Pennsylvania Student Loans
The Commonwealth of Pennsylvania is home to some of the most prestigious colleges and universities in the country. From smaller private institutions like Franklin and Marshall, Bryn Mawr, and Seton Hill to large public universities like Pennsylvania State, the University of Pittsburgh, and Temple University, students seeking baccalaureate, graduate, or professional degrees have a wide range of options to choose from. Technical schools like the Pennsylvania Institute of Technology, the Pittsburgh Institute of Aeronautics, and the Hussian School of Art offer specialized degrees and career programs.
Federal Student Loans in PA
Financing an undergraduate or graduate degree isn’t easy these days — and it’s almost impossible without the help of loans, grants, and scholarships. According to the Pittsburgh Post-Gazette, college students in this state graduate with an average of nearly $32,000 in debt: the third highest student debt load in the nation.
Up to 70 percent of graduates from PA college and universities carry student debt — a high percentage compared with the rest of the country. Graduates of private institutions, in general, have a higher student debt load than those who complete their education at a state school. With the cost of tuition and college-related expenses on the rise, students are looking for creative ways to fund their goals. Pennsylvania offers a variety of federal and state opportunities to place an affordable education within your reach.
Federal student loans are the foundation of many students’ financing strategies in Pennsylvania. The U.S. Department of Education sponsors several programs to assist students seeking a degree, including loans, grants, and work-study awards. Federal loans are offered at low fixed interest rates, and recipients do not have to start repaying the loan until after graduation. The following federal loan programs can be used to cover tuition, books, supplies, computers, or college-related living expenses:
- Perkins Loans: Available to undergraduate and graduate students, Federal Perkins Loans are based on the applicant’s financial need. Perkins Loans are issued by post-secondary institutions using federal funds.
- Direct Stafford Loans (Subsidized): Federal Direct Loans are based on financial need. Students must be enrolled at least half-time in an undergraduate program to qualify. With subsidized loans, the lender is the U.S. Department of Education. At certain times in the life of the loan, interest is not charged.
- Direct Stafford Loans (Unsubsidized): Direct Unsubsidized Loans are issued by the U.S. Department of Education, but the applicant does not have to prove financial need. Students must be enrolled at least half-time, and interest is charged throughout the duration of the loan.
- Direct PLUS Loans: Federal Direct Plus Loans are available to graduate students, professional students, or undergrads who are financially dependent on a parent or guardian. Proof of financial need is not required, and interest is charged throughout the whole period of the loan. Applicants must pass a credit check to qualify for a Direct Plus Loan.
Unlike federal loans, federal grants and work-study awards do not have to be repaid. Pell Grants are based on need and available to undergrads earning their first professional or baccalaureate degree. Federal Supplemental Educational Opportunity Grants (FSEOG) are awarded to undergraduate students and issued by the school. Not all schools participate in the FSEOG program.
Work-study programs, which are administered by the college or university, provide payment to students who work at a job that reflects their academic goals. Work-study jobs are usually sponsored by the school or by agencies affiliated with the school. The money you earn from a work-study position does not have to be repaid. The Pennsylvania State Work-Study Program (SWSP) allows students to work part-time or full-time (up to 40 hours a week) in a career-related position.
Since it was created in 1963, the Pennsylvania Higher Education Assistance Agency (PHEAA) has helped students qualify for state and federal financial aid. The PHEAA sponsors several popular programs to help state residents cover the costs of their education:
- The Pennsylvania State Grant Program: Awarded to PA state residents seeking their first undergraduate degree, Pennsylvania State Grants are available to students who can demonstrate financial aid and who are enrolled at least half-time. The degree program must be approved by the PHEAA, and students must prove that they’re making satisfactory academic progress in order to maintain their funding.
- The PATH Program (Partnerships for Access to Higher Education): PATH grants are sponsored by the PHEAA in partnership with non-profit agencies that help support college students with financial need. Examples of participating organizations include the Philadelphia Education Fund, Philadelphia Futures, the York County Hispanic Coalition, Kids Chance of PA, and many others. To qualify, students must be awarded a grant by one of the partner agencies and must receive a Pennsylvania State Grant. Funds will then be matched up to a certain point by the PHEAA.
- Blind or Deaf Beneficiary Grant Program: Students who have either of these disabilities and who are enrolled at least half-time in an eligible educational program may apply for financial aid awards of up to $500 per year.
- Postsecondary Educational Gratuity Program (PEGP): The PEGP provides financial aid to the children of law enforcement officers, employees of the correctional system, and members of the National Guard who died in the line of duty. PEGP can help cover any college-related expenses that are not covered by other grants, loans, scholarships, or work-study programs.
- Pennsylvania Targeted Industry Program (PA-TIP): Students earning degrees in agriculture, food production, manufacturing, or energy can apply for a grant from PA-TIP. Qualifying applicants must demonstrate financial need, and funds can be used to cover tuition, room and board, books, and other educational expenses.
- Pennsylvania Chafee Education and Training Grant Program: Undergraduates who were formerly in foster care and who attend participating postsecondary institutions are eligible to apply for this program. Grants from this program are drawn from federal funds.
- Teacher Education Assistance for College and Higher Education (TEACH) Grant: Undergrads who commit to teaching or to working in educational agencies in low-income areas can qualify for TEACH grants. Applicants must agree to teach for a specified period of time, currently at least four years, in order to receive a TEACH grant. If not, the grant will be converted to a Federal Direct Loan, which must be repaid.
- Ready to Succeed Scholarship Program (RTSS): This merit-based program offers scholarships to Pennsylvania students who meet certain academic standards and whose family income does not exceed an established limit. Students are nominated by their postsecondary institution after completing their first year of courses. To qualify, they must have a grade point average of at least 3.25.
Does Pennsylvania Issue Student Loans?
The state of Pennsylvania sponsors student loans through the U.S. Department of Education. The PHEAA services federal loans for Pennsylvania students through an organization called FedLoan Servicing, which helps students through the process of applying for funding, managing their loans, and repaying their student loan debt. According to the PHEAA, Pennsylvania residents have received over $8 billion in financial aid awards through the state’s grant program since 1966.
Pennsylvania college grads who pursue careers in public service or teaching can apply for a federal loan forgiveness programs. Loan forgiveness programs will repay a percentage of your student debt if you agree to serve in a service-based career, usually in a high-need area, for a certain amount of time. The Public Service Loan Forgiveness Program is available for students who agree to enter the service professions, such as law enforcement or public safety. The Federal Teacher Loan Forgiveness Program assists graduates who commit to teaching full-time in a high-need area.
Qualifying for Pennsylvania Financial Aid
What does it take to qualify for a grant, scholarship, or work-study award through the state of Pennsylvania? To be eligible, you must meet the following criteria:
- Qualify as a state resident and high school graduate
- Enroll at least half-time in an educational program approved by the PHEAA
- Be pursuing your first undergraduate degree
- Maintain the academic standards of your grant program
- Maintain certain standards of character
- Not default on other student loans
The Free Application for Federal Student Aid (FAFSA) is your starting point when you’re applying for both federal aid and Pennsylvania state grant programs. Applicants for Pennsylvania financial aid must also complete the Pennsylvania State Grant Form. Additional documents may be required, depending on the program.