASHE). Questions about the CASHE database should be directed to (800) 462-2743. To speak with a financial aid expert about college financing issues, call the College Answer hotline at (800) 891-4599, Monday-Friday, 8 a.m. - 11 p.m. (ET).
Nominations are in, and LOSFA is moving into high gear with preparations for this summer’s Trailblazer Camp. More than 200 high school students were nominated by their guidance counselors to attend the sixth annual camp, scheduled for LSU-Baton Rouge this year. The theme is "Blazing the Trails for the Future."
SPECIAL ALLOWANCE RATES
For Quarter Ending March 31, 1999
Allowance at Quarterly
Annual Rate Annual Rate Factor
Loans prior to 10/1/81
7% .01125 .002813
9% .00 .0000
Loans from 10/1/81 to 11/16/86
7% .0104 .0026
8% .0004 .0001
9-14% .0000 .0000
Loans from 11/16/86 to 10/1/92
7% .0079 .001975
8%-14% .0000 .0000
Loans from 10/1/92 to 7/1/98
6% .0164 .0041
7% .0064 .0016
8-14% .0000 .0000
8.25-14% .00 .000000
Loans on/after 7/1/95 but prior to 7/1/98 only during in-school, grace
7.66% .0000 .0000
Loans on/after 7/1/98 but prior to 7/1/03 only during in-school, grace
6.86% .0000 .0000
Loans on/after 7/1/98 but prior to 7/1/03 except during in-school, grace and deferment
7.46% .0000 .0000
Tax-exempt loans prior to 10/1/81
7% .025 .00625
9% .005 .00125
Tax-exempt loans from 10/1/81
6% .035 .00875
6.86% .0264 .0066
7.% .025 .00625
7.46% .0204 .0051
7.66% .0184 .0046
8% .015 .00375
8.25% .0125 .003125
8.26% .0124 .0031
8.41% .0109 .002725
8.53% .0097 .002425
9% .0050 .00125
10-14% .0000 .0000
The average bond equivalent rate of the ninety-one day Treasury bills auctioned
during the quarter ending March 31, 1999 is 4.54 percent.
Questions about special allowance rates should be directed to Susan Michelli, Program Review, at (800) 259-5626, Ext. 1092.
changed for filing and resolving pre-claims
Lenders are reminded that the dates for filing and resolving Lender Requests for Assistance (LRA) have changed.
An LRA may be filed as early as the 60th day of delinquency, but must be filed no later than the 80th day of delinquency. This time frame must be adhered to in order to be considered timely in the event a default claim is subsequently filed.
Upon receipt of an LRA, OSFA’s Pre-Claim Section begins to make contact with delinquent borrowers. Letters are sent and telephone calls placed approximately every 30 days. The letters and telephone calls are designed to remind borrowers of their obligation and how it can be resolved. Borrowers are also reminded of the consequences of default. If a loan enters default, a borrower’s credit rating will be severely damaged, his/her eligibility to take out further federal loans will be suspended, and professional licenses granted by the State may be denied.
After July 1, 1999, the new time periods will be used to determine whether a lender has filed for pre-claim assistance in a timely manner, should a default claim be subsequently filed by the lender.
If there are any questions concerning this, contact the Pre-Claim Administrator, Lynda Downing at (225) 922-1062.
LOSFA conducts a variety of training sessions
Our staff at the Louisiana Office of Student Financial Assistance (LOSFA) has been busy this spring coordinating a number of training sessions. The sessions covered many topics and provided helpful information to various attendees including high school officials, financial aid administrators and our own employees.
LOSFA sponsored a training seminar regarding electronic billing procedures for Louisiana’s Tuition Opportunity Program for Students (TOPS) on Friday, April 16. Financial aid administrators, staff from the institutions’ scholarship offices, bursars’ and/or business offices, and information systems personnel who are involved with TOPS billing were invited to attend. The workshop addressed the following topics: file transfer protocol, master roster content, payment requests, payment rosters, grade reporting and academic probation reporting.
The more than 55 attendees, representing 20 state colleges and universities, also participated in a panel discussion on issues relating to the TOPS billing process. Each institution also had the opportunity to schedule a consultation on billing issues specifically related to its operations.
A training seminar on manual billing procedures for TOPS was conducted on Wednesday, May 5. During this training, our staff presented information about eligibility, awards, master roster content, billing, payments, grade reporting and renewal processing. The program focused on students receiving TOPS at the Louisiana technical colleges. Thirty-seven financial aid professionals from 23 institutions across the state attended. They also participated in a panel discussion on issues relating to the TOPS billing process and courses of study that qualify students for the TOPS-TECH Award.
LOSFA conducted a trial test and training session on Monday, May 10, for high school guidance counselors who have chosen to use our website to certify students for TOPS. This exercise gave our staff the opportunity to receive opinions from counselors who will use the program. The information shared with our staff will be beneficial, as we continue our efforts to provide efficient and cost-effective methods for certification of TOPS applicants.
