Trenton, NJ – In its continuing effort to reduce the cost of attending college, the New Jersey Higher Education Student Assistance Authority (HESAA) announced today that, for the 2009-10 academic year, it will pay the .5% origination fee charged on Federal Stafford loans for our neediest students, i.e., those receiving Tuition Aid Grant assistance and/or Educational Opportunity Fund grants, whose loans are administered through HESAA. The origination fee is typically collected by the Federal government and added to the amount the student needs to borrow. Payment of the origination fee is in addition to HESAA’s current policy of paying the 1% default fee collected by the Federal government on Stafford and PLUS loans. HESAA’s payment of the default fee has delivered over $44 million in life of loan savings to New Jersey students. Without these savings, students would have less money to use for educational expenses, and result in more costly loans.
“In our challenging economy, every dollar counts, especially for those struggling to meet the cost of college,” stated Michael Angulo, Executive Director of HESAA. Consistent with Governor Corzine’s strong commitment to keeping college affordable and accessible to all New Jersey student, HESAA will pay approximately $600,000 towards the origination fee, and $6 million towards the default fee for the 2009-10 academic year. With interest, these fees translate to approximately $13 million over the life of the loans. “Without question, these savings will provide welcome and meaningful assistance to our students,” Director Angulo added.
Despite the State’s difficult fiscal situation, HESAA is in a unique position to help New Jersey students. Specifically, HESAA earns revenue through its participation as a guaranty agency in the Federal Family Education Loan Program (FFELP). In addition to delivering direct borrower benefits, HESAA uses its revenue to support the administration of 26 critical State and Federal financial aid programs, including the Tuition Aid Grant program, the Bloustein Distinguished and Urban Scholars program, NJCLASS, NJSTARS and STARS II, and NJBEST. Since 1959, HESAA has assisted more than 5 million students, delivering over $18 billion in State and Federal student aid.
Notably, not all New Jersey colleges participate in FFELP or use HESAA. To ensure that HESAA pays the origination and/or default fee on your federal loan, contact your college financial aid office and request a HESAA guaranty for your loan.
This year, HESAA is celebrating its 50th Anniversary. “I am proud of our outstanding record of assisting students realize their dream of a college education, a record that now includes payment of the origination fee for our neediest students,” Director Angulo concluded.
Since 1959, HESAA, a non-profit, state designated Authority, has delivered over $18 billion in financial aid. Each year, over 1 million students receive assistance from outreach programs and aid programs HESAA administers including Tuition Aid Grant (TAG), the Part-time TAG for County College Students, NJSTARS and II, the Garden State Scholars programs, the Federal Family Education Loan program, NJCLASS, and NJBEST. For additional information about HESAA please visit our website at www.hesaa.org or call our Customer Care Center at 609-584-4480.