Awarding for Increased Grade Level Eligibility

Federally funded financial aid programs require strict eligibility requirements and borrowing limits. Most grade level limits increase as students progresses in their studies. A student who has already borrowed up to the annual level limit within an academic year can receive additional funds if the annual level limit increases because a student advances or progresses to a new grade level with a higher-level limit. Financial Aid provides two procedural options to accommodate and award for an additional increase due to grade level changes. Option one is to use multiple and/or unique item types with different disbursement plans or split codes to support the additional eligibility. The other option is to select the Multi-Pass Processing check box. The Multi-Pass processing option set at the aggregate area level provides the means to automate mid-year grade level limit increases during the Awarding and Packaging process. This is an optional setting. This option is currently disabled for loan programs processed by the financial aid Loan Origination process (for example, Direct, FFELP, Health, Alternative and Perkins loan programs).

See Setting Up Aggregate Aid.

To award funds that have aggregate level limits defined and do not have the Multi-Pass processing option selected, you must use multiple Financial Aid Item Types and different disbursement plans/split codes to support the additional term. The Financial Aid Item Types must be associated with the same aggregate area to calculate aggregate limits correctly. The following scenario for the Stafford loan program demonstrates how it works.

Awarding Stafford loans across multiple NSLDS loan years is necessary when a student begins the financial aid year at one NSLDS level and then advances to the next level in subsequent terms within the same aid year. For example, you may have a student who is a freshman in the fall term but has enough credits to advance to a sophomore in the spring term. To determine the NSLDS loan year, Packaging evaluates the first nonzero disbursement record dictated by the disbursement plan/split code pattern and uses the corresponding term for that record. Then Packaging checks the student's NSLDS loan year for the corresponding term where the first nonzero disbursement record appears.

The student is awarded initially based on his or her freshman status—NSLDS loan year is Freshman. The student is awarded the maximum loan amount for a freshman—sequence #10. You select a disbursement plan/split code pattern for equal disbursements. You validate and post the award. The following table shows the initial loan award:

Seq	Item Type	Aggregate Area	Award Amount	Disb Plan	Disb Split	Disb Amount	Term/ NSLDS Level
10	900000001234	Subsidized Stafford	2625 USD	01	01 = 50% 50%	1313 USD 1312 USD	Fall/Freshman Spring/Freshman

Near the end of the fall term the student tells you that he or she has enough credits to be a sophomore for the spring term and would like to receive additional loan money. First, you must change the NSLDS loan year on the student's Financial Aid term record for the term in which the student advances to sophomore status. After changing the NSLDS loan year, rebuild the student's spring budget. Then the additional award amount must be entered as a separate Financial Aid Item Type on the award entry page—sequence #20. To do this, you must have two Financial Aid Item Types set up for the subsidized Stafford loan and two Financial Aid Item Types set up for the unsubsidized Stafford loan. Use one for the initial award and the other for any subsequent (add-on) awards.

You award a subsequent Stafford loan, using a different Financial Aid Item Type from the initial loan award and a different disbursement plan/split code pattern to support only the spring term. Packaging determines the award amount for the add-on loan. Use a disbursement plan/split code pattern that distributes 100 percent of the additional award in the spring term. If there were more than one term remaining in the aid year, you would distribute the 100 percent evenly across the remaining terms. If you are manually packaging the student, you can leave the award amount at zero, and the Validation process calculates the difference between the freshman loan maximum already awarded and the sophomore loan maximum and awards the correct amount (the difference). After validation, the two loans are both shown because they are two separate Financial Aid Item Types. The Financial Aid Item Types must be associated with the same aggregate area to account for all sources that affect aggregate limits eligibility.

The first award is the total freshman loan amount split evenly across both terms and the second award—a different Financial Aid Item Type—represents the additional spring term only amount the student is eligible to receive as a sophomore. The following table shows the awards before and after validation:

Seq	Item Type	Aggregate Area	Award Amount	Disb Plan	Disb Split	Disb Amount	Term/NSLDS Level
10	900000001234	Subsidized Stafford	2625 USD	01	01 = 50% 50%	1313 USD 1312 USD	Fall/Freshman Spring/Freshman
20	900000005566	Subsidized Stafford	875 USD	03	01= 100%	875 USD	Spring/Sophomore

* Using the defined Aggregate limits, Packaging determines the student's eligibility to be 3500 USD (sophomore aggregate limit) minus 2625 USD (freshman award) equals 875 USD (maximum sophomore eligible limit).