LOSFA employees attended three-hour training sessions on the functions of the agency’s Loan Operations Division (including Loan Processing and Servicing, Claims, Pre-Claims and Collections) on May 4 and May 10. Each section chief gave an overview of his or her area. Attendees included new employees and members of our Customer Services and Loan Operations divisions.
Pat Shannon, Director of the Loan Operations Division, facilitated the training. Shannon’s presentation addressed the federal fund, operating fund, and program terminology. She also stressed the importance of ensuring prompt service and expeditiously resolving issues. Following the presentations, Customer Service representatives received hands-on demonstrations in each section.
LOSFA wants to help schools, lenders, borrowers and financial aid professionals to learn more about our services and/or programs. We are committed to this effort and ready to offer our assistance. If you have any suggestions for future training sessions, please call us at (800) 259-5626, Ext. 1012.
EDITOR'S NOTE: The following letter was
received from a 1998 Trailblazer on May 18, 1999.
I would like to thank you for the excellent resources I received last summer (during Trailblazer Camp). I have been awarded nine scholarships, and I also meet the academic qualifications to receive TOPS. In addition, my classmates were awarded more scholarships this year than any other year. So, I wanted to say thank you for all the information you made available during the 1998 Trailblazer Camp.
Jamar Jackson, Class of 1999
Glen Oaks High School
Baton Rouge, LA
High schools use Internet to report on TOPS applicants
More than 200 Louisiana public and private high schools have elected to certify their students’ TOPS eligibility via the LOSFA Web site. Online high school certification became a reality on May 25, 1999. The electronic option speeds the process dramatically by which schools report the grades and courses of TOPS applicants.
Each night, certifications entered during the previous 24 hours are merged into the TOPS master file on the agency’s mainframe computer and eligibility checks are performed automatically.
Students who meet all eligibility requirements are then automatically added to the TOPS Master Roster, which is updated each Friday. The following Monday morning, an award letter to the student is automatically generated, the student’s updated eligibility status is added to the LOSFA Web site eligibility area for student access, and the student’s name is automatically added to the TOPS Master Roster. The roster is then transmitted electronically to all colleges and universities in the state. Last year, high school reports required manual data entry.
1999 high school graduates may check their current TOPS eligibility status 24 hours a day via the Internet by accessing the LOSFA World Wide Web site at http://www.osfa.state.la.us. On the web site’s home page, the student will select the "TOPS Eligibility Sign On" option. The student will then be required to enter his or her Social Security Number (SSN) and date of birth. Upon successfully doing so, the student should click on "Look Up." This will take the prospective TOPS recipient into a secure, encrypted area of the LOSFA Web site to a screen entitled, "TOPS Eligibility Results." Below this heading, the student will see either "Eligible" or "Ineligible."
If the student is eligible, the TOPS award that the student has qualified for will be printed at the bottom of the screen.
If the student is currently ineligible, the message at the bottom of the screen will identify the reason(s) for the ineligibility.
The center of the screen will list all of the data relating to eligibility requirements that LOSFA has received to date including the student’s name, SSN, birth date, American College Test (ACT) score and test date, high school code, graduation date, Grade Point Average (GPA), number of Core Units and Core Unit exceptions certified by the high school, the date the student’s Free Application for Federal Student Aid (FAFSA) was received, the student’s dependency status, citizenship status, defaulted student loan status, Louisiana residency status, and date of residency.
If the student disagrees with any of the data shown on the screen or can provide missing information, he or she should call LOSFA Customer Services at (800) 259-5626, Ext. 1012. In the Baton Rouge area, the number to call is 922-1012. Callers will be assisted between 7:45 a.m. and 5:00 p.m. Monday through Friday.
Students who should expect to find their eligibility status on the LOSFA Web site in June, are those 1999 high school graduates who filed their FAFSAs by April 15, 1999, earned a qualifying ACT score on or before the April 1999 national test date, and whose high school officials have reported to LOSFA the student’s core curriculum and GPA.
Students who have recently submitted their FAFSA, as well as those who have not yet done so, will not appear on the LOSFA Web site until their FAFSA processing has been completed, they are matched with a qualifying ACT score, and high school certification requests are generated, completed and returned.
The final deadline for receipt of the FAFSA for TOPS consideration for the 1999-2000 academic year is July 1, 1999. A FAFSA may be obtained from any university financial aid office, or may be completed online at http://www.fafsa.ed.gov.
Students who do not have access to the Internet may call (800) 259-5626, (381-7262 in the Baton Rouge area). From the main menu options, the caller should press "2." This will access the Scholarship, Grant, and Savings Programs menu. By pressing "2" again, the caller may inquire about the status of his or her TOPS award. The caller will be instructed to enter his or her SSN, followed by the pound sign. Upon successfully doing so, the caller will hear a recorded message identifying his or her current eligibility or ineligibility, status. The caller will then be given the LOSFA Web address, or the option to speak to a Customer Service Representative, for more detailed information.
Last year, LOSFA received in excess of 139,000 telephone calls during the week following production of the first TOPS eligibility roster, with nearly 60,000 calls attempted in a single day. LOSFA officials hope that the Internet option available this year will ease the burden on the agency’s telephone system and allow more calls to get through with shorter waits. In addition, the agency has doubled its number of incoming telephone lines as well as the number of personnel dedicated to answering them.
Students who received TOPS awards during the just-completed 1998-99 academic year will not receive notifications of whether the awards have been renewed until later in July. Their eligibility for continuation cannot be determined until colleges and universities have billed for 1998-99 awards and forwarded grade and hour reports.
Counselors attend TOPS certification training
During a recent test and training session, high school guidance counselors learned to complete certifications for the Tuition Opportunity Program for Students (TOPS) using the LOSFA Web site.
During the training, counselors used the Web site for certifying students for Louisiana’s popular TOPS program. The counselors retrieved files and entered information required for certifying students. LOSFA staff provided instructions, helped participants with the process and answered questions.
According to Elsie Honeycutt, guidance counselor of Christian Life Academy in Baton Rouge, the new process which uses the Internet to complete certification for TOPS is very convenient. "In fact, I can work at home or anywhere by reaching the Internet. I like this new idea a lot," Honeycutt said. She continued, "The training session allowed me the opportunity to gain hands-on experience, and I asked questions right then and received answers. The program is user-friendly and beneficial to me." Dianne Williams, senior counselor at West Feliciana High School in St. Francisville, was among the attendees at the training. She stated, "Using the Internet to certify students for TOPS will be very helpful to schools, especially if the counselors have many students to certify. Most important, it eliminates a lot of steps, which saves time and money for the schools." She also thinks that the program is simple to use. "I was very apprehensive about the training until I started working with the program. Then, I felt very comfortable. It was really easy. It is going to be beneficial to me," Williams said.
In addition to Honeycutt and Williams, participating school officials included Katheryne Haley, Senior Counselor (Denham Springs High School); Nancy French, Registrar (St. Amant High School); and Deborah Schmidt, Counselor (Robert E. Lee High School, Baton Rouge).
Cochran demonstrates Trailblazer spirit
John Cochran, a senior at St. Frederick’s High School in Monroe, was in the right job to be a Trailblazer. He worked in the school guidance office and the Guidance Counselor, Stacy Doyal, had to take maternity leave. In her absence, he handled calls about Louisiana’s Tuition Opportunity Program for Students (TOPS), about the Free Application for Federal Student Aid (FAFSA) — in fact, about all types of scholarships and loans. "I was pretty much the one they talked to," Cochran said. "If there was something I couldn’t answer, I’d just give them LOSFA’s 1 - 800 number." John participated in LOSFA’s Guidance Counselor Workshops with Mrs. Doyal and spoke to individual classes on what he had learned at last year’s Trailblazer Camp.
So it came as no surprise that this January Cochran initiated, planned, and emceed his school’s entire Financial Aid Night. He arranged a presentation by LOSFA Customer Service Representative Jeff Cropco, introduced him, and at the end, fielded financial aid questions from the audience.
"I had no way of knowing a student had put the workshop together," Cropco said, "it was so well done." But Cochran was the first student master of ceremonies he’d run into. He began wondering how much Cochran had actually done with the program and learned from Doyal he’d done it all.
Cochran was asked what motivates him to be active in student financial aid. "There’s just so much to learn," he said. "And there’s so much that people don’t know, and I was just trying to help out my friends."
Cochran plans to major in ceramic engineering. He is a three-time Louisiana High School Athletic Association State swimming champion. He is chairperson for the St. Frederick’s Warrior Renaissance Committee, an academic incentive program which rewards students for academic excellence.
Important Changes in Louisiana's College Savings Program
START Program Rule Changes
The Louisiana Tuition Trust Authority (LATTA) has approved two significant rule changes for Louisiana’s college savings program, referred to as the START Saving Program.
The first rule change eliminates the restricted enrollment period, thus allowing accounts to be opened year-round. Previously, new START Saving accounts could only be opened between July 1 and November 1 annually. Under the new rule, an account can be opened at anytime. However, it must be opened prior to November 1 in order to qualify for a Tuition Assistance Grant (TAG) for that year.
Out-of-State Use of Tuition Assistance Grants
The second rule change will permit the use of Tuition Assistance Grants (TAGs) to pay tuition at out-of-state colleges and universities. Previously, the use of these matching state contributions and their accumulated earnings were limited to payment of tuition at in-state institutions. Prior to this rule change, if the beneficiary chose to attend an out-of-state school, the TAGs and their earnings were lost.
Ignore Application Deadlines
The current Depositor’s Agreement/Application may now be used to enroll in the START Saving Program through December 31, 1999. You may disregard the statement in the booklet referring to "open enrollment through November 1, 1998 and to enroll newborns through June 30, 1999" and all references to restricted enrollment. For more information, call the Louisiana Office of Student Financial Assistance at 1-800-259-5626, Ext. 1012.
These changes amend the Disclosure Statement and Program Description of the Student Tuition Assistance and Revenue Trust (START) Program and Louisiana Education Tuition and Savings Fund found on pages 21-28 of the START Depositor’s Agreement Booklet.
